Reflecting on six years at Somo
Somo's US-based Product Director reflects on his journey so far at Somo, and what he has learned along the wayRead more
It has been suggested that new car registrations in September could see a rise of 25%, and with the current supply issues the industry is seeing due to the closure of factories in light of COVID-19, this could have been as much as 40%.
It’s great to see the automotive industry booming and the demand for new cars increasing. On the flip side, the competition in the market has also grown, with a number of OEMs now selling cars directly online, rather than solely through traditional dealerships. This poses a conundrum for a lot of automotive dealerships in the UK and around the world. How do they ensure that they make the most of this demand in a highly competitive environment?
The OEMs selling online is a direct response to changing customer behaviours. Customers are much more comfortable researching and purchasing high ticket items online than they were only a couple of years ago. COVID-19 has actually accelerated the consumer transition from physical to digital – and it’s highly likely these new behaviours are going to stay well beyond the pandemic.
In a recent Somo survey, we asked over 1,000 consumers who were considering buying a car in the next 12 months about their plans and how they feel about the current experience. Over 75% said they would like more of the car buying/leasing journey to be online. A further 55% said they’d be happy to do a virtual viewing/test drive of a car in the initial stages of making a choice.
Importantly for the traditional dealerships, a number of respondents who were keen for going online said they’d still visit the physical dealership to complete the purchase/lease.
This cannot be taken for granted though, and the data continues to show a shift towards a fully digital car-buying experience as customers are becoming more and more comfortable with this type of purchase. It’s key that the traditional dealerships recognise this and provide their customers with experiences they expect, both online and in the physical dealership. Without designing and developing the right digital environment and experience for customers, there is an increasing risk that market share will not only be lost to other dealerships, but also to the OEMs who have already recognised this shift.
The automotive industry seems to have weathered the initial storm in light of the COVID-19 pandemic – the stats on new car sales this month are hugely positive. As the industry continues to see a transition from petrol to hybrid and electric, equally there should be just as much of a focus on how dealerships and OEMs convert this increased demand through engaging, efficient, and revenue-driving digital products and experiences.
Somo is a digital product agency highly experienced in designing and developing market-leading digital strategies, products and experiences, delivering digital ambitions at pace and scale.
Over the past 10 years, we’ve worked with a host of global brands and cool start-ups, including the likes of Audi UK, Audi of America, ŠKODA and Jardine Motors Group, helping them create digital solutions for both their customers and employees to drive greater engagement, efficiency and revenue.
If you’d like to set up a Zoom call to talk through the best options for your organisation and see how Somo can help you, please get in touch via our Contact Us page.