Connected Car Data: The New Tool for Dealer Growth
Connected car technologies like Advanced Driving Assistance Systems (ADAS) and in-vehicle networking offer game-changing advantages 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 to provide a better customer experience. The wealth of data opens up endless possibilities for a whole ecosystem within the automotive value chain — including automotive retailers and service centers.
Robert Forrester, CEO of Vertu, major car dealer in the UK, stated that car dealers must become technology companies. He explained in an interview with McKinsey, “Car retailers, if they haven’t become technology companies in the next ten years, won’t be in business…We need to use technology and digitalization, not just for the customer journey but also to transform our business from a process point of view: make it extremely efficient, remove errors, make the customer delivery 100 percent right. Robotics, data analytics, and artificial intelligence sound like grand words, but they’re actually generating massive business value.”
With more cars becoming smart cars, and almost all new cars expected to have some level of connectivity by 2030, the proliferation of car data available is already providing the environment for car dealerships to easily adapt toward a technologically-savvy model that will allow for a more profitable business.
Car dealerships want to:
- Bring the right inventory into stock and keep that inventory ready to sell
- Connect their buyers with the perfect vehicle to make the most profitable sales
- Build long-term relationships with their customers by delivering great customer service
Read on to find out how connected car data helps with each of these aspects of the business.
Know Where Vehicles Are on the Lot or If They’re Not
Dealers can utilize location data from connected cars for applications that visualize where every vehicle is located on the lot. This capability allows sales associates to spend much less time finding vehicles and more time listening to their customers’ needs.
With geofencing, managers can receive alerts whenever a vehicle leaves or enters the dealership. Geofencing enables real-time theft detection and also allows managers to monitor the progress of test drives. Combining this technology with vehicle unlock and ignition codes, dealerships could begin to offer low-touch test drives, which 81% of respondents to a recent Autotrader survey say they prefer.
Keep Inventory Sales-Ready at All Times
When thousands of options are available to car buyers with just a mouse click or swipe, inventory visibility and vehicle readiness are critical to making the sale. As soon as a car arrives at the dealership, integrating connected car data with inventory systems gives sales teams up-to-the-minute information about what they can sell. While it’s there, dealer personnel need to be sure that it’s always ready for a test drive. Connected car data can power applications to monitor battery levels—a significant issue for large dealer operations— as well as fuel, oil, and wiper fluid levels. Armed with this knowledge, dealers can ensure that every test drive delivers the best possible driving experience.
Sharpen Pricing Strategies
The timing of promotional offers has a big impact on dealership success and profitability. Trip data generated by connected cars provide a deeper understanding of test drives.
- Which vehicles are going for more test drives, and which ones are languishing on the lot?
- Are successful test drives longer or shorter than the unsuccessful ones?
- What types of promotions result in more test drives?
Connected cars provide dealers with a wealth of data to analyze and drive strategies based on real buyer experiences.
For used cars, connected car data offers even more possibilities: To price vehicles based not just on mileage but on detailed driving patterns and maintenance histories.
Offer Concierge Services to Seal the Deal
Connected car data is fueling an ever-growing number of concierge services that bring more convenience and enjoyment to the driving experience. Dealers are in a unique position to partner with the companies providing these services. By doing so, they can add delight to the vehicle purchasing process and open up new revenue streams.
For example, a new car purchase might come with:
- A special offer for usage-based insurance
- Discounted fueling through an app
- On-demand car washing by Dropless or Spiffy
- A specialized driver monitoring app for new teenage drivers
- And much more!
Increase Customer Lifetime Value with Proactive Service
Anticipating customer needs is the cornerstone of great customer service, and connected car data provides a multitude of opportunities for dealerships.
- 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.
Reach out to us if you’d like to learn how to get your dealership started down this new path.