In today's digital-first world, consumers expect experiences characterized by convenience and personalization. In the automotive industry, efforts to integrate digital capabilities across the retail landscape are becoming increasingly urgent for automakers who want to remain competitive.
Digitally native electric vehicle entrants are refining this digital model, but face unique aftermarket, incentive, and pricing challenges. His traditional OEMs have started digitalization efforts. This process requires leaders to migrate their legacy systems and fundamentally transform every element of car purchasing.
To inch closer to adopting a digital buying experience in the auto industry, leaders must first understand what is driving this transition and how they can successfully implement efforts to meet customer expectations. is needed.
Powering digital transformation
As with any retail business, the customer is key. Automakers recognize that today's consumers want easier, faster, more personalized service from the brands of their choice, and are willing to pay for it. became.
Using the digital native model is very intuitive and allows for customization not available in the traditional dealership model. The dealer model requires potential customers to go to the dealer, check inventory to determine availability, choose from existing selections, and participate in price negotiations.
Consumers can now search dozens of brands digitally, saving time and money while seeing more choices. In digital retail, vehicles are custom-built to the customer's unique desired specifications.
move the needle
one time why If the issue is resolved, organizations should plan to: how Meet these new digital demands. Traditional OEMs need to create a roadmap for implementing the direct-to-consumer models currently offered by innovative EV startups coming to market. This simple, fully digital purchasing experience extends from online configuration and pricing to captive finance integration and home delivery options.
Many traditional OEMs have already begun to improve their new and used car online sales experience by investing in best-in-class online retail tools that enable a mobile retail experience. The key to future success for these OEMs is modernizing the configuration processes that are fundamental to the customer experience. By integrating features like 3D visuals and VR, consumers will be able to truly build their dream vehicle from anywhere in the world.
Additionally, automakers must offer a seamlessly integrated, multichannel, unified shopping experience that incorporates features such as home delivery and aftermarket services. OEMs should reward loyal customers by tailoring offers to their personal preferences using customer opt-ins that provide a central view of drivers and their purchase history.
Benefits of digital experience
Digitalization of automotive retail has several important benefits:
- Modernize CX: Increase brand satisfaction and loyalty by having a single view of your customers and integrating purchasing, financing, shipping, logistics, warranty, and service.
- Improving consumer engagement: Educating customers about your product offerings and providing an immersive experience allows buyers to personalize their car, increasing purchase price and positively impacting retention.
- Focus on sustainability: Moving to bespoke systems offers significant environmental benefits across several key aspects. This model significantly reduces the negative impact of logistics, as vehicles are delivered directly from manufacturing to the consumer. Beyond shipping, emissions from physical travel to and from the store and paper waste from face-to-face transactions are also eliminated.
- Increased revenue: Launching a seamless digital experience will drive customer retention and upsells, and drive strong financial results.
Challenges associated with digitalization
As with many new technologies, there are hurdles to overcome. For example, his OEM, which relies solely on a build-to-order approach, is limited to new vehicle offerings, which limits its customer base and turns away customers interested in used vehicle options.
There are also challenges associated with the digital purchasing ecosystem. There is no doubt that the technology necessary for a digital transition exists, but integration is a major challenge. For example, many OEMs now have online configurators that allow potential customers to visualize vehicle specifications, colors, interiors, etc., but do not have the skills to convert that design into an order. . Traditional OEMs continue to struggle with establishing seamless, integrated capabilities to bridge the gap between idea and purchase.
For OEMs that can facilitate this process, it typically takes several months for a personalized vehicle to be manufactured. For many consumers, this is a low price to pay for complete customization, but the long wait time may deter some and opt for something more easily available.
These challenges, while not insurmountable, prove that the entire automotive industry has a long way to go before vehicle purchasing becomes digitally native.
Modern vehicles have been likened to smartphones on wheels, becoming more intelligent with each passing year.
To keep up with these future tech-savvy vehicles, OEMs must put legacy models behind them and transform their retail models to be digital-first. Leaders should start planning strategies to maximize the benefits while brainstorming innovative ways to overcome hurdles.
andy howard (Photo, top left) He is responsible for Automotive and Industrial Equipment for Capgemini Americas.
