Retail Anywhere - Car Buying Report - Connected Podcast

Greg Uland [00:00:03] Hi, I'm Greg Uland with Reynolds and Reynolds, and you're listening to the Connected podcast. You can find episodes on YouTube, Apple Podcasts, Spotify and if you like what you hear. Be sure to subscribe so you can get new episodes delivered straight to your inbox. Today, I'm talking with Kasi Edwards, senior vice president of marketing at Reynolds Reynolds, and we're going to talk through a new consumer report that we just put out that looks at what consumers find valuable in each piece of the buying process today. Let's get connected. Kasi, how are you?

Kasi Edwards [00:00:35] Good morning.

Greg Uland [00:00:37] Hey, you know, you were the first guest on the Connected podcast in March of 2020, and things have come quite a long way. But welcome back.

Kasi Edwards [00:00:46] Thank you so much. It's great to be back. What a what a year and a half.

Greg Uland [00:00:52] Yeah no kidding. So, Kasi, you and I, we get to talk to a lot of dealers kind of in our in our roles, and we're lucky in that way. And looking forward, there's a ton of pressure that is weighing down kind of on their business in the future, from obviously inventory issues to OEM stuff to digital retailing that there's all these things. And I think that the constant, though, that we always hear is consumer expectations are always changing. So trying to stay ahead of that and understand what consumers want and more importantly, what they find valuable is something that's that's clearly really important. So we've spent a lot of time digging into that recently, and we just released a new another new report. So we wanted to have a conversation today about what we found when we went out and kind of talked to consumers. So maybe we can start there with some high level.

Kasi Edwards [00:01:40] Sure. Sure. So, Greg, in this in this new study that we just released, that's a big kind of headline takeaways consumers continue to want and demand a blended or a hybrid experience. We can talk a little bit about that. Secondly, there's specific things that consumers are willing to pay more for both online and in-store. And lastly, online buyers are actually more patient than in-store buyers.

Greg Uland [00:02:11] All right, so let's pop the hood on that one first, because it kind of caught me a little by surprise when we were looking over everything. So let's dig into that one a little bit first.

Kasi Edwards [00:02:20] Yeah, for sure. So online buyers in this study kind of told us that they're more patient or more forgiving, maybe is a better way to say during their purchase experience as compared to in-store buyers. A majority of the online buyers expected each phase of the buying process to take somewhere between 30 and 90 minutes. Compare that to in-store buyers. Most expect that each phase of the transaction to take less than 20 minutes. So really, what that tells us is is people want to transact at least partially online, but they don't have ridiculously high expectations, mostly because they probably haven't done a lot of this before.

Greg Uland [00:03:02] Yeah, yeah, for sure, and you know, it makes sense, and then the study also goes into how satisfied consumers were with their experience, so for those that did have kind of an online buying experience. How satisfied were they? And I guess the question here matters, because if you if you just ask how satisfied are you or how satisfied were you typically if as long as you didn't screw up majorly, people are going to give you like a seven or reduced on average. But if you say, you know, based on your experience, when you go through that same process again, then they're forced to kind of compare it to, OK, what did I experience before in store and how is this experience in which one did I like better? So, you know, looking at satisfaction through that lens? Talk a little bit about what that looked like.

Kasi Edwards [00:03:47] Sure. So to that point, Greg, when we talked to them about willingness to do it again, thirty six percent said no thanks. I'll see you in store next time, which really kind of begs the question why if everybody in all consumers want to buy a car online, why would they want any in-store experience? But a lot of it would be dug into this really boil down to what they found valuable and what was a good use of their time. And when you look at which parts of the car buying process the customers are willing to pay for online. There are things that are viewed as administrative, right, so things like filling out a credit app or providing a down payment or signing paperwork, or it's things that that are uncomfortable negotiating getting to an exact payment. And then conversely, when you look at things that they're willing to pay more for in-store, you see things like vehicle walk around and test drives and talking with a finance and insurance expert.

Greg Uland [00:04:47] Yeah, so the F&I one was the one that kind of I don't know, for whatever reason, it got a little off guard. Yeah, because you don't necessarily think about the F and I office and that experience being something that you know, everybody's like, You know what? I want to do that right? But at the end of the day, people in general, we kind of at least I do kind of forget don't know what products are available to protect their their vehicle that they just purchased, right? So a lot of people need help getting financing. They don't they don't know how to do it without going through the dealership. Or, you know, even more of them really just don't know what products are or what's available. So they rely on somebody to help guide them through that through that process. There were, you know, in this survey one of the things that stood out because this one surprised me so much was, you know, three quarters of consumers openly said they didn't really understand the F&I products. Very interesting.

Kasi Edwards [00:05:39] Absolutely. So I think the big key point on this section of the of the survey and the study, Greg, is the areas that those key areas are the ones that dealerships need to double down on to provide the most value to customers, right? So the pieces of the transaction that the customer finds value in doing online help them do it online really, really well. The pieces that they find value coming into the store make that an exceptional and great experience. So that sounds kind of obvious. That's not necessarily really easy to do.

Greg Uland [00:06:14] Yeah, you're right at the top, you mentioned the blended experience, and this seems like a good jumping off point to maybe dig into that a little bit more. So I don't know, maybe go down that a little bit.

Kasi Edwards [00:06:24] Sure, sure. So I think the observation is that there's there's not really an online buyer or an in-store buyer 11 percent in this study, 11 percent of consumers said told us they purchased online. But that was their perception. A small percentage, a very small percentage only like two percent actually completed the entire purchase 100 percent online. We kind of dug in and unpack that a little bit. So the vast majority of consumers were blended or call them hybrid buyers, right? Online buyers are complaining as much of the transaction as the can, but ultimately they find themselves going through the motions for the test drive and signing paperwork in person and usually for in-store buyers. Nearly all went through a big, meaningful portion of the buying process process online before they actually came into the store and stepped foot on the lot.

Greg Uland [00:07:21] Yeah, but I mean, it's so hard to execute like a seamless process, right? So when somebody starts line and they come in store, maybe they go back on line, making that process flow smoothly from online in the stores really hard. I mean, you end up in a lot of cases with employees going through a ton of hoops and doing a bunch of manual entry and digging through notes to try to figure out what's already happened to attempt to help the customer have a good experience. And I don't know, it just it seems so convoluted to make it easy on both the customer and the employee.

Kasi Edwards [00:07:51] Yeah, it is. It is great and you end up with a lot of stressed out and frustrated employees that either just can't make the experience what the customer expects, which is again, 20 minutes and each part of the process or or something short. Or they just quit trying. And we're seeing more and more dealers each and every day struggle with this and struggle with this process. It's really hard to have the discipline to keep your sword sharp when demand is high and there are five or so people lined up to buy every car, it's a real challenge.

Greg Uland [00:08:21] Yeah, you're right. All right, Kasi. Well, hey, it's been great to catch up quickly. As always, what haven't we talked about today that we should anything else you want to you want to touch on?

Kasi Edwards [00:08:31] Sure. I just I would just offer up again. We just briefly touched on on this study. There's some pretty interesting nuggets that I think dealers can pull out of it. You can grab that full report at reyrey.com/study. And as we continue in our marketplace to learn and to listen and to have conversations with dealers about the markets that we serve as an organization, we're going to continue to release new information and insights. And you can always look at reyrey.com/retailanywhere. Again, reyrey.com/retailanywhere. So there's my commercial in my plug. So thanks for having me, Greg. It's it's always a pleasure.

Greg Uland [00:09:09] All right. Thank you, and I'm sure we'll talk soon.

Kasi Edwards [00:09:11] All right, sounds great. Thanks.

Greg Uland [00:09:19] Before we hop off, remember you can find episodes on YouTube, Apple Podcasts or Spotify and be sure to subscribe to be notified every other Wednesday when new episodes are released. Thanks for listening today and we'll see in two weeks.