The automotive industry has undergone some changes in the past few years. The COVID-19 pandemic accelerated the adoption of new technologies to improve customer car-buying experiences, and there’s no sign of this slowing down.
Car manufacturers and dealers must utilize new technologies to reach their customers in different ways. Many industries are willing to integrate advanced software systems to drive business growth and achieve enhanced interactions.
Here’s a brief history of car-buying and some examples of new tech that has inevitably changed the way customers research and decide to purchase cars, both new and used.
Purchasing a car has undoubtedly changed in the past hundred years. From going down to the local factory to visiting dealerships to buying an electric vehicle (EV) online and having it delivered to your home, the ability to buy a car has become almost effortless.
Car-buying began back in the 1880s and grew rapidly over the next two decades. More than 60,000 automobiles were being built annually in 1903, a momentous milestone for the industry. At first, manufacturers sold these vehicles directly to the consumer — dealerships did not exist.
As time went on, the World War II car boom was driven by soldiers coming home to their families. More people were financially prosperous, meaning they had the funds to purchase their vehicles. This led more people to travel by car than older transportation methods, such as walking or taking the train.
The idea of leasing a car became popular in the 1970s after the industry faced an oil crisis. Consumers liked the idea that they could drive their vehicles without having to make a financial commitment.
As the world shifted into the digital age, the introduction of the internet changed the way people purchased and sold goods and services, and the automobile industry was no exception. More consumers had opportunities to educate themselves on the features and specifications of cars they were interested in, which meant buying behavior would change as a result.
As government officials and public and private investors invest in the future of EVs, we can also expect to see more eco-friendly vehicles take over the industry and become a staple for many households.
Technology leads to industry expansion and helps individual dealerships move their business forward. The automotive sector relies heavily on using the latest technology in its cars, and it also plays a factor in how people research and buy them.
Many people turn to alternative financing options when purchasing a new or used car. Dealerships do their best to help customers find the right vehicle and methods of financing it. While some people have enough savings to purchase a car upfront, others need to consider their options more carefully.
Dealerships are now using advanced software to provide guaranteed approvals. The new software allows dealerships to get their customers the lowest monthly rates, improving the CX and building a loyal client base.
More companies are adopting augmented reality (AR) and virtual reality (VR) systems to enhance customer experience. For example, BMW and Audi are using this new technology to create virtual reality showrooms.
This will likely be more than a trend, though — 80% of the future purchasing generation will want to visit stores that offer such immersive experiences.
Virtual showrooms offer customers more information about the car they’re interested in, which helps drive purchase decisions and potential referrals in the future. It also adds a factor of fun to the car-buying process.
According to J.D. Power, 45% of consumers express comfort when buying a car over the internet. It’s also becoming more common for people to use online resources as their starting point when researching what kind of vehicle they want.
Manufacturers are investing in their websites to appeal to a broader range of consumers, helping drive sales and get people interested in their models. Companies like TrueCar and Carvana are carving out their place in the automotive industry because they offer contactless home delivery services.
A customer can now visit a website, search for a car they want, order it and receive it in their driveway in a matter of a few days. This is something that’s transformed the industry and will continue to in the future.
The automotive industry wouldn’t be where it is without implementing the new technologies listed above. Whether a virtual showroom or delivery service, the car-buying experience has been elevated to meet customer expectations.
Manufacturers and dealerships must be willing to incorporate new technologies into their business processes to increase revenue. Customer experience will remain a top priority in the industry’s future, and expectations will likely change as time moves on. Customers want personalized experiences, and car dealers need to accommodate those expectations. Buying a car is a significant investment that takes time and patience, and now, buyers have a world of resources and options at their fingertips.
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Last Updated on August 20, 2021.