Will They Buy Vehicles Online?

An early promise of the Internet was the hope for a seamless online sale in which dealers could market vehicles on their own website; display inventory; agree on price; get an electronic signature and close the deal.

When a group of dealers and I created FordDirect.com in 2000 we conceptualized the idea of such an online transaction.

FordDirect designed the technology, hired the staff and marketed the concept to dealers and consumers.

But consumers at that time didn't accept it. We discovered many of them wanted to use the Internet to research, shop, compare and price cars, but lacked confidence to buy the vehicles online.

Has the market changed? You bet. Let's look at the elements needed for an average dealer to provide a seamless online sales environment. (I use the word average because unless an idea, service or technology works for the masses, it is often considered just a fringe opportunity and not embraced by the majority of dealers.)

Technology

A new vehicle is sold on eBay every 60 seconds. Remarkable. So is the simplicity of how eBay brings the seller and the buyer together.

I won't oversimplify the technology that goes into making eBay a marketing giant, but the technology wins because it is so simple.

Essentially, qualified bidders can register online and start bidding in just a few minutes. The listing platform is straightforward and before you place a bid you get to see the starting bid; the “buy it now” price if the sellers lists one; when the auction began; when it ends and what the terms are for either pick up or delivery. It is simple, in plain English and holds no surprises.

Trust

We all know a good reputation is an essential element to success in the automotive sales arena. However, we often find ourselves selling against disreputable competitors who will gladly take advantage of uninformed consumers.

This is actually harder to do online because of the access to information. Let's revisit the eBay environment.

The great equalizer is the seller's feedback score. This real-time customer satisfaction index allows you to read what buyers think of the seller. An average numerical score lets consumers see at a glance the seller's reputation.

Dealers should consider a similar platform on their own website. Who better to assist you with the sale of your next vehicle than your own happy customers?

Of course, if you don't treat the customer right, your score won't be much to brag about and can hurt you. But most customers recognize there are always a few chinks in the armor and it is OK to consider the dealer if overall they do well.

Some dealers use links to the Better Business Bureau and even the website DealerRater.com so they can introduce customers to an independent service that ranks them. My preference is the dealer's own onsite satisfaction rating, because it is more dynamic.

Disclosure

When you look at most dealers' online vehicle listings, you would get the sense that every vehicle for sale is a must-have, in excellent condition and mechanically sound. But most vehicles have flaws, and many successful online dealers say a key to their success is that they disclose the flaws. It makes the customer appreciate the honesty. Check out the listings on DoneDirect.com to see how a full disclosure can build trust.

Warranty/Extended Service Plans

Dealers have a tremendous opportunity here to build confidence in their prospects and it should be front and center in the listing environment. In the descriptions, mention what kind of warranty or service plan is included. Provide a link for more details with all the legal information.

Bottom line: If we make it easy, trustworthy and transparent, we will find many more prospects willing to take the big step of actually buying cars online.

David Kain is president of Kain Automotive Inc. He can be reached at [email protected] and 859-533-2626.