The New New – changing face of Automotive

During the COVID-19 crisis, the lockdown has accelerated the need for digitalisation of marketing and sales at a speed and scale that nobody could have predicted.

Automotive is no exception, the pandemic means the sector needs to reinvent itself and at speed. It is essential businesses overcome challenges through innovation – and literally to start to redefine the future of their operations. The lockdowns and subsequent restrictions mean the way people go about their every day lives has changed.

The action taken around the world by governments has been extremely disruptive. Most retail environments have reacted quickly. Almost every product and service can be bought online, digital sales and marketing channels are robust.

Automotive lags behind, although many have digital assets, the digital and sales channels are not truly integrated and now limiting in this new and significantly altered environment. Digital does not support the full engagement and sales process. Something totally understandable, automotive a sales environment historically focused on a contact based sales and marketing approach. The sales process directing towards a showroom visit, test drive and signed order.

Cars are traditionally a product customers have been guided to look at in person, to touch and try out. The sales process has always supported this, sales typically directed by a person behind a desk in a showroom. The big question comes: How can dealers continue to sell cars when their customers’ overriding priority is to keep their distance, not touch and try to stay at home as much as possible?

Crises have always been known to accelerate the development of new ideas, to stimulate and drive innovation. This one is no different. You only have to look at how businesses in China have reacted to the lockdown and what is happening as they start to emerge to a more open environment. Simply put, It is not a time to do nothing. Businesses who do not react now are quickly going to find themselves struggling to survive. The disruption has been too far ranging.

There is a need for an accelerated digitalisation of marketing and sales in the auto industry and at a speed and scale that nobody could have foreseen. OEMs and retailers need to focus on innovation to engage customers and, ultimately, continue to sell cars.

One aspect that has not changed. Strategically businesses need to think about engagement. To sell you first need to engage. The customer experience needs to now be governed and managed using digital platforms and tools.

In China, brands like BMW now offer an online digital showroom experience that is integrated with WeChat, enabling customers to instantly engage. This enables real-time interaction through one-to-one video calls between customers and BMW product experts. Customers are guided through the showroom by sales people with whom they can interact, able to view different models and see the prices at the same time.

Tesla has started offering contactless test drive options to customers in Beijing and Shanghai. Customers can make appointment by phone and sign e-agreement online. A Sales person is able to unlock a car remotely, the customer can watch an introductory video on the centre screen before setting off on a test drive.

Without doubt some of these activities will be valuable in ushering in a path to recovery for this industry. But rather than thinking piecemeal and implementing a series of tactical activities it is important OEMs and retailers think strategically and focus on the new Customer Experience. This thinking needs to be end to end. Not just the customer, the business also needs to adapt – the thinking has to be business wide. The sales team need to refocus and adapt to the new environment, as does Aftersales. Almost certainly new approach and revised skills will be required to manage the shift away from “contact based sales” to a low or no touch sales and operating principle.

It is essential for retailers to extend the reach of their showrooms and in essence now consider taking their presence directly to the customer. Showrooms need to go online. Dealership and Aftersales events held digitally. There is the opportunity to digitalise every aspect of the Customer Experience.

Adopting new marketing vehicles designed to engage such as: tailored video marketing of new and used vehicles, adopting new methods: customer interaction through intelligent chat and artificial intelligence (AI); promotional and sales methods such as online bidding, through to valuation and financing options to facilitate transactions. Businesses need to consider a full spectrum of tools.

As well as greater digitalisation, it is ever more important to pro-actively analyse consumer behaviour and sales metrics, or work with those that can help understand how to effectively, it is essential to be agile and open to adapt. Use data and information to seek out early warning, provide diagnosis and generate intelligent suggestions and actions.

There is expertise and support out there. Organisations like Centro Consulting are being engaged to help advise on how to successfully come out the post Covid lockdown. They are working with OEMs (Original Equipment Manufacturers), NSCs (National Sales Companies) and local Retailers to help prioritise, adapt sales processes and adjust to the new operating environment through Connected Learning.

Martin acts as a Senior Consultant of Digital at Centro Consulting: A world class Automotive consulting company. Centro Consulting

Martin Wilson at Indigo102.