A guide for car dealerships on digitization
In today's digital age, it is more important than ever for car dealerships to engage intensively with new technologies and increasing digitalization. Car dealerships are thus able to improve the customer experience and save time and money. In addition, valuable insights about customers and processes can be gained from the data obtained. In this article, we look at the benefits of digitization for car dealerships and provide tips for those looking to implement digital strategies. We also take a look at specific practical examples of successful digitization projects in the automotive industry and discuss the role of electronic price tags and online stores in the digitization process. So if you're a dealership CEO or manager looking to stay competitive in an increasingly digital world, this article is for you.
One of the most important aspects of digitization is the ability to provide customers with a more seamless and convenient process for finding and buying vehicles, as well as exceptional service and convenience.
In addition to improving the customer experience, digitization can also help car dealerships save significant time and money. By automating certain tasks, such as inventory management and customer relationship management, employees can focus on other areas of the business. Digitization of analog processes enables savings in resources such as paper, warehouse capacity and procurement.
Last but not least, digitization can provide valuable insights for car dealers through data collection and analysis. For example, capturing customer preferences and behavior can help car dealerships tailor their marketing efforts, increasing the chances of closing a sale. In addition, analyzing inventory and sales data can help make informed decisions about inventory levels and pricing.
In summary, digitization offers a number of benefits that help today's dealership remain competitive in the digital age.
The advantages of digitization in the automotive trade
The benefits of digitization for car dealerships are many. There are numerous ways in which car dealerships can digitize their operations. Car dealerships can use digital tools to optimize their sales processes, for example through online financing applications and electronic signatures. Digital marketing strategies for social media and e-mail marketing can reach an even wider range of customers and thus increase sales.
In addition to these technologies and strategies, digitization can also bring qualitative benefits for car dealerships. For example, digitization helps to reduce the risk of errors and the effort required for manual processes. It can contribute to a modern, convenient customer experience and thus promote long-term customer loyalty.
But how to proceed?
A simple and cost-effective way to initiate the process of digitization is to introduce electronic price tags for car dealerships. Electronic price tags, also known as digital price tags or ESLs, are displays that show the price and information about a vehicle or service. These electronic price tags can be updated without effort and offer customers a convenient way to get the information they want. Digital price tags are particularly useful when prices are constantly changing, including, for example, in the case of special offers or discounts.
The benefits of using electronic price tags for car dealerships include:
- Quick update: Electronic price tags can be quickly and easily updated with the latest pricing information, reducing time and effort compared to replacing physical tags.
- Customer convenience: electronic price tags provide customers with a convenient way to obtain price information that always matches online prices.
- A professional appearance: Electronic price tags can give a dealership a modern, professional appearance and set it apart from the competition.
The cost of implementing electronic price tags depends on the particular system and the number of tags used. Factors to consider include hardware and software costs, installation and training costs, and ongoing maintenance and support costs. It is important for dealerships to weigh the potential benefits of electronic price signs against the costs to determine if the investment is worthwhile. In many cases, the investment in electronic price tags pays for itself quickly, as the benefits of increased efficiency, reduced costs, and reduced time and customer satisfaction can lead to increased sales and profits.
In many cases, the investment in electronic price tags pays for itself quickly, as the benefits of increased efficiency, cost reduction, and reduced time and customer satisfaction can lead to higher sales and profits.
An online store, also known as an e-commerce platform, is a website that allows customers to buy products or services online. For car dealerships, an online store can provide an additional sales channel, allowing customers to search for and purchase vehicles from the comfort of their own homes. An online store can also help reach a wider range of customers, as they can access the online store and make a purchase from almost anywhere.
Some of the benefits of an online store for a car dealership are:
- Increased sales: An online store can provide an additional sales channel and potentially increase a dealership's overall sales.
- Greater customer potential: With an online store, retailers can reach customers beyond their local area, which can increase the number of potential buyers.
- Ease of use for customers: An online store allows customers to search and purchase vehicles at their convenience. This can be particularly interesting for busy and tech-savvy customers.
As with electronic price tags, the cost of implementing an online store depends on the platform and features used. Factors to consider include the cost of setting up the site and integrating it with the dealership's systems, as well as ongoing fees for hosting and maintenance. Again, it is important for dealerships to determine whether such an investment is worthwhile. In many cases, the investment in an online store pays for itself quickly, as the benefits of increased sales and a larger customer base can lead to higher profits.
One way to make the implementation of an online store even more cost-effective is to use a B2B online store system such as DiCoSo's "DSA Online Shop". Using a solution such as DSA Online Shop eliminates the need for retailers to invest in expensive development and maintenance costs.
Overall, both electronic price tags and an online store can have a number of benefits that enable a dealership to remain competitive in today's digital age. The positive effects of these measures, such as increased efficiency, customer satisfaction and sales, often outweigh the associated costs. In numerous businesses, the investment pays for itself after a short period of time, making these strategies a smart investment for car dealerships.
Successful examples of digitization in the automotive industry
There are already numerous examples of car dealerships that have successfully implemented digitization strategies and benefited from them. Some examples are:
- AutoNation, the largest automotive retailer in the United States, has introduced a number of digital measures to improve the customer experience and streamline operations. These initiatives include a comprehensive website that allows customers to browse inventory, compare prices and complete the purchase process online, as well as a mobile app that provides access to these features. As a result of these efforts, AutoNation has seen an increase in online sales and a reduction in the time required to close the sale. In 2020, the company reported that online sales now account for more than 20% of total retail sales volume, up from about 14% in 2019.
- In the United Kingdom, the Lookers car dealership group has launched a digital platform called"My Lookers" that allows customers to digitally manage all operations related to their car. The platform includes features such as booking service appointments, checking the status of their vehicle and receiving personalized offers. Lookers has seen an increase in customer satisfaction and loyalty thanks to this platform. In 2020, the company reported that customer satisfaction with the platform was 87% and that 70% of customers who used the platform came back for additional services.
- The German automotive group Daimler has implemented"Mercedes me," a digital platform that offers customers a range of services. Among other things, the customer has the option of remotely accessing and controlling his vehicle, retrieving personalized offers and making service appointments. Daimler has seen an increase in customer retention and loyalty thanks to this platform. In 2020, the company reported that the platform had more than 5 million users and that platform users were more likely to use additional services and recommend the company to others.
- The AMAG Group, the leading automotive retailer in Switzerland, has implemented electronic price tags for all used car locations as part of its digital transformation strategy. To date, the Group has installed over 4500 electronic price tags in its dealer network. The primary goal of this project is to implement the company's dynamic pricing strategy and optimize operational efficiency.
In addition to these benefits, the electronic price tags have also had a positive impact on the customer experience. By providing real-time pricing information and eliminating errors in manual price updates, the electronic price tags have helped improve the entire customer journey.
The AMAG Group has achieved tangible results through the introduction of electronic price tags, including cost savings and efficiency gains. The successful introduction of digital technologies is a testament to the company's commitment to driving innovation and remaining competitive in the face of a rapidly evolving automotive industry.
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The examples listed show the positive impact digitization can have on the sales, efficiency and customer satisfaction of car dealerships. By leveraging digital technologies, car dealerships can remain competitive in today's digital age and position themselves for long-term success.
Recommendations for car dealerships that want to go digital
If you are a dealership CEO or manager looking to implement digitization strategies, there are a few key points you should consider. The following recommendations can help ensure that your digital initiatives are successful and create long-term added value for your dealership:
- Start with a phased approach: Instead of restructuring all of your dealership's operations at once, it's a good idea to start with a phased implementation. This way, you can learn about the technology, evaluate the impact, and evolve it as needed for larger-scale implementation.
- Consider the customer experience: When introducing digital technologies, it is important to consider the needs and preferences of your customers. For example, do your customers prefer to complete the buying process online, or do they value face-to-face contact? Understanding customer preferences will help you find appropriate solutions and ensure a positive customer experience.
- Choose the solutions that are right for you: Car dealerships looking to digitize their operations have a wide range of technologies available to them. Review your options carefully and select the ones that align with your business goals and budget.
- Provide comprehensive training: Your employees need to be trained on all newly introduced technologies. Make sure you allow sufficient time for training and provide ongoing support to ensure a smooth process.
- Monitor and adapt: As with any new endeavor, it is necessary to continuously monitor the effectiveness of your digital strategies and make any necessary adjustments. Digital technologies are constantly evolving, so it is critical to stay current and adapt as necessary to remain competitive in the marketplace.
Start with a phased approach: instead of restructuring all of your dealership's operations at once
By taking these recommendations to heart, your dealership can implement a successful digitization strategy and position itself for long-term success in the digital age.
Conclusion
In summary, digitization offers numerous benefits for car dealerships, including increased sales, improved efficiency and higher customer satisfaction. While there are a variety of technologies and strategies that car dealerships can employ as part of their digital transformation, electronic price tags are an effective and cost-efficient option to begin the process of digitization.
If you are a dealership owner or manager considering the implementation of electronic price tags, it is important to carefully consider your options and select the appropriate technology. Make sure you fully train your staff and allow enough time for the rollout to ensure a smooth implementation. As with any new technology, continually monitor its effectiveness and make necessary adjustments to ensure it adds value to your dealership.
As the automotive industry continues to evolve and digitization becomes more prevalent, it is imperative for dealerships to remain competitive and position themselves for success in the digital age. With careful planning and implementation, your dealership can be well on its way to reaping the benefits of digitization. By adopting digital technologies and strategies, dealerships can stay at the forefront of the industry and create long-term value for their business.
Contact us at any time so that we can support you in implementing your personal digitization strategy. You can reach us at any time by phone +49 (0)30 863 963 59-0 or by e-mail info@dicoso.de.
