The world in which we live has altered dramatically thanks to the advent of game-changing companies such as Airbnb, Uber and Spotify.
Today, a similar scenario is set to unfold within the automotive industry; in fact experts predict that, by 2023, the industry as we know it will have dramatically changed, says AutoTrader CEO, George Mienie.
Here are some likely developments to rock the motoring marketplace that will have you buying cars very differently in just five year’s time.
- Negotiating on price will likely be gone
“In five years from now, price negotiation could very well be a thing of the past, as dealers adopt a no-negotiation policy,” said Mienie.
Neil Smith from Imperial Cars, a United Kingdom (UK) based dealership said that they adopted a no-negotiation as a way to build trust with their customers. “Many consumers are turned-off by the haggle and don’t enjoy the process”.
He said the price that a customer sees on their website is the price that they will pay.
Would this approach work in South Africa?
AutoTrader’s recent poll results show that just over 50% of respondents said they found price negotiation intimidating and the remaining said they found it a joy.
“The results were surprising for us, as we initially thought price negotiation was a pleasurable part of our culture,” Mienie said.
“It appears our European counterparts are capitalising on a growing global consumer trend,” he said.
- You will know how the dealership calculated the price of the car
Transparency in pricing is inevitable.
“Consumers know that dealerships make profit and they are accepting of this. But, they want to know how a dealership arrived at that retail price. They will demand transparency – and dealerships will have no choice but to deliver,” Mienie predicted.
- You will find your car in a shopping centre
Dealership walk-ins are decreasing. In 2015, South African consumers visited three to four dealerships prior to purchasing a car. Now in 2018, they only visit one or two. “This is because the tech-savvy consumer comparison shops online. He or she is very knowledgeable and, once on the showroom floor, is ready to buy,” Mienie said.
Dealerships will utilize the high footfall shopping centres enjoy, to improve on their dwindling walk-in figures.
This trend has already caught on abroad where Subaru has opened a dealership in a shopping centre in Melbourne, Australia; Hyundai has opened a dealership in a shopping centre in Kent in the United Kingdom; and Tesla has a dealership at the Westfield Shopping Centre in London.
“More recently Mercedes-Benz experimented with pop-up stores in shopping centres in the American cities of Atlanta and Miami. Now it will open a store in a mall in Chicago,” Mienie said.
- Clever online tools will assist you in your car shopping process
A range of online tools and metrics will be used by the digi-savvy dealer to support their sales team and to help you to buy the car of your dreams. Already, automotive live chat software is starting to play a role; capable of answering product-related questions and booking a test drive.
It’s clear, the automotive industry is changing at an accelerating rate, and the car buying customer is in for a real treat, Mienie said.