The automotive retail industry is constantly evolving and it’s important for dealerships to stay up to date on the latest trends in order to stay competitive. In this blog, we will explore 10 key trends that are expected to shape the industry in the coming years.
Trend #1: Increased focus on customer experience
Providing a positive customer experience is crucial in the automotive retail industry and dealerships are constantly looking for ways to improve.
(Source: https://survey2connect.com/customer-experience/automotive-customer-experience/)
This can include offering amenities such as coffee and snacks, as well as personalized service. By focusing on the customer experience, dealerships can differentiate themselves from the competition and build customer loyalty.
Trend #2: Increasing use of technology in the sales process
Technology is playing an increasingly important role in the automotive retail industry and is changing the way cars are bought and sold.
(Source: Google/comScore, U.S., “Automotive Shopper Study,” n=3,165 consumers 18+ who purchased a vehicle in the past three months, )
Dealerships are using virtual test drives and online purchasing options to make the sales
process more convenient and efficient for customers. These technological advances are also benefiting dealerships, as they can reach a wider audience and streamline their operations.
Trend #3: Growth of the used car market
The used car market is experiencing significant growth and is expected to continue to expand in the coming years. United States Used Car Market was valued at USD 195.84 billion in 2021, and it is projected to reach USD 302.47 billion by 2027. This trend is being driven by a number of factors, including the increasing affordability of used cars and the availability of high-quality, reliable options. The growing demand for used cars is having an impact on new car sales, as more and more consumers opt for pre-owned vehicles. To capitalize on this trend, it is important for dealerships to offer a wide selection of used cars that are in excellent condition and backed by strong warranties. In addition, providing excellent service and support to used car buyers is key to building customer loyalty and driving sales.
Trend #4: Changes in the dealership model
The traditional dealership model, in which a physical storefront is used to display and sell vehicles, is undergoing significant changes. In recent years, there has been the emergence of new business models such as virtual dealerships, which operate entirely online and do not have a physical location.. In addition, some dealerships are adopting a hybrid model, incorporating both a physical storefront and an online presence. These changes in the dealership model present both challenges and opportunities for the automotive retail industry. Dealerships will need to adapt to stay competitive and meet the changing preferences of consumers.
Trend #5: The role of digital marketing and social media
Digital marketing and social media are becoming increasingly important tools for automotive dealerships looking to reach and engage with customers. Dealerships are using social media platforms to advertise new vehicle models, promote special offers, and interact with customers. In addition, many dealerships are using email marketing campaigns and targeted online advertising to reach specific demographics and drive sales. By leveraging the power of digital marketing and social media, dealerships can effectively reach and connect with customers in the modern age.
Trend #6: Rise of electric and autonomous vehicles
Electric and autonomous vehicles are becoming more common on the roads and this trend is expected to continue in the coming years. The increasing popularity of these technologies will have a significant impact on the automotive retail industry, as dealerships will need to adapt to meet the demand for these types of vehicles.
Trend #7: Changes in the financing process
Traditionally, financing a car has involved securing a loan from a bank or other financial institution. However, alternative financing options are becoming more widely available and are changing the way cars are financed. Subscription models and pay-per-use plans are just a couple of examples of the new options that are emerging. These changes will have an impact on traditional financing methods and the way dealerships do business.
Trend #8: Increased use of data and analytics
Data and analytics are playing a larger role in the automotive retail industry, as dealerships look to gather and analyze information about their customers and operations. By using data and analytics, dealerships can improve their marketing efforts, optimize their inventory, and enhance the customer experience.
Trend #9: Greater emphasis on sustainability
Sustainability is becoming an increasingly important issue in the automotive industry and this is being reflected in retail sales. Dealerships are promoting electric and hybrid vehicles, as well as implementing environmentally-friendly business practices. By focusing on sustainability, dealerships can appeal to consumers who are looking for more eco-friendly options.
Trend #10: Expansion into new markets
The automotive industry is becoming increasingly globalized and dealerships are looking to expand into new markets. This presents both challenges and opportunities, as entering a new market requires careful planning and consideration of cultural differences. However, the potential for growth in untapped markets makes this trend worth exploring for ambitious dealerships.
