7:51 am, May 10, 2013
ARE you ready to be an internet car retailer?
One transition is complete, the next is just beginning. Consumers have changed the way they buy vehicles. Dealers have changed the way they advertise their vehicles.
Consumers now spend 60 per cent of the entire buying process online. This equates to 11 hours spent online for a used vehicle, and 11.5 hours for a new vehicle. The internet makes it easy to search for cars at home, refining the make, model and variant combinations and comparing results nationally in seconds, versus travelling around the local area trying to find the best car and the best deal.
The internet saves time and energy. The comparability of results provides a transparency of data that enables consumers to optimise their decision on getting the best car at the best price.
During this consumer transition, dealers who shifted their advertising budget online quickly won – but now all dealers spend a considerable share of their advertising budget online. The next consumer transition is a continuing increase in time spent online for the shopping process from 60 per cent to 70, 80, 90 and maybe even 100 per cent in the future.
Data is the next big thing for businesses, as online was 15 years ago. The transition to an online world has created massive data sets where additional information can be gleaned from analysis of a single large set of related data. For dealers to become internet car retailers they need to embrace data and, more importantly, extensive data.
Consumers leave a trail of extensive data through their online shopping. It’s impossible for a dealer to win by just using experience against a dealer who has experience and uses this data. For example, the leading classified website reached 11.5m unique users in March, and over 3m unique users on mobile.
This creates one massive data set about what consumers want, the overall desirability of different vehicles, what prices are sensible and which vehicles they compare versus other vehicles by region. Internet car retailing is about using this extensive data to inform decision making about what to stock, where, and at what price.
These data sets can tell you the retail price of your vehicles versus the market and your competitors, the desirability of your vehicles versus your competitors, the speed of sale of your vehicles and the volume of consumer demand — the list is endless.
Knowing this data, using it with experience, understanding how it interrelates to form the right strategy for your business operations and then, importantly, using it to optimise your advertising spend online is key to winning during the next 15 years when the shopping process moves completely online.
Currently 100 dealers use extensive data through sophisticated recommendation engines. Are you ready to join them?
