Chad and Barbara Stoddard of Kirkland did their homework when it was time to buy a new car. They attended the Seattle Auto Show. They asked their mechanic for recommendations. They logged on to their insurance company’s car-buying service. They visited several local dealerships.
The data they gathered led them to purchase a Hyundai Santa Fe from Ford-Hyundai of Kirkland. The Stoddards’ due diligence made the car-shopping process, long a dreaded experience for many Americans, smooth and stress-free.
“Five or six years ago, when you’d walk in to take a test drive, (salespeople) would be all over you,” Chad Stoddard says. “This time, no one really pressured us at all. It was pretty easy.”
The Stoddards’ experience is becoming typical as franchise dealers respond to improved consumer awareness, changing automobile technology, and manufacturer-direct selling.
Twenty years ago, the average customer at Lexus Bellevue was a 55-year-old white male, says Mark Babcock, the dealership’s general manager. Now, the typical car shopper is about 37 and increasingly female. Also, increasingly savvy.
The Internet has leveled the playing field between buyer and seller, arming customers with vehicle pictures and videos, price comparisons, and detailed financing options. Shoppers today visit only one or two dealerships before buying a vehicle, compared with three or four dealers a few years ago.
“Now, if they walk into your dealership, the odds are in your favor,” Babcock says. “But salespeople have to be educated.” So, too, does the service department. With the integration of technology such as on-board computers, GPS, and security systems, “it’s not just getting your hands greasy and turning a wrench any more.”
Auto companies are increasingly making driving a digital experience. “Infotainment” systems that combine stereo and Mark Babcock, general manager of Lexus Bellevue, says today’s customers are better informed than in years past.GPS systems with cellphone compatibility are becoming commonplace, and the pace of digital innovation in the automobile is quickening. At this year’s Consumer Electronics Show in Las Vegas, automakers rolled Apple- and Android-run dashboard computers, self-driving vehicles, and cars that can be hailed with a smartwatch app.
Direct selling, the sales method favored by Tesla, is also gaining popularity. But dealers maintain they will always be needed because they provide transparent buying and financing, a market for trade-ins, face-to-face customer service, and financial support for local communities.
“The question to me isn’t to franchise or sell direct … it’s about the value added by dealers in the eyes of consumers,” Jim Lentz, CEO of Toyota North America, said last spring at a convention of the Washington State Auto Dealers Association. “Improving the customer experience is more important today than ever.”