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Click and collect has been ‘a lifeline’ to the motor trade

Covid-19 has pushed more car buyers into shopping online, but is it really the future?

Online car sales may be way forward but there is pent-up demand from customers waiting to make appointments to physically visit the showrooms. File photograph: Getty

Online car sales may be way forward but there is pent-up demand from customers waiting to make appointments to physically visit the showrooms. File photograph: Getty

 

Click, deliver, drive. That seems to be, surely, the future for car sales, doesn’t it? Not so long ago, it seemed that Irish car buyers were firmly in the category of ‘too traditional’ to accept the idea of not just browsing for a car online, but actually committing to buying it. The Covid lockdowns seem to have changed that utterly, and now the whole concept of click-and-deliver car sales has been described as a “lifeline” for the motor trade in this country.

“Customers have responded well and many were happy to purchase online and have their vehicle delivered to them directly during the restrictions,” says Brian Cooke, director general of the Society of the Irish Motor Industry, the umbrella body for dealers and importers in Ireland. “The pandemic has put a focus on online sales, as this was the only option available with non-essential retail locations physically closed, and consumers became more familiar and comfortable with the process. The complete sale can be done online but what it comes down to is what the customer is comfortable with in undertaking the sales transaction” says Cooke

Some of the major brands have embraced the concept of online sales and click and deliver, not least Audi. “Customers have responded well to our online tools in 2021,” says Richard Molloy, Audi Ireland’s head of marketing and product . “Audi Ireland, Volkswagen Financial Services and our dealer network have a host of online tools for new and used cars. Even with full retail opening, there is no doubt customers will continue to research our cars, financial products, service plans and so on online. However, we know from dealer feedback there is pent-up demand from customers waiting to make appointments to physically visit the showrooms.”

Customers have responded well and many were happy to purchase online and have their vehicle delivered to them directly

That pent-up demand seems to, possibly, belie the en masse shift to online. Unlike more disposable consumer items, cars are a fundamentally tactile thing, and sometimes you just need to see, and touch, and drive in person before you can make a final commitment. As is often pointed out, after your house, a car is usually the second-most expensive thing you will ever buy, so it’s worth taking the time to make sure you’re really happy with what you’re getting.

“There are some practical considerations that may need to be undertaken before purchase,” says Cooke . “If it’s a completely new model, for example, or has a totally new engine, or maybe a customer is making a change in the brand they’re buying. Then they may wish to test drive a vehicle if they do not have direct experience of the car. Things like the physical size of the vehicle boot, the seat space, does it fit their requirements, all that might need to be seen in person.”

Volvo has already made significant moves towards selling cars online, saying in March that in the near future, all of its fully electric models will be available only as online purchases.

Selling new cars is a business with slim margins – an 8 per cent profit is a good result for most in the trade. Some car brands might ultimately aim to get rid of their huge plate-glass palaces to display vehicular wares to help improve their bottom line. Although many have already invested a seven-figure sum in those palaces.

Volvo, along with others, was quick to come forward with reassurance for their existing retail networks. “Online selling is our future,” says David Thomas, managing director of Volvo Car Ireland . “We have been in constant contact with our retailers about these future developments as this is something we will need to do together. We will transform our business model together with our retail partners, who will play a critical role also in the future. We don’t foresee this impacting the size of our network.”

Customers still want a physical presence behind their purchase

So far in 2021, Thomas says that in Irish terms, there has been “a very positive response” with customers finding a new way of interacting with our retailers, which is convenient and safe.

“We’ve been surprised at how well and how many customers have adapted to online. There is still a core of customers who want to physically visit a retailer and engage face to face but it seems to be a shrinking group. I think it’s a continuation of a trend that we’ve seen in recent years of fewer visits to a retailer before a sale is completed with customers conducting extensive research online before focusing on a particular brand or retailer. Our research shows that customers still want a physical presence behind their purchase and the reassurance of a well established business able to provide back up to the buying and ownership experience.”

For now, bets are being hedged. The move to more and more online selling is likely inevitable, but as Molloy puts it, “purchasing an Audi is as much an emotive decision as it is a rational decision” and that is doubtless equally as true for most other car brands. That lack of total rationality will give the physical, in-person dealership another lifeline as we roll ever onwards into our new digital age.