Dealership showrooms regain their shine as preferred method of car purchasing

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Research released today by NTT DATA UK&I, a trusted global innovator in business consulting and IT services, reveals that only 4% of car owners plan to arrange purchasing online, down 11% compared to the previous year. Furthermore, 83% of car owners purchased their vehicle from either a main brand or an independent dealership, indicating a significant shift in car purchasing habits as consumers return to pre-covid practices.

The survey, which aimed to discover current car purchasing trends, questioned a representative sample of 2,000 consumers based in the UK. The research found that consumers still want a human touch when purchasing a car, with half (50%) having visited a showroom concerning their latest car purchase. It also discovered that when purchasing their next car, more than half of consumers (53%) are planning to purchase cars outright from either main-brand or independent dealership. An additional 30% plan to also purchase their car from either a main brand or independent dealership, but on finance.

However, while the research clearly demonstrates a return to in-person purchasing, it also outlined the disruption the sector is facing due to the rise of mobility services. The research found that a fifth (20%) of car owners are tempted to consider selling their car, with a further 15% tempted to consider sharing their car for extra income, demonstrating the growing appetite for mobility-as-a-service (MaaS) solutions.

Dominic Rowles, Automotive Client Partner at NTT DATA UK&I, commented, “These results show a surprising reduction in pure online D2C, although the exit out of Covid may have caused earlier results to be inflated. There was a sometimes reluctant acceptance from the retailer community that Agency was going to fundamentally change business models, but many may now be considering whether they should invest in a different strategy altogether.

“It’s worth considering that the online customer journey doesn’t have to be 100% digital and the respondents may well have a different view as to what fully online means to the car makers. Several OEMs are developing retailer capability into the online journey, but still involving the retailer in the final part of the journey. It’s not quite an agency model, but it’s moving much more online. For those transitioning to this model, the biggest challenge is how to migrate and share customer data across multiple interested parties, so it’s imperative that the right partners are in place to facilitate this.

“The sharing economy results further reflect ever-changing consumer demands and disruption to the traditional car purchasing market. Dealers and retailers probably won’t welcome these results, but now have to place some bets about what kind of mobility offer they want to make. Whichever route is taken, those in the sector must ensure they’re digitally transforming to respond to changing consumer demands in order to maintain competitive advantage.”