As the auto industry shows signs of improvement and the U.S. economy continues to recover, Affinitiv uncovered some new threats to vehicle sales. Despite the positive economic trends of lower unemployment and higher disposable income, manufacturers and dealers need to be prepared to adapt their strategy if the sales recovery stalls. Affinitiv has been tracking the reasons customers decide not to purchase after they visit a dealer and identified rising concerns related to staffing and inventory.
Through Affinitiv’s XRM solution, we survey more than 20,000 auto consumers every year who visit a dealer showroom but choose not to purchase a car. We asked the showroom visitors why they didn’t purchase a vehicle and then classified their responses into a few categories. While a person’s financial situation and the vehicle price are the most common reasons not to purchase a vehicle, an increasing percentage of consumers chose not to buy due to inventory-related reasons, e.g. the specific model they wanted was out of stock. Non-buyers were also more likely to cite concerns with the salesperson as a reason to keep shopping in early 2021 compared to Q4 2020.
Approximately half of the consumers who did not purchase due to inventory reported that the dealer did not have the exact style they wanted, e.g. wrong color or size of vehicle. For consumers who identified the salesperson as the primary concern, the most common issue was a lack of follow-up related to a specific question a consumer needed to answer before they would purchase the vehicle. Lower staffing levels due to COVID is likely a key contributor to the lack of follow-up by dealer associates.
Manufacturers and dealers have the opportunity to overcome these new threats by better utilizing smart technologies. For example, Affinitiv’s technology incorporates proven workflows for sales associates to follow when interacting with customers. To ensure customers always receive a response, our technology also incorporates AI-driven chat and emails to respond to requests from leads. Overcoming inventory issues is a far greater challenge for dealers as they are at the end of the supply chain and it can take months to get the exact vehicle a customer wants. A key opportunity for dealers is utilizing intelligent marketing programs to promote the vehicles in inventory a customer is more likely to buy. Driving demand for existing inventory is critical to converting leads into buyers and lessening the likelihood of frustrating customers with the wrong inventory.
Interested in learning more? Read our latest industry trends guide to keep a pulse on the automotive market.
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Sales | January 25, 2021