Alex Melen

Even with state regulations and other dealership impacts from the pandemic, consumers did not stop shopping – or purchasing – vehicles as there was a new need for the ability to travel safely from the comfort of their vehicle and a new way to buy – online.

Auto shoppers turned to Google to understand if they could – or should – purchase a car: We saw ‘Is now a good time to buy a car?’ spike 900% in March when the pandemic hit.

As we enter the last month of 2020 – dealing with a COVID resurgence and election uncertainty, it is as good of a time as any to come to terms with the fact that vehicle buying has changed.

With consumers becoming more comfortable in this new normal, a shift has emerged in the market with people now buying cars as a result of personal safety/health reasons. And there are also new demographics of people buying. A recent survey reported 20% of respondents who didn’t own a car were considering purchasing one. A simple metric shows how far we’ve come – in 2018, only 1% of car sales in the U.S. were online. In March of 2020, nearly one in 10 car sales were online. According to forecasts, 25% of car purchases will be online by 2025.[1]

“If a consumer wants to discuss financing over the phone instead of coming in, be ready to do that.”

So, who are these new digital-embracing consumers? How are they going to be shopping? Well, 63% of new purchasers said they would consider ordering their future car online and having it delivered to their home. 73% said they are comfortable negotiating the purchase, lease, or financing terms entirely online or through a mix of online and offline.[2]

Some in the automotive space see this as an existential threat when, in fact, it is an opportunity to evolve and thrive. Is there a secret formula to accomplish this? Any specific timing on when things will change again? Unfortunately, no. But working with thousands of clients across all industries, I will give you my playbook to succeed this holiday season and beyond.

1. Short-term: Be flexible. 

Consumers are going to have different comfort levels – some will embrace digital more than others. Be flexible, understanding, and empathetic with both the way you approach the consumers and with your marketing messaging. Offer flexible purchase options, pickup/drop off options, and so forth. If a consumer wants to discuss financing over the phone instead of coming in, be ready to do that. And not only should you be ready to do all of this – you should be conveying this on your website and in all of your marketing.

“The path forward for auto is to offer shoppers the choice of moving frictionlessly between online and offline experiences in the customer journey.”

2. Mid-term: Be Agile.

If there is one thing that’s certain, it’s that we will have more uncertainty in the next three, six, and even 12 months than we’ve ever had before. By most metrics, more-so than we had in the last six months. Nobody can predict all of the trends, but you can be agile in it. Make sure you review your marketing and messaging on a regular basis. What’s important to the consumer next month may be different than what’s important to them today. Be ready to spot trends in real-time and take action on them.

3. Long-term: Be transformative.

The digital transformation is here.

“Clearly COVID has dramatically accelerated digital adoption,” Gass says. “I mean, some would say, five-plus years what it typically would have taken across all demographics.” – Michelle Gass CEO Kolh’s Nov 5th, 2020.

You must reimagine what the purchase experience looks like for the shopper. How are you creating a frictionless online experience, educating your customers, and connecting your messaging across all tiers? How are you capturing demand in a dynamic way? Doing all of this will require smarter automation that can make actionable sense of data and signals, in real-time, at scale. The path forward for auto is to offer shoppers the choice of moving frictionlessly between online and offline experiences in the customer journey.

I believe what will separate those who thrive vs. those who fail in the next five years will be determined by how good you are at capturing data, turning it into actionable insights, and altering your business operations based on that. You must understand and accommodate the new digital consumer (who will range from those who are purely digital to those who move back and forth) and also communicate your accommodations in all that you do (website, all levels of marketing, etc.)

So, how do you succeed with your marketing in the new digital paradigm?

Succeed by upping your measurement game. Establish your business objective and align high-value action KPIs and store visit measurement strategies to understand the entire journey and signals of an auto buyer.

Succeed by adopting automation. Adopt bidding and targeting tools to help you drive better performance while maintaining strong privacy controls.

Succeed by focusing on cross-tier customer-centricity. Deploy a frictionless, customer-led, end to end online auto shopping and purchase experience supported with marketing across tiers.

Succeed by identifying how the industry’s new but somewhat standardized buying tools are not so similar at your dealership. Work closely with your internal marketing personnel and outside Agency/Consultant providers to carefully craft your unique identity in an ever-crowded space of online car sellers

“One thing in dealership marketing and messaging has not changed: clearly communicating the inherent Differences between your store and the competition will empower your marketing efforts and dollars to attract more customers than your competitors.” This, according to Chris Anderson at Anderson Advertising, a 30-year agency in automotive marketing.

It’s clear that auto brands have survived ups and downs in the market and other crises before, but COVID has thrust the auto industry into a new paradigm of doing business. Brands that will develop an e-commerce foundation, power of the program, and deliver tireless marketing will be the ones that succeed in the future.

C O N T R I B U T O R   B I O

Alex Melen is an Award-Winning Entrepreneur & Keynote Speaker. He is the founder of web hosting company T35 Hosting (founded 1997) and co-founder of advertising agency SmartSites (founded 2011). SmartSites now manages over $50MM/year in advertising spend and has six offices and over 140 employees worldwide. SmartSites has been featured in the INC5000 for four consecutive years as one of the fastest-growing digital agencies and Alex has been featured in Business Week’s Top 25 Entrepreneurs, Bloomberg, Forbes, and NPR.

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