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4 Best Dealership Practices to

Navigate an Uncertain Market

By Amy Hughes, Sr Director of Dealer Intelligence, Experian

The automotive industry is no stranger level, but to understand the implications than vehicle make, model, and odometer
to change, but COVID-19 cast us into a of sentiment in local markets. reading, since these metrics can’t provide
situation we’ve yet to experience. With the full context of a vehicle’s value.
stay-at-home orders and tight business For example, Experian research found that
restrictions over the first few months, as of May 21, 2020, 29 percent of consumers Vehicle history reports can answer key
the market saw an immediate impact. in urban areas were considering purchasing consumer questions, such as the number of
But now, as those orders and restrictions a vehicle in the next few months, compared previous owners, the number of incidents,
begin to loosen, many are preparing to to only 10 percent in rural areas. Of open recalls, the presence of title brands, etc.
resume business activity. However, the consumers in urban areas looking to Including vehicle history in online listings
rules and processes you’ve implemented purchase a vehicle, 33 percent are looking makes this information easily accessible
pre-pandemic likely need to be adjusted. to purchase something less expensive for the consumer researching the vehicle.
COVID-19 has created a new market than originally planned, and 22 percent Ultimately, including vehicle history
environment—one that will require dealers are considering leasing. Insights such as reports in online listings creates a level of
to adapt. these can help you nuance your marketing transparency that consumers appreciate.
messages to ensure you’re leading with While an online experience will never truly
The same can be said for consumers. empathy and showing customers a replicate an in-person experience, ensuring
Lives have been upended in numerous willingness to help by presenting them streamlined information is available online
ways, such as a sudden loss or reduction options that best fit their needs. will help dealers connect with customers on
of income. And, the impact will continue their preferred medium.
to be felt for months to come. As a result, 2. While adjusting business strategies,
consumers’ appetite and sentiment around focus on other areas that can grow 4. Understand the implication of
certain topics, including buying a car, have increased digital transactions
shifted and you need to adapt to these Depending on their situation, some
changes. The situation will remain very consumers may be hesitant to re-enter With the increase in digital transactions
fluid in the months ahead, and while the the car-buying market. And that’s okay, in the automotive industry, there is a
long-term impact of the pandemic remains everyone’s circumstance is different. Many corresponding potential increase in fraud
unknown, here are a few best practices of these consumers will still need their attacks. To best mitigate these risks and
you can implement to navigate the new current vehicles serviced; some may even protect customers, you need to move
environment. have open recalls. Canvass the vehicles on beyond sole reliance on basic identifiers
the road within your market to identify like name, date of birth and social security
1. Use local market trends to inform which may need service in the near future. number—many of these basic identifiers
strategies The more you understand about vehicles in have been compromised over the years.
your local markets—current customers and Instead, new technologies allow dealers and
The pandemic has impacted everyone beyond—the better positioned you will be lenders alike to employ a multi-layer fraud
differently, which means that people’s to create revenue opportunity within the strategy that more accurately identifies
priorities have shifted, and dealer service drive. consumers. This could include techniques
strategies also need to shift. While such as device intelligence, biometrics, and
buying a car may have been on someone’s 3. Use vehicle history reports to bring document verification.
radar prior to the start of the pandemic, context to online listings
it may not be top of mind anymore. As COVID-19 has created a new market
a result, simply reengaging your pre- While you may be looking for ways to trim environment that is truly unprecedented.
pandemic marketing plans likely isn’t costs, there are some areas, like vehicle The automotive industry is resilient and
the most effective strategy. Instead, use history reports, that are more important will remain so as long as it recognizes the
consumer sentiment data to understand than ever. Given the significant financial need to adapt. By understanding consumer
how consumers are feeling, and leverage investment a vehicle represents, we know sentiment and responding to consumer
these insights to inform new marketing consumers seek to make an informed needs, dealers will build relationships
strategies. Since sentiment varies purchase decision – especially now. That’s with new and existing customers that will
across generations and geographies, it’s why when listing used vehicles online, position them for success today and in the
important to look not only at a national it’s vital to provide more information post-pandemic world. n

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