As with many things throughout 2020, the way people buy cars has changed dramatically. The traditional experience of going to the dealer, meeting with a salesperson, sitting at their desk, walking around the lot, going on a test drive with them, and then meeting the finance manager has been turned upside down. Now with lockdowns, physical distancing, mask mandates, and the rapid growth of online shopping; people are seeking a more digital experience when it comes to buying their next vehicle.

While this trend has been put into overdrive due to the COVID-19 pandemic, it’s likely a trend that’s here to stay as buyers adapt to modern, convenient ways of shopping. For example, Tesla has always offered a more online shopping experience rather than a traditional dealership model. Their brand is strong with a dedicated following despite having lower than average scores in areas like initial quality. This goes to show consumers are willing to pay tens of thousands of dollars for a vehicle through a purchase experience that is unlike what they have come to expect.

So, what does digitizing the car buying process look like, and why are consumers changing the way they make these major purchase decisions?

This Trend Has Been Building

As mentioned above, Tesla has largely adopted a digital car buying experience. Many people buy their Tesla without ever having driven one. This is very much unlike most other car buying experiences but it aligns with the way consumers shop for nearly everything else from clothing to electronics to appliances. In fact, 60% of Canadians would prefer an online car buying experience. COVID-19 may have forced many dealerships to move to a more digital experience but this trend has been underway long before any lockdowns or mask mandates.

Why are people so eager to buy a vehicle online? This kind of experience seems to fly in the face of what everyone has come to know and expect about buying a car. Many people set aside entire days or even a whole weekend to visit dealerships, see the vehicles in person, test drive them, and then make their decision. It’s a huge purchase after all, why buy a vehicle sight unseen?

A lot of this may have to do with how consumers do research. With the rapid growth of the internet, it’s easy to find any number of written reviews, YouTube video reviews, photo galleries, and online forums dedicated to a specific vehicle model. People are far more likely to do their own research online and trust expert reviewers when making a buying decision than ever before. The typical consumer may get more helpful information watching a professional auto reviewer drive a vehicle and share their thoughts than they would from driving the vehicle themselves.

So, with all of that in mind. Why spend a day at the dealership? Why not make buying a car like buying other big-ticket items like a television?

Online Vehicle Shopping is Growing

Tesla isn’t the only company seeing benefits from a change in consumer habits. Online auto buying companies like Carvana are seeing their sales grow as much as 13% quarter to quarter. The COVID-19 pandemic certainly helped with this as people opted to shop at home rather than at a physical location. These online companies have created policies to help soothe the concerns many have when buying a car online. With free 7-day return policies, free delivery, and other e-commerce-like shopping experiences; consumers can feel confident making their big purchase online.

It’s not just tech startups that are making the move to online sales, either. Major dealership networks are rapidly transitioning to digital car buying experiences with their dealership networks supporting their increasingly online-focused clientele. This omnichannel service style is the future for all major retailers, regardless of the product they sell and forward-thinking auto dealers are getting ahead of the trend.

Physical Distancing Has Forced Digitization

Whether dealerships want to or not, physical distancing has forced the digitization of many aspects of the vehicle purchasing process. Test drives are being pre-booked online, digital pamphlets have replaced physical ones, and documents are being signed digitally rather than in-person in the finance office. Many of these changes are likely to stick around in some form even after the physical distancing requirements are long gone.

COVID-19 has changed the auto buying experience forever. The dealerships that embrace this trend are likely going to see more success in the coming years when compared with those who refuse to adapt.

Transitioning to a Digital Car Buying Experience

Many dealerships already have some of the essential tools in place to begin a transition to online auto buying. Websites complete with high-definition video tours, online booking forms for test drives, and even free doorstep delivery are all quickly becoming standard.

To complete the digitization process and bring your dealership to the laptop or smartphone of the online car buyer, contact the experts at First Phase Data today.