Connected Car Data: The New Tool for Dealer Growth
Connected car technologies such as Advanced Driving Assistance Systems (ADAS) and in-vehicle networking provide game-changing benefits to drivers, from safety to driver comfort and convenience.
The data generated by these systems can also be used to better understand how consumers buy and use cars, helping companies provide a better customer experience. The wealth of data opens up endless possibilities for an entire ecosystem within the automotive value chain - including auto retailers and service centers.
Robert Forster, CEO of Vertu, one of the largest car dealers in the UK, stated that car dealers should become technology companies. He explained in an interview with McKinsey, "Auto retailers, if they're not going to be tech companies in the next 10 years, they're not going to be in business... We need to use technology and digitization, not only for the customer journey but also to transform our business from Process viewpoint: Make it highly efficient, eliminate bugs, and make customer delivery 100% right. Robotics, data analytics, and AI sound like great words, but they actually generate huge business value.”
With more cars becoming smart cars, and nearly all new cars expected to have some level of connectivity by 2030, the proliferation of available car data is already providing the environment for car dealers to easily adapt a technologically savvy model that will allow for a more profitable business.
Car dealerships want:
Bring the correct stock into stock and keep that stock ready to sell
Connect their buyers with the perfect vehicle for more profitable sales
Build long term relationships with their clients by providing great customer service
Read on to find out how connected car data helps with each of these aspects of the business.
Find out where the vehicles are or if they are not
Merchants can use location data from connected cars for apps that visualize where each vehicle is in the area. This capability allows salespeople to spend significantly less time finding vehicles and more time listening to their customers' needs.
With geofencing, managers can receive alerts when a vehicle leaves or enters the dealership. Geofencing enables real-time theft detection and also allows managers to monitor the progress of test drives. By combining this technology with vehicle unlock and ignition codes, dealerships can begin offering low-touch test drives, which 81% of respondents to a recent Autotrader survey said they preferred.
Keep inventory sales ready at all times
When thousands of options are available to car buyers with just a click of a mouse or a scroll, seeing the inventory and the vehicle's readiness are crucial to making the sale. Once a vehicle arrives at the dealership, integrating connected vehicle data with inventory systems gives sales teams the most up-to-date information on what they can sell. While he's there, the dealer's staff needs to make sure he's always ready for a test drive. Connected vehicle data can power apps to monitor battery levels—an important issue for large dealership operations—as well as fuel, oil, and wiper fluid levels. With this knowledge, dealerships can ensure that each test drive delivers the best possible driving experience.
Aggressive pricing strategies
The timing of promotions has a significant impact on the success and profitability of the sale. Trip data generated by connected cars provides a deeper understanding of experiential driving.
For example:
Which vehicles will be subject to more test drives, and which ones suffer the most?
Is a successful driving test longer or shorter than a failed one?
What kinds of upgrades lead to more driving experiences?
Connected cars provide merchants with a wealth of data to analyze and drive strategies based on real buyer experiences.
For used cars, Connected Vehicle Data offers even more possibilities: to price vehicles based not just on mileage but on detailed driving patterns and maintenance history.
Provide concierge services to complete the transaction
Connected car data feeds a growing number of concierge services that make driving more convenient and enjoyable. Merchants are in a unique position to partner with companies that provide these services. By doing so, they can add fun to the car buying process and open up new sources of income.
For example, the purchase of a new car may come with:
Special insurance offer based on usage
Discounted fuel through the app
On-demand car wash by Dropless or Spiffy
A specialized driver monitoring app for new teen drivers
And much more!
Used car dealerships may offer free roadside assistance for a year or remote diagnostics with a service that can identify wear and tear before it becomes a problem.
Increase customer lifetime value through proactive service
Anticipating customer needs is the cornerstone of great customers service, and connected car data provides a multitude of opportunities for dealerships.
For example:
Dealers could remind customers that it's time for a 30,000-mile service based on the car's actual mileage instead of an educated guess.
They could send alerts to their drivers when tire pressure, batteries, or fluid levels are below thresholds
They could create personalized extended warranty packages based on actual driving patterns
They could offer predictive maintenance capabilities based on multiple operating parameters
According to Cox Automotive, 85% of car buyers state that their experience with the service department has influenced their likelihood of purchasing another vehicle. All of these offerings build a trusted relationship with the car buyer, so they look to their dealer as a trusted advisor for service and for finding them their next perfect vehicle.
Grab the Keys for Your Dealership
Forward-thinking car dealers are looking to connected car data to help them manage their inventory more efficiently, maximize per-vehicle profitability, and build new relationships with their customers.