We live in a hyper-connected age, this digital domain has radically altered both our social interactions and our consumer behavior . Online shopping has revolutionized retail, and is changing perceptions on how cars should be bought and sold. Consulting firm Capgemini completed a comprehensive study of what young people are looking for in a car-buying experience. They surveyed over 10,000 respondents from the US and across the globe. While the US is still the dominate automotive marketplace, emerging market buyers are providing some valuable insight on the future of car sales.

The role of social media-

Much like Yelp and Amazon, user generated reviews are having an impact on how buyers select their product. Many car buyers are publishing their experiences on social media outlets and "More than 50% of car shoppers in every market said that positive comments on social media would make them more likely to buy a specific brand." This means that OEMs and dealerships need to be more mindful of their customer service interactions. We have already discussed how automakers don't get social media, but I find it odd that Toyota, for example, only has 280k Twitter followers and is only following 20k people. Given the millions of car-buyers in the US combined with the millions of Twitter users, this seems like a missed opportunity.

When Capgemini spoke with Indonesian car buyers they found-

"98% respondents use social media for vehicle research and 99% expect OEMs and dealers to be active online. When asking a manufacturer or dealer a question online, 28% expect an answer immediately."


More want to purchase online-

There aren't too many items that can't be purchased via the web anymore. While there are a few isolated incidents (see gimmicks) of ordering a car online and having it delivered, the reality of a transaction like that still a long ways away. Even still, 44% of survey participants would like to purchase a vehicle online. What is especially interesting is the contrast between American and Chinese car buyers, only 34% of US participants desired an online purchase while 61% of Chinese buyers would choose that route. I can understand the hesitancy on the part of American buyers as a vehicle is something you want to experience before making a purchase. Though I suspect that if online purchasing does catch on in the US, we will see the "showrooming" trend start to impact dealerships.


Dealerships won't go away, but they need to adapt-

The report also states that 55% of car-buyers say the dealerships still the primary source of product information. It amazes me how many dealers still don't understand the impact of the internet on potential customers. Many people said that they foresee dealerships moving the way of "informational kiosks" rather than high-pressure sales environments. Here in the U.S. this type of change has been met with resistance especially when you look at the situation Tesla is in. However, it is only a matter of time before more car-buyers demand a purchase experience that more in line with the times.

"Generation Connected consumers want highly personalized products and services. They expect information that's relevant, accurate, and timely, delivered when and how they choose."


It will be interesting to see how these consumer expectations will play out in the marketplace. I predict we will see a much more rapid change in emerging markets that do not have the history and baggage when it comes to dealerships like we do in the US. The study is quite fascinating and hits on more issues than I highlighted in this post. I encourage you to have a read and drop a line in the comments.

(H/T to Franzouse. Image credit Carmoza.com)


@AutomatchTom is a professional car buying consultant, lover of all things automotive and a bit wagon obsessed. You can find more ramblings and plenty of carporn here.