Inside the Brick-and-mortar: Embrace Technology, Boost Customer Satisfaction
Technology has become an integral part of almost every kind of shopping experience. Whether it's buying merchandise from an online retailer (such as Amazon or eBay) or scanning an item's bar code to determine its price at a big-box store (such as Wal-Mart or Target), technology usually plays a role.
Not so with auto dealerships. It's true that many car shoppers use technology when researching which automobile to buy. For example, shoppers often investigate vehicles and dealerships online on their computers or smartphones. They often decide on features they want and compare prices from dealership to dealership. But when customers visit the showroom, their shopping experience usually isn't much different from what it was a generation ago.
What the scores say
A new study indicates that dealerships could benefit tremendously by incorporating technology into new-car shopping. Using technology such as tablets and computer-equipped kiosks during the sales process can substantially boost customer satisfaction scores, according to the J.D. Power 2015 U.S. Sales Satisfaction Index StudySM.
What's more, dealerships that don't incorporate technology into their sales processes risk losing business to those that do. (For more study findings, see "Study supports sales-related upgrades.")
"Customers are experiencing interesting uses of technology in many of their other retail transactions and now they expect this when shopping for an automobile," said Chris Sutton, vice president of the automotive retail practice at J.D. Power. "Dealerships should understand that customers want and trust technology, and that it can enhance efficiencies."
Not surprisingly, young car buyers — Millennials (also known as Generation Y and defined in the study as those born between 1982 and 2004) — are especially receptive to technology. In fact, they are the single most impactful generation on the automobile market, accounting for 29% of new-vehicle sales, according to data compiled by J.D. Power.
How to use it
Among the best ways to incorporate technology into new car shopping is for your salespeople to use tablets when interacting with customers in the showroom. Sales staff can use them to:
- Demonstrate vehicle features and benefits,
- Record customer preferences and needs,
- Display pricing information, and
- Preview the vehicle before a test drive.
Tablets also can be used as part of the "walk-around" after a customer buys a new vehicle. For example, the customer and salesperson can compare features and benefits listed on the tablet with those on the vehicle itself.
"Using a tablet conveys a strong sense of professionalism and tech-savvy that is lost when salespeople simply write these things down on a notepad or try to memorize them," said Sutton. Despite all of these potential benefits of using tablets, however, only 16% of salespeople use them during the new vehicle sales process, the J.D. Power study found.
Placing interactive kiosks with computers and video monitors on the showroom floor is another way to incorporate technology into the new car shopping experience. These can enable customers to watch videos featuring cars they're interested in, as well as conduct research and read reviews of vehicles right there in the showroom.
There's also a place for these kinds of technology tools in your service and F&I departments. For instance, to ease customers' concerns and anxieties, service technicians can use tablets to show pictures and better demonstrate the need for certain kinds of repairs. And, through the use of charts and graphics, tablets can make it easier to explain the often confusing details and nuances of F&I products.
To get the most benefit out of these technology tools, make sure the data you capture is integrated into your dealership management system. This way, you can use the information to improve decision-making all across the business.
Adding technology tools such as these requires a commitment of both money and time. But doing so could pay off significantly in terms of higher customer satisfaction, more repeat and word-of-mouth business and increased sales.
Sidebar:Study supports sales-related upgrades
The J.D. Power 2015 U.S. Sales Satisfaction Index StudySM makes a strong case for updating dealership technology to give customers a more satisfying shopping experience.
For example, when salespeople used a tablet to record customer vehicle needs, demonstrate features and display pricing information, they achieved a customer satisfaction score of 8.12 (for nonpremium brands). When they didn't use a tablet, the customer satisfaction score dropped to 7.02.
Also noteworthy: When salespeople presented customers with handwritten price quotes, there was a -0.55 point gap in customer satisfaction compared to when quotes were presented to customers on a tablet or computer screen.
In addition, the study revealed that, when F&I product, pricing and payment options are presented to customers on a tablet or computer screen, customer satisfaction is higher than when this information is presented in other ways — including via printed materials, handwritten figures, or verbal quotes and descriptions.
Automotive Dealer Insights - May/June 2016