Do you grumble about increasing digitalization in your everyday life? Do you miss the times when you still had eye contact with people because they weren't just busy with their smartphones? Do you love the feeling of holding a book in your hand instead of a cold mobile device? A little nostalgia is nice, but you can't stop the development. The Internet, which is constantly available regardless of time and place, also offers convincing advantages in terms of obtaining information, comparing offers and shopping.
The automotive industry is no exception. One in 11 car purchases is now made online. 97 percent of potential buyers search the Internet for information and their dream car, and 44 percent of those surveyed would even buy a car online [1]. A recent study by ATKearney predicts that almost one in two people will buy their car online in the future [2].
The future of the car trade is digital, not just for selected areas of the customer experience, but for the entire process chain - from information to completion.
Interview with Markus Preitsameter
Markus Preitsameter, Senior Consultant at afb, advises manufacturers, vendors, financial and service providers on the optimization and digitalization of business processes. He sees an urgent need for action in the automotive trade in particular. He was available for a brief interview on this topic.
How important is a dealership's own website?
A dealership's own website is no longer just about conveying emotions and representing the brand(s), it is much more about meeting customer needs. Today's customers want to find out about the current stock and services on offer, compare vehicles and check the affordability of their dream car in advance. Car dealers should offer positive shopping experiences and avoid negative impressions. These can arise, for example, if a customer cannot afford their dream car.
How can car dealers use their website even more as a sales tool?
Although credit and leasing products are offered via bricks-and-mortar dealerships today, they are often only offered in direct customer contact. Online processes can usefully supplement the sales channels of dealerships. Buyers select the object via a configurator or catalog or from the manufacturer's inventory or from portals, exchanges or marketplaces such as AutoScout, Check24 or Verivox.
The use of a rate calculator offers customers the opportunity to have binding leasing and financing offers calculated for a desired vehicle, taking into account individual parameters such as term and down payment and vehicle-specific offers. Optionally, the calculation can be sent immediately to the dealer. The dealer can then contact the potential customer directly and complete the sales process. Above all, such a calculator offers greater independence from financial service providers, as the dealer can store the conditions of various financial service providers. The calculation service provided ensures that the most attractive offer for the buyer is always displayed. The retailer can process the data entered directly and does not have to enter it again. This also saves the buyer time and effort, as they do not have to enter their data several times.
In addition, retailers can use a business service that harmonizes the price and affordability parameters in advance or makes a budget-based preselection. As a rule, this does not even require a full credit check by the financing company behind it. In the first step, it is sufficient for the customer to specify a desired rate, which can be supplemented with information on income and expenditure. The available income can be calculated from this information and only those vehicles are displayed that fit within the customer's budget.
These so-called sales scorings make it possible to pre-approve the financing transaction. The customer receives a "certificate" that confirms their creditworthiness even before they visit the dealership, thereby speeding up the entire sales process. This pre-approval process does not require a full scoring of the customer; the results of the automatically retrieved Schufa report are often sufficient.
Many retailers would like to process the purchase of products and financial services online. What tools can retailers use?
Online application routes specially adapted to the needs of users enable the complete digitalization of the entire process chain. These include services and functionalities for address validation, digital account queries for creditworthiness data, digital document handling, digital authentication via video identification and the use of qualified electronic signatures.
The customer's signature is a show stopper for online contract conclusion without media discontinuity. What are the options here?
The European Regulation 910/2014 on trust services (eIDAS) is an opportunity to use qualified electronic signatures easily. The European Commission is pursuing an open and technology-neutral approach and regulates that the trust services of the member states are mutually recognized and that interoperability is possible. An electronic document should thus be given the same status in the EU as an analog document.
Users no longer need to have their own secure signature creation device (SSCD). This will be operated by the trust service provider (VDA). This means that the user is only responsible for triggering the signature via secure communication channels. Previously, when issuing and signing written, paper-based contract documents, the document had to be printed out and signed by hand. Since mid-2016, the new eIDAS Regulation has also made electronic signatures possible for use cases that previously required the (paper-based) written form and a personal signature, such as loan agreements.
afb's Advanced Digital Signature Management business service is used wherever documents worthy of signature are required. In addition to the signing of contractual documents, this can also apply to all other forms of confirmation. The functionality is connected to any document-issuing system via a standardized interface. The prerequisite for using this service is processing via a qualified VDA and an operational cell phone. The use of this service eliminates the need to physically send the document, as all contractual partners can access the electronic (signed) document online.
What can the link to a dealer management system (DMS) look like?
The link between the DMS and the financing portal is usually implemented via standard interfaces. This means that the customer information submitted via the portal is also directly available in the DMS. On the one hand, this saves the salesperson from having to enter the same type of data twice and, on the other hand, it makes it easier to process financing requests. Modern integration architectures support the bidirectional exchange of information so that the salesperson can view or retrieve the financing decision directly in the DMS. Documents to be submitted, such as driving licenses, can either be digitized using a digitizer app on a smartphone, transferred securely to the financial service provider and automatically assigned to the financing file or uploaded directly using an integrated upload snippet. This gives all parties involved a comprehensive overview of the status and progress of the processing.
What is the best way for car dealers to tackle the issue of digitalization?
In order to meet the digital challenges, it is first necessary to take stock. This begins with examining internal processes and sales channels used and determining the degree of utilization of digital potential. Customer expectations have changed significantly in recent years. This is being accelerated by the transparency of the market and advancing technological developments. Targeted multi-channel management, a suitable combination of products and services and an appropriate cross-media strategy enable car dealers to better serve higher customer expectations and thus increase customer loyalty and satisfaction.
Information technologies (IT) are no longer just cross-cutting issues, but explicit value creation factors. A fundamental prerequisite for this is to make optimum use of the IT system landscape and add functionalities in order to be able to respond to increasing digitalization and changing needs. In addition to increased competitiveness and far-reaching efficiency gains, this leads in particular to a significant increase in the number of leads and online contracts.
Mr. Preitsameter, thank you for the interview
Sources
1 Roland Berger (2016). Online Sales of New Cars. URL: www.rolandberger.com/publications/publication_pdf/roland_berger_car_online_sales_20160122.pdf
2 ATKearney (2017). The digital reinvention of automotive sales. URL: www.atkearney.de/documents/856314/11513591/Automobilvertrieb+2025%2B.pdf/04476552-1d15-487b-99e8-27a269732938
