According to a new study, consumers no longer compare car buying to a stubborn root canal. In fact, as auto dealers move more steps of the retail process online, consumer satisfaction is at an all-time high.
“According to our data, car buyers have never been happier,” Cox Automotive VP of Research and Market Intelligence Isabelle Helms said in a news release regarding the findings of Cox Automotive’s Digitization of End-to-End Retailing study (DoEER).
In the vehicle-buying process, according to the study, the average buyer now visits only two dealerships. That is a decline from 2.7 in 2016.
Buyers are spending less time at dealerships and benefiting from more efficient, digital retailing processes. That has helped increase the percentage of those who were “highly satisfied” with the overall shopping experience. The percentage jumped from 60% in 2019 to 72% now.
Cox Automotive implemented the study to measure and understand the shifts in consumer preference toward a more online purchase process. The company interviewed 1,859 purchase intenders starting in August, along with 462 franchised auto dealers that offer digital retailing tools.
The company took on the study while noting that digital retailing is not new to the automobile business. But according to the study, only one out of three franchised U.S. automobile dealers offer all the purchase steps online.
Cox Automotive also said it still believes auto dealerships as physical locations play an important role in the vehicle-buying experience. That is the case even as interest in digital retailing continues to grow, and that digital retailing interest showed strong growth last year during the pandemic.
Research shows that automobile shoppers still prefer to spend quality time at the dealership, Cox said. Those shoppers want to test-drive the vehicle and set up their new vehicle after purchase. The company said those hands-on activities are much more enjoyable and informative than filling out paperwork and waiting.
But with that being said, the future is digital, according to Cox. The entire process, all the way to negotiating the final purchase price, is moving online.
Cox Automotive research in 2017 showed that 25% of buyers wanted to finalize the vehicle price online. That number jumped to almost 40% by 2020.
According to Cox, dealers have noticed that trend. Of the franchised dealers surveyed in the DoEER study, 80% planned to offer even more aspects of the purchase process online in the next one to two years.
But even with the statistic mentioned earlier that only one out of three franchised U.S. automobile dealers offer all the purchase steps online, Cox Automotive said the shift is on: 69% of franchised dealers last year added at least one digital step because of COVID-19. Seventy-four percent said their customers have increased their use of digital retailing tools since the onset of the pandemic.
Finding information on incentives, calculating monthly payments, applying for credit, and finalizing the vehicle price were among the most popular activities for shoppers to complete online or at home.
“Importantly, franchised automobile dealers know what the future holds,” Cox Automotive wrote. Seventy-five percent of surveyed dealers would not be able to survive in the long run without adopting digital retailing tools and moving more of their sales process online.