Sustaining dealerships – by Al Masaood Group’s Marwa Kaabour

Al Masaood Group’s group head of marketing and corporate communications, Marwa Kaabour, examines how the car buying experience has transformed, and what this means for marketers

The world of automotive sales is becoming ever less the domain of large state-of-the-art multi-story buildings with sharp-suited saleswomen and men running customers through an in-person pitch about the latest car model’s sizzling features, and negotiating their way to seal a deal.

The dealership model has been around since the 1800s, and for as long as we remember they represented a milestone in the lives of everyone. Who wouldn’t remember their first car purchase? Times have changed. An explosion of innovations is cutting out the middlemen.

The digital revolution and climate change are disrupting the mobility scene. Several internal and external challenges are jostling the way dealerships sell and conduct
their marketing.

The most prominent of these are:
Customers’ increasing inclination to receive Amazon-like services. The new breed of digital natives is precious about their offline time. They’ve put their trust in the screen world and want to shop for their expensive gadgets online. In one sitting, they go on to surf multiple showrooms, deals and offers of car dealers.

With this comes the popularity of online multimodal mobility platforms with fully digitised customer journeys and multi-brand offerings.

This same digital native breed is awestruck with how badly their predecessors have handled the environment. With wildfires, heatwaves and floods, and increasing pollution, they have taken it upon themselves to prevail as the saviours of the planet. This more of a survival tactic rather than one adhering to Maslow’s principles of self-actualisation. The new generation is open and ready for hybrid and electric cars. The power and roar of the propulsion engines may not guarantee a sale, certainly not with the spiking increase of fuel prices. The sales and marketing narrative will change and may be less about the product, but more about its benefit and environmental impact.

And from this we arrive at the hot topic of ownership, as the world sees that customers today may drop the need to own a car and rely on shared mobility such as public transport, ride-hailing, leasing and subscription models.

There is plenty of action to come from dealerships as they ride this wave of change. The dealership model that survives on inherited technology can no longer depend on bulk and aggressive advertising to sustain sales. Automotive marketers are building new avenues of sales and will need to upgraded digital experiences to enhance their relationships. This means fully digitised customer journeys, virtual sales and seamless online showrooms, even metaverse ones.

Here are the latest developments in online automotive sales:

Car configurators: allowing buyers to customise their cars from the ground up; the interior and exterior colours, fabrics, accents.
Price transparency: with e-commerce portals allowing user full visibility of car prices, shoppers can easily compare car model prices.
Online financing: gone are the days of endless bank paperwork and applications. Dealers today allow users to apply for financing, choose the banks and rates they prefer, and enjoy an easy and seamless car purchase process.
Online insurance & registration: buy the car online and receive it registered and ready at their beck and call.
Delivery to the house: and just like that, from the couch in shoppers’ living rooms, dealers today will deliver the car to their doorstep, after they selected it, financed it and got it registered. All in a few clicks.

The marketing mix will turn digital and will require investments in online sales and after-sales platforms. Dealerships will start downsizing physically and upgrading technologically. Marketing will also move to an engagement hub, with the marketing KPIs shifting from superficial measurement of leads and conversions to customer engagement indexes.

For dealers to address the usership cannibalisation, they will need to revisit how to sell and promote their fleet. This means introducing full-service leasing and subscription models as opposed to selling one model at a time. The marketing of these products will require highly engaging user-generated content and smart mobile advertising. Technology investment in fleet analytics is expected to rise, and with it the hot topics of user privacy and data protection.

The overall bubble seems to put the longevity of the relationship with the customer at risk, and with this comes the need for new branded schemes. It also means being more available socially for your customers. In this day and age, customers have become expectant of digital selling modes such as live selling and WhatsApp selling, as well as the very powerful digital version of word-of-mouth: user-generated content.

With this mass change comes ample opportunity. This is not the end of the model; it is in fact the metamorphosis stage. The world’s population is growing and so is its urbanisation. As of last year, the industry has invested more than $2.7 trillion into selling the fulfilment of owning a car, and this is not going to change soon. It will, however, transform to more in-time, pay-per-day and 24-hour availability messaging that would ward off the threat of extinction.