Surf’s Up: Internet car shopping remains prevalent post-COVID
~October 12th, 2023
When COVID-19-related shutdowns and restrictions hit the automotive industry in 2020, dealerships were forced to transition to more of a web-oriented sales strategy.
With the pandemic now in the rearview mirror, some in the industry here say the recent advancements in online vehicle shopping have resulted in more-knowledgeable customers, which saves time and creates more competitive pricing.
“The customers are happier. The employees are happier. The deals are quicker,” says Joe Bowman, internet director at Spokane Valley-based Dishman Dodge Ram Chrysler Jeep. “It’s really opened our eyes that this is a good way to do business.”
Online car shopping is nothing new, says Dishman’s dealer principal Mark Waltermire, but customers are now able to get further along in the process than they were prior to the pandemic.
Before 2020, Dishman’s customers couldn’t do much more in the buying process than fill out and send in a credit application before having to call or go to the dealership, Waltermire says. Most traditional dealerships didn’t have the online tools available that they do now, he says.
“For the consumers, it’s less time, less gas money back and forth to the dealership, full transparency,” Waltermire says. “They have all the information—trade-in value, payments, price—before they even come into the store.”
The same is true at Wendle Motors, says Andy Keys, the Spokane-based dealership’s general sales manager.
“The statistics tell us that about 90% of our customers are researching vehicles online before they ever come in, and that’s probably been the case for about the last 10 years,” he says.
Now, however, customers are able to take additional steps beyond just researching vehicles they are interested in.
“We get a lot of people that will enter negotiations. They’ll agree to terms, payments, and have everything done basically with all that’s left to do is come and drive the car and make sure they like it,” Keys says. “It really has streamlined the process.”
Keys has noticed a post-pandemic increase in sales leads stemming from the internet, he says. Because of an inventory shortage during the COVID era, many people were driven online to find which dealerships had the vehicles they were looking for.
“I think they’ve gotten in the habit of that now, because inventory has improved but we sure still get a lot more online leads than we used to,” he says.
While customers can complete the entire process online now, Keys says the majority of Wendle customers—over 90%—still want to test drive vehicles before purchasing.
Salespeople at Wendle now spend less time helping customers select vehicles, and more time presenting vehicles, says Keys.
“There’s so much technology in the cars today, that that’s a really important step,” Keys says.
Salespeople at Dishman also typically need to go over the many features that newer vehicles have, Waltermire says.
The most common scenario, Waltermire says, is customers who gather information about a vehicle and figure out payments and trade-in value, then come in and test-drive it, and if they like it, they fill out the paperwork and purchase it at the dealership.
“Nobody just comes into a dealership blind on what vehicle they’re looking for anymore,” Waltermire says. “They already have done some research.”
With the vehicle shopping process taking place online more than it had in the past, the automotive marketplace has become more competitive, leading to price points closer to true market value, both Keys and Waltermire say.
“You’re competing with a bigger group of dealerships than you are with the traditional model,” Keys says. “It makes the marketplace much larger.”
In the past, dealerships were mostly competing with others in the area, but now customers can find vehicles they want from dealerships all over the country, Keys says.
That increase in competition and transparency has led to fewer negotiations for Dishman, Waltermire says.
“You’ve got to have your good numbers out there,” Waltermire says. “Majority of the time, (customers) already know that you’ve got the best number, you’ve got the vehicle that they want, and there is no negotiation.”
Because of the increased transparency with prices and payment plans, he says customer satisfaction has been higher with the primarily online shopping process.
The new method of vehicle shopping has benefits for dealers too, Keys says.
“From the dealership’s perspective, it allows us to schedule customers better,” he says. “It helps us avoid times where we’re backed up for people to complete their paperwork. You can control the traffic flow better.”
It also takes pressure off customers, he says.
“They don’t feel like they’re going to get talked into something, because they’re really doing their research at home,” Keys says. “It puts more logic and less emotion into it for the customer.”
Waltermire says he expects the prevalence of online car shopping to not just remain but increase as more of the younger generations get into the vehicle-buying market.
Bowman concurs and says this is the new normal for car shopping.
Both Waltermire and Keys say that those who prefer shopping for cars completely in-person are still able to do so.
“There’s still a good segment of the population that likes to search the inventory, kick the tires, and do the stuff physically,” Keys says. “So we’ll still see that.”