The Future of Automotive Retail

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The Future of Automotive Retail

You may have read our last blog piece which focused on pop-up shops and the merging of retail & brand experience. Within that article, we touched on how some pioneering automotive brands are at the forefront of this and are working to change the traditional model of purchasing a car. In this article, we look further into the issues increasingly facing automotive brands and how they will need to adopt new marketing techniques within their automotive retail strategies in their plans to succeed in 2020 and beyond.

Source: Sytner Group

Time For A New Set Of Wheels

Growing family? Current car on its last legs? Just fancy an upgrade? There are a bunch of reasons behind making the decision to purchase one of the highest value items that we’ll ever buy (second only to purchasing a house). But, overall the current process hasn’t changed in decades and automotive retail is starting to slip behind the rest of the retail sector.

We’ve probably all been through the process – we think we know what car we want to buy, we do our home research, traipse along to our local out-of-town industrial estate and begin the painful process of purchasing a new car. Met by a pushy salesperson looking to make their targets, we’re shown around the car, potentially offered a very brief test drive and then coerced into parting with large amounts of hard-earned cash or to take on one of the very cleverly thought out financial products that help manufacturers shift new cars whilst leaving us, the consumer, with nothing to show for it at the end of a predefined period.

Now, most of us wouldn’t purchase a house without taking a detailed look around it and carrying out untold volumes of research. We would even seldom purchase new clothes without spending a while in a changing room in front of the mirrors or having the option to easily return them. And we wouldn’t buy a set of golf clubs without trying them out using the in-store simulator. So, why are we expected to purchase such an important and high-value item based on a 15-minute driving experience?

Time For Change

The current car-buying model is outdated and it’s time for an update and some fresh thinking. Purchasing a car over the internet is not as practical as say, buying a new microwave but there are a multitude of ways that manufacturers could begin to adopt to take their products to the consumer and make the process more appealing. With car sales continuing to drop YOY, and the added focus on new technologies such as electric/hybrid cars, it’s time to take action.

Tesla have been the pioneers of this ‘out of the box’ retail model since their inception. Largely favouring smaller, shopping mall stores over large industrial estate dealerships has allowed them to demonstrate their product to consumers in a more engaging and convenient environment and reach those who wouldn’t otherwise have seen them. They’ll let you take a car for a test drive even if you’ve got no intention of purchasing it just so you can experience their offering.  However, in a bid to cut costs, Tesla are now looking to take another leap of faith and close their stores moving to a purely online sales model.

Source: The Telegraphy

In the UK, other manufacturers such as Mercedes-Benz and SEAT have explored the shopping mall model but is that enough? With huge competition between manufacturers, all with many similar products and offerings and the emergence of new lower-polluting alternatives, what else can be done to win the consumer over and ensure they are given as much education, information and experience when making such a large purchase.

Source: Motoring Research

Taking Car Sales Into The 21st Century

Global mega-brand Ikea recently announced their intention to capitalise on the ever-increasing number of vacant high street retail spaces by opening a number of inner-city stores. Potentially a clever move by a brand who typically have large out-of-town sites making them inaccessible to many and creating a barrier to more frequent impulse purchases.

Source: My London

Now, for most, a new car is never going to be an impulse purchase (as much as we’d like it to be) but the consumer needs to be given the opportunity to experience the brand and product in a more relaxed and accommodating environment prior to making such a large commitment. 

Some manufacturers are now offering extended test drives and whilst this is a step in the right direction, it still leaves room for further evolution of the process.

Automotive Experience

Pop-up stores are becoming the automotive retail model of choice by many brands as they allow for greater flexibility to test what does and doesn’t work without having to make lengthy financial investments into long leases. There is clearly a greater opportunity for automotive manufacturers to get on the back of this trend in greater numbers and make use of some of the larger vacant high street premises being left by the numerous on-going retail casualties or develop more innovative visibility in shopping centres and transport hubs such as airports and train stations.

However, adopting this route and pushing the boundaries even further (for the brave brands who are willing to get ahead of the curve in this natural progression and reap the rewards) will lead to heightened experiences, greater consumer interaction and ultimately, an increase in sales.

Experiences Shape Our World

At the heart of the thinking at Ambient is a belief that experiences shape our world – and this can not be more relevant now. In this changing retail landscape, the power of experience is gathering increased recognition and credibility as a serious and integrated part of the marketing and sales mix.

Ambient has a unique approach to building brand experiences. We summarise it in three words: ‘Live, Keep, Tell’. Experiences we live, create memories for us to keep which change our behaviour and provide us with stories to tell.

You can read more about this in our book: ‘Live Keep Tell – Experiences Shape Our World’ which includes at least one story of an automotive experience which shaped the world for us at Ambient!

To find out more about how Ambient can help bring your brands to life or to request a free copy of our book please email us at info@ambientww.com

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