How digital is changing the automotive customer experience
In retail, consumers have come to expect a swift and seamless experience online from beginning to end (and beyond the point of purchase). This is what’s known as ‘the Amazon effect’.
Car manufacturers (sometimes called original equipment manufacturers or OEMs) and dealerships have struggled to adapt to the complex demands of digitally-savvy consumers. The experience of visiting a car dealership does appear somewhat alien compared to the ‘see it, buy it’ nature of other types of retail.
Of course, digitisation of the purchase journey is not the only thing that has disrupted the automotive industry. Environmental concern, the move towards mobility, new finance products, and the technology in the cars themselves have also changed the way consumers perceive and purchase cars.
According to the Society of Motor Manufacturers and Traders, UK car sales saw the biggest decline in 2018 since the financial crisis 10 years prior. Germany’s Center for Automotive Research has also forecast global car sales to fall to 79.5 million in 2019, down from 83.7 million last year.
In order to succeed in a challenging market, automotive brands now have no choice but to adapt to changing consumer expectations. This briefing will cover how automotive brands are innovating the customer experience (CX) through digital technology, and the trends that look set to impact the industry in future.
Transition to online selling
Today, more and more consumers are beginning to expect the digitisation of car-buying services. However, due to the complex nature of the sales model, there can be vast differences in the digital transformation priorities of manufacturers, dealers, and third-parties, resulting in a lack of alignment (and implementation of digital services across the board).
According to Deloitte, “whereas manufacturers are investing to create omnichannel customer experiences, dealers are more focused on tactical solutions that integrate disparate data systems to ease information flow across the dealership.”
However, both OEMs and dealers are selling online. And features that streamline the purchasing process online – such as transparent pricing (which show add-ons from the start), e-signing, and financing options – also help to elevate CX at all touchpoints.
Hyundai’s ‘Click to Buy’ website was launched in 2016 and allows shoppers to buy or lease a new Hyundai. The platform includes functionality to provide part-exchange valuations, configure a new car, apply for finance, pay a deposit, see local dealer offers, and then pick up from a dealer or have the car delivered if paying online.
PSA Group – the manufacturer of Citroën and Peugeot vehicles – also introduced the ability for customers to buy cars online in 2017, swiftly followed by the option for credit checks, financing, and the trading in of older models.
Others have followed suit, with some even going online-only (if only briefly). Earlier in 2019, Tesla, the pioneer of a direct-to-consumer model, announced that it would be moving all of its sales online, removing the option to buy cars in showrooms entirely.
While it has since gone back on its decision to shut all showrooms – raising prices in order to keep its branch model open (yet still selling via digital-ordering only) — it does point to a wider shift in how brands and consumers now view the digital experience. Namely that digital retail within automotive is a concept that people are becoming increasingly comfortable with. Indeed, Tesla has been allowing customers to reserve cars online for a number of years, and launched a second-hand marketplace in 2015.

Omnichannel commerce
In the world of dealerships, companies like Rockar are aiming to make online-buying as user-friendly as possible, whilst defending the omnichannel model.
The Rockar platform is used to sell cars both online and at its small format stores in shopping centres. Rockar is behind the concept for Ford, Jaguar Land Rover, Hyundai UK and Mitsubishi Motor UK. Consumers can visit stores where product experts are not working on commission basis, and shoppers are assisted in buying from the online Rockar platform (either at home or in-store).
Automotive Management Online reported in March 2019 that Rockar claims to have generated 1.6 million store visits, 12,500 test drives and 1.7 million digital journeys during the past five years. Crucially, Rockar is not willing to employ a digital retail experience at the expense of physical car dealerships.
In a survey highlighted in EY’s ‘Automotive Retail 2030’ report, 27% of new car buyers consider dealership and salespeople as crucial criteria followed by price and brand. Meanwhile, 58% of respondents said they will choose a traditional dealership over other channels to buy a car even in 2025.
Unsurprisingly though, not all customers are willing or able to travel to out-of-town locations to visit car dealerships. This is why many automotive brands such as Rockar have embraced new and modern retail formats in recent years, often creating a presence in town centres.
Dealers of luxury vehicles have opened stores alongside other luxury brands like Hermes and Versace, and more affordable automotive brands are aligning themselves with retail brands with a similar target demographic. Ford and Rockar partnered with Next in 2018 to open its first ‘high street’ retail space in Manchester’s Arndale Centre. By displaying vehicles alongside Next’s clothing and homeware, the idea is that customers are offered a relaxed and pressure-free environment to browse and potentially invest.
The one-to-one sales element of a dealership is also included, however, as Ford ‘hosts’ are there to guide customers and take them through various interactive elements such as displays that select and showcase the various specifications of a vehicle.
These retail spaces – which are less-sales orientated than dealerships – allow brands to raise awareness and to give customers a brand experience in a laid-back and low-pressure environment.
And if the shopper wants to research or buy online in their home, they can set their budget, before going on to completely configure their vehicle (and financing options). Help is also on hand too, with the platform integrating live chat to talk customers through the entire process if need be. Rockar says that – while many consumers begin their journey in a showroom – 60% of customers complete their car purchase at home via its online platform.
Aside from OEMs and dealerships, there are third-party companies attempting to disrupt traditional automotive sales, by offering new ecommerce capabilities. Joydrive is one example – a US digital marketplace that sells both new and old vehicles online. By partnering with a network of select dealers, it is able to bypass the dealership experience for consumers, merely offering them a digital-only sales process.
Carvana has a similar online sales model for used cars. It offers users the chance to shop from over 15,000 vehicles online, and either schedule delivery or pickup at the retailer.
With companies like Carvana aiming to disrupt the wider industry, manufacturers are taking heed, and as a result, are investing in more informative websites to capture consumers in the research phase. As Gartner states, vehicle information pages can “improve the connective tissue between vehicle information and purchase”, with brands like Porsche creating content pages that effectively communicate a car’s various features (as opposed to its aesthetics only).
Elsewhere, OEMs such as Tesla are delivering top-notch ecommerce experiences. This, combined with impressive design and copywriting that steers clear of cliches (instead focusing on functional benefits), highlights why customers are now comfortable enough to buy online.
In an industry that has typically offered a frustrating and lacklustre online experience, the likes of Tesla and Rockar have set the new standard.

Digital content and its role in buyer consideration
Research confirms that digital now plays a fundamental role in the car buying journey. One particular study by Google, which analysed the three-month period leading up to the purchase of a vehicle by an individual, documented 900 digital interactions whereby the customer intentionally sought out information related to an auto lease or purchase. 71% of these digital interactions took place on mobile.
This highlights how vital online content is for automotive brands looking to capture customers during the research phase. Importantly, however, this does not mean ‘catch-all’ content. As Google says, brands that meet potential car buyers across the key auto shopping moments are more likely to succeed, delivering information relating to specific questions about the product, its features, pricing, and logistics.
Honda is one brand that has created this type of online content – its ‘test view drives’ video series gives customers a better idea of what its cars are like to drive. Each video is shot from the perspective of the driver, making the viewer feel like they are in the driving seat of a Honda car. A split-screen also gives the option to continue driving or find out more information about the vehicle’s specific features. The immersive nature of the content, combined with key product information, is an effective engagement tool.
A study by Innovid found that consumers spend an average of 60% of their auto-buying time researching vehicles online across a variety of platforms, and that more than 40% of consumers who watched a video about a car or truck then visited a dealership afterwards.
Of course, it is not just car manufacturers themselves that are involved in the customer research phase. Finance is another important element, with consumers typically searching for help and advice related to topics like loans and insurance.
In order to capture and engage with this target consumer, online marketplace AutoTrader launched an online finance calculator in 2018, designed to help consumers work out their budget based on individual lifestyle. To promote the calculator, AutoTrader ran a campaign called #KnowYourNumbers, enlisting TV personality Rachel Riley.
Providing consumers with valuable help and advice, AutoTrader was also able to bring awareness to its product offering in an authentic and original way. This example shows the importance of providing real value for consumers within marketing campaigns, and how much this can enhance the customer experience (especially in comparison to shallow or flashy ads, which add little or nothing to CX).

AR & VR technology – one to watch?
One of the most-hyped technology trends in recent years has been virtual reality, which enables automotive brands to bring products to life. The technology acts as a bridge between the brochure and the showroom, allowing users to get a feel for the car before committing to an actual test drive.
Some brands, such as Audi, have been experimenting with VR since the start of the technology’s emergence. Audi now has over 1,000 VR activations in dealerships across the globe. Other brands including Lexus and Cadillac have also invested in virtual reality showrooms, with the latter involving a 3D vehicle walk-around of the brand’s vehicles as well as soon-to-be-available models such as the 2019 XT4.
Away from showrooms, automotive brands are also taking virtual reality on the road to various events and dealer expos. Chevrolet debuted its ‘Virtual Dynamics Lab 4-D Experience’ at the 2018 Chicago Auto Show, giving visitors the chance to experience the Chevrolet Camaro as it drives through various terrains.
BMW has created the BMW M Drive Tour – a now annual event that allows current and prospective BMW customers to ‘drive’ the brand’s M vehicles around some of Europe’s iconic race tracks (via VR). Similarly, Mercedes-Benz is touring the UK in 2019 with a mixed-reality experience. It involves three different experiences including being able to sit in a motion-controlled VR chair.
Whether in a car showroom or a fan event, VR enables automotive brands to showcase vehicles in a more exciting way. Augmented reality is a subtler tool in comparison, but one that is just as powerful in the context of the customer experience (and the sales process).
One recent example of AR within automotive comes from Toyota, which is now using an augmented reality tool in showrooms across the UK. Called the ‘Toyota Hybrid AR’, the iPad app works by overlaying graphics of the inner workings of the car onto physical vehicles. This helps customers to gain a better understanding of how the hybrid technology within Honda vehicles works.
While Toyota’s example creates a more immersive physical experience, other brands are using AR to bring showrooms into the homes of customers. BMW’s iVisualiser app does just this, allowing users to interact with virtual vehicles that are projected in front of the user and their smartphone. Users can also configure vehicles in real time, changing wheels and the car’s exterior and interior design. Porsche has a similar offering in the form of its Porsche ´Mission E Augmented Reality’ app.
The idea is that – while unlikely that decision-making will be based on the AR experience alone – the technology hooks customers into the buying process and gives them a better idea of what they want (before taking the next step).
Elsewhere, Audi has integrated AR into advertising to further engage customers. It has created a special AR app to recognise related Audi Quattro TV commercials, which then triggers AR experiences, such as cars bursting out of the TV and seemingly into the user’s home.
While this example is less aligned to the purchase journey (perhaps created for car fans rather than customers who are necessarily in the market for a new vehicle), it still creates a way for consumers to meaningfully engage with the brand, as well as a positive link between Audi and creative innovation.

The mobility movement
According to research by Accenture, by 2030, revenues from manufacturing and selling vehicles will be only marginally higher than they are today. In contrast, it predicts revenues from mobility services will soar to almost €1.2tn, with profits set to reach as much as €220bn.
To clarify, mobility as a service refers to the shift away from personally-owned modes of transportation towards mobility solutions such as ride-sharing, subscription or rental services.
The rise in its popularity can be put down to a number of reasons, including but not limited to population growth, the subsequent environmental impact, as well as the cost of ownership – particularly for urban consumers. Research by PwC states that by 2030, more than one in three kilometres driven could involve sharing concepts.
So, how can automotive brands remain relevant in this context? We have already seen brands within the automotive industry recognise the desire to shift away from ownership, as a number have created and rolled out alternative mobility services.
Porsche is one high-profile example; the brand launched its ‘Porsche Passport’ service back in late 2017, allowing customers to sign up to a monthly subscription service. Essentially, customers are required to pay a fixed amount each month in return for the on-demand use of up to 22 different cars. The idea is that customers can enjoy greater flexibility, with the option to switch between different cars based on specific need or desire.
Volvo is another brand to get on board, launching its ‘M’ vertical to provide on-demand access to cars and services through an app. The service is also positioned as an alternative to taxis and public transport, theoretically moving consumers away from the likes of Uber and Lyft.
Unsurprisingly, it’s not just existing automotive brands that are looking to capitalise on the mobility movement; new start-ups are also muscling in on the evolving automotive needs of consumers.
Fair is one example – a new app that lets customers rent used cars for a monthly fee. A key element of Fair is that there is no limit to how long a customer can keep a car, meaning the service is ideal for those who might not be in a position to purchase a vehicle, perhaps due to poor credit or other circumstances such as uncertain living circumstances.
The fact that customers can access the service via an app makes the consumer experience seamless, and especially appealing to younger consumers who are used to making transactions on mobile.
Due to the growth of mobility services, and brands’ investment in providing new solutions and services, some companies are also incorporating mobility into their brand identity.
Toyota is one prominent example, launching its ‘Start Your Impossible’ campaign in 2017 with the aim of positioning itself as a mobility company rather than an automotive brand. Toyota has expanded its product development into other areas including mobility solutions for people with disabilities.
Connected cars
A key part of mobility is not simply how people are changing their transportation habits, but how the experience of transportation itself is changing. Today, it is more innovative, entertaining, and technology-driven than ever before.
Indeed, the internet of things (IoT) is having a big impact on automotive. In a 2019 survey by KPMG, 59% of automotive executives ranked connectivity and digitalisation as the most important automotive key trend up to 2030. What’s more, the global connected car market is projected to reach $156.1 billion by 2023, according to P&S Intelligence.
This prediction is perhaps unsurprising given that most automotive brands are involved in introducing or improving the connected car experience.
In 2018, Ford announced the launch of the FordPass Connect system, an upgrade to its previous FordPass app. The upgrade means that users can now connect remotely to their vehicle through an app on their smartphone, enabling them to lock or unlock it, locate and start their vehicle, as well as monitor diagnostics in real time.
Mercedes-Benz’s ‘Me’ offers a similar service, as well as the ability to create a personalised profile based on favourite seat position, lighting, and radio station. Voice control also means drivers can ensure hands-free optimisation.
Elsewhere, Volvo introduced its semi-autonomous driving feature in 2018, Pilot Assist II, which automatically controls acceleration, braking, and steering in traffic flow.
These examples of connectivity certainly enhance the customer experience while driving, however, the data that is produced from these connected features also allows manufacturers to provide a better customer experience from a broader standpoint (and act as a catalyst for improvements and further product innovation).
Maintenance is another area that can benefit from connectivity, with the technology allowing vehicles to predict and pre-empt issues. Through real-time data, manufacturers have the ability to analyse and act on potential problems such as tyre replacements or engine failure, as well as to point drivers in the direction of repair services that can help fix them.
Ultimately, the connected car has the potential to revolutionise everything from parking to entertainment, and could create new advertising models by linking to local services.
What will future CX look like?
The automotive industry has made strides in digitisation, and this has certainly had a huge impact on the customer experience.
From technology-driven showrooms to online configuration – brands are now delivering experiences on any device and via multiple channels.
In future, it is likely that the shift towards mobility services will continue. However, this also needs to be thought about in relation to lifetime value, and how brands can ensure customers are kept motivated and engaged in the long-term.
It’s up to automotive brands to ensure that they are engaging customers on a human level – and forging relationships based on real value rather than technology for technology’s sake.