Balancing revolutionary technology with distinctive CX skills is the future of Canadian automotive retail
The current priority for the Canadian automotive retail industry is to make the purchase and service cycle as convenient as possible for the consumer. There is no doubt this will help overcome challenges (from changing sales models to the hangover of supply chain issues) as well as unlock new opportunities (from self-serve to personalization). However, it is also important to remember that buying a car is an emotional and exciting experience, often the second biggest purchase someone will make in their lives.
Putting the consumer back in the driving seat
I have noticed that, as Canada has emerged from the pandemic, managed inventory challenges and the turbocharging of digitalization mean that automotive retailers have become a lot more transactional in their interactions with consumers. By necessity, salespeople became – or were recruited as – order-takers. When a customer came in and there was a long waitlist for inventory, sales skills fell down the ladder. But that is changing again. With supply chains up and running, and inventory issues in the past, consumers are back in the driving seat. Now is the time for the industry to respond.
Harnessing technology will be central to this response. Understandably, given the advances in CX in other retail sectors, car buyers are becoming more demanding about how dealers communicate with them and what that process looks like. From the start of the ownership journey, the consumer discovery phase to when their vehicle is serviced or traded in, CX should be consistent and seamless. It’s all about Experience-First and how retailers can maximize existing and emerging technologies to transform every touchpoint, building trust, loyalty, and long-term customers.
It is time to focus on the consumer’s ideal journey, whether that is in person or online, digitalized, or analogue, high touch, or self-serve.
It is important that we deliver exceptional customer experiences (CX) across all touch points, whether on or offline. This is the core to Experience-First, and what we are focused on delivering in the months ahead.
Consumers are taking the journey online
Like other large countries, we have our regional differences. Our weather can be extreme, and the distances between places can be vast. That plays its part in influencing consumer behaviour and preferences. Rural retailers are often a well-known part of the communities they belong to, and business is based on personal connections and relationships. In the metro centres attracting and keeping customers is more about new technologies and having a forward-thinking approach. However, both expect, and deserve, a standout experience when purchasing or servicing their vehicle.
These days, consumers conduct much of their initial research online, but they still want to come into the retailer to touch and feel the car and participate in the process in person. This presents a clear opportunity for automotive retailers to help consumers seamlessly transition between the two worlds, opportunities not always capitalized upon. Online requests can be missed or are not responded to in a timely and personalized manner; communications are splintered across email, phone, and text; data is not joined up, with buyers repeatedly asked for the same information in one buying cycle. If we are to show consumers that we are truly listening to them and interacting in a way which honours their best interests, we need to perform at every touch point.
Dealers and OEMs have a tremendous amount of customer data, and so much of it is currently untapped, mismanaged, or misused. For example, I still get emails asking me if I want to trade in a vehicle that I have not owned in four or five years. I keep telling the retailer I no longer own this vehicle. Yet I still get the emails.
Experience-First changes the conversation
One of the most exciting opportunities we have seen from our Experience-First blueprint is the fresh conversations it is opening up at the most senior levels of the industry. For us at Keyloop, it’s a much more exciting way of working. Instead of going to a customer to see if they are interested in a particular product, we can offer them a strategic partnership. We ask them about their priorities and share how our vision can fit their needs today and in the future.
When we look together at what we can do for them, we ask: “How does this work for you? How can we help you to enable growth? Where do we need to make changes? What is the best way of working with you to deliver what you need?” The Experience-First concept has led to the conception and imminent launch of our “Fusion” Automotive Retailing Platform which has enabled us to align more closely with our customers and work out together how we can add solutions that meet their market needs. And the response has been phenomenal.
We are working with very forward-thinking retailer and OEM partners who share our vision and are driving towards similar market goals. These important conversations are part of helping businesses transition to a different future. This is a journey for everyone, and Keyloop is uniquely positioned to help deliver it faster and better than anybody else. We get the fundamentals right so there is a strong, integrated, and secure digital foundation to build on. We won’t ever reach an “end state” because by the time we achieve today’s future goals, there will be more to aim for.
The Experience-First concept has led to the conception and imminent launch of our “Fusion” Automotive Retailing Platform which has enabled us to align more closely with our customers and work out together how we can add solutions that meet their market needs.
Blending the new with the old is the secret to future success
In a fast-paced, performance-driven environment, there is natural staff turnover, and many current salespeople only started selling cars during or shortly after lockdown. They have not had the experience of a ‘normal’ market. And now they are having to learn how to sell, having been used to a much more transactional, order-taking process. So, we have a cohort of young, smart entrants to the business who are good with technology but have not yet been able to flex the fundamental selling skills needed to lock in long-term customers. They are having to learn to create relationships, build trust, and add to their market knowledge.
Of course, there are still many experienced salespeople who have been working in the industry for years. Building direct customer relationships is in their blood. This makes for an interesting showroom dynamic, and key opportunity in our market. We need to bridge these two worlds, to unite two invaluable skill sets if we are to deliver a standout CX to car owners across the country. The right technology is the key to forging this connection, and it needs to work for everyone in the retail ecosystem. The solutions for retailers should be just as seamless and convenient as they are for consumers.
We are designing Keyloop systems that are intuitive and user-friendly for dealership employees, making it easier for them to successfully adopt and embed them, and deliver better customer experiences.
The solutions for retailers should be just as seamless and convenient as they are for consumers.
Vehicle leasing and the used car market
Another shift in the market that OEMs and dealers have had to work through is the increasing numbers of customers switching from leasing to purchase. Traditionally, Canada’s been strong in short-term personal leasing, with customers flipping their car every two or three years. Suddenly, people are now buying out their cars, as higher interest rates and inflation have meant payments going up, or vehicle specifications going down.
This makes connecting with customers more of a challenge for dealers and OEMs, and this is where having good visibility of accurate date will help. To market to these consumers, retailers need to know exactly what their current situation is if they are to produce an offer that compels a consumer into a new vehicle.
Over the past few years, thanks to the issues with new car inventory, the Canadian second-hand car market has been massive. Used vehicles were in extremely high demand and retaining their value well. That is starting to balance-out as new car inventory and programs are getting stronger. But there is still a way to go, so the used car market remains strong.
There are two categories of used vehicles that retailers are focusing on. One is new lease returns, and vehicles that they can resell, finance and, offer extended warranty on. The other is targeted at consumers who cannot afford something expensive, making the $10,000 range a great niche market for dealers.
For both categories, retailers need a good process for appraising used vehicles, and communicating value clearly to consumers. A considerable proportion of car buyers do shop around and will send requests for quotes, and quite often the industry makes that process more difficult than it should be. Some dealers are open about pricing and how they present that, while others are closed, forcing consumers to visit in person for appraisals or to negotiate discounts.
I have gone through a couple of purchases recently myself, and even with all the industry knowledge I have, it still seemed confusing. You go from one dealer to the next, and it’s a completely different process with wildly different numbers on trade-in value. So, there are opportunities here for automotive retailers to set the standard and apply the right technologies and processes to make the used car market more transparent and seamless for buyers and sellers.
Harnessing emerging tech, for the right reasons
There is no doubt that there are opportunities for integrating AI and other emerging technologies like VR into the consumer journey – early adopter retailers are watching this space closely. AI offers immense potential when it’s done right. But it needs to deliver value. A lot of companies are adding it to simply “check the box” so they can say “We have AI.” But what does that really mean? – what is the purpose and the outcome? We are working with several companies and systems globally to help our teams leverage AI to build on our Fusion Automotive Retail Platform, where it makes sense and adds value to our customers. This is no box-checking exercise: we want to be sure it delivers value to our customers and their customers. We are not there yet as an industry – it’s going to take time. But I think it will have the most impact in supporting OEMs and our customers’ teams in dealerships.
Transitioning to Fusion puts the customer first
The best CX is the one that achieves the right blend of technology solutions and person-to-person service. To do this successfully, you need to know which touchpoints in the consumer journey should be automated, and how, and which should be delivered in-person. You then need to make the online (or self-serve) experience as good as the in-person, white glove service.
Consumers want efficiencies and time-saving services. Yet many still want a relationship with their dealer. It is important for them to know they can still call someone if they need to, and that they will be looked after properly. Whilst it’s true that technology can enhance and unlock many of these opportunities, it needs to be built in a way which boosts the person-to-person experience, not mask it.
Three things that consumers want from their car-buying experience
|
Convenience People are busy. We need to make it easy for everyone to buy a car – however they want to do it. “Make it easy for me. Don’t throw up any unnecessary roadblocks. Do not ask me the same question four times. Do not play hide-and-go-seek when it comes to pricing.” All customers want is to feel looked after, that they got a good deal and value for their money. |
To turn to a trusted advisor With so much evolving tech in cars it is important for consumers to be able to navigate their way through using it. How can retailers help their customers uncover new things, or get the answers to their questions? Technology in cars is not going to get simpler in the future, so being able to help consumers get the most from their vehicle features will become extremely important. |
Transparency Buyers want to feel like they have made an informed choice, based on clear and straightforward information, especially when buying something as expensive as a car. Keeping them up to date with regular communication to let them know what is happening (and why) will take a lot of that anxiety away and help build trust and long-term relationships.
|
Key Takeaways:
