Will Online Car Shopping Be the New Normal After COVID-19?

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Developing a Digital Retailing Approach that Drives Profitability

As social distancing and shelter-in-place guidance continues to impact much of the country, auto sales have taken a hard hit. Short term findings indicate that social distancing measures have prompted an estimated 65% drop in sales volume in March 2020. But there’s good news. A recent analysis by KPMG suggests that online approaches to vehicle sales have “bent the curve” and sales are beginning to stabilize.1 While a recovery period for our industry is inevitable, there’s some uncertainty around what “the new normal” of vehicle purchasing will look like. Early indications suggest that social distancing will have a major long-term impact on how dealers sell vehicles, and the F&I products attached to them.

Consumer Feedback on the Vehicle Shopping Experience

In recent years, consumers have been clear about wanting more online options throughout the car-buying process. A pre-COVID-19 Assurant study found that between 85% to 90% wanted a better car-buying experience with more online options but still wanted the flexibility of completing steps in store. Here were some of the top findings around the car-buying experience.2

Consumers dislike the long wait times, time on paperwork, and sales pressure

#1 frustration is time spent at the dealer, especially on negotiation/paperwork (47% of time)
Satisfaction is highest in first 90 minutes and declines from there; average delivery time today is 3 hours
Consumers want to reduce time at the dealer, enjoy the convenience of home shopping, increase flexibility of the buying process, and reduce sales pressure

Consumers enjoy seeing/test-driving vehicles and engaging with dealership staff, but COVID-19 has accelerated interest in home delivery

62% of consumers still want help from dealership staff and 60% want to get to know the vehicle more
Most buyers want to see/drive the vehicle, but technology is reducing barriers: 50% viewing a virtual tour as acceptable and 90% would be open to test-driving at their home/office
Prior to COVID-19 only 12% were interested in fully executing the purchase with home delivery. Today, that number has jumped to 75%.

The result is that consumers want car-buying CX their way: a mix of online/offline options

95% of consumers want a combination of offline and online options during their journey
94% want to shift the time-consuming portions online: configuring payments, reviewing documents, and reviewing contracts online
89% would be more likely to purchase from a dealership that offered online options

COVID-19 has accelerated many of these trends, including prompting a decisive increase in the importance of dealers having a strong approach to digital retailing and/or virtual transactions. A recent digital survey by KPMG suggests that, to meet the increased demand for online car shopping, 80 to 90% of U.S. car dealers will fully adopt e-commerce capabilities by the end of 2020.1

The Role of Digital Retailing Has Accelerated – and it Includes F&I.

As we begin the process of recovery and reopening businesses, the auto buying process is likely to look different moving forward. With inevitable concerns around health and social distancing top of mind, consumers may want to complete even more of the car shopping process online. And, while your car inventory may already have an online presence, what about your F&I products? Are they included in the online experience?

Given the critical role F&I products play in dealership profit margins, now is the right time to think through how these key profit-drivers integrate into your digital retailing strategy. Studies show that customers who research F&I products during the pre-buying process have higher attachment rates at the end of a sale.2

Recent Assurant research indicates that online attachment of F&I products can play a big role in dealer profitability. Here are some of the key findings:2

  • 40% of consumers are interested in adding VSCs online. This is aligned with standard industry attach rates.
  • 92% of buyers want to learn more about F&I products and review product details online in advance of making a purchase.
  • 63% say they are more likely to purchase an F&I product if they have the option of learning about it on their own time.

By being able to conduct F&I research on your own website, buyers will be more prepared to purchase both a vehicle and F&I products once they contact your dealership.

How to Get Started with Digital Retailing for F&I Products

To help you get started building a digital retail approach for your dealership that highlights your F&I product suite, our team outlined the steps below.

  1. Take the Virtual F&I Sales Process Essentials online training. This free, 2-hour webinar walks through actionable insights for presenting F&I products remotely in a way that maximizes PVR and backend yield while providing a superior customer experience. Topics include setting up video conferencing for successful transactions, conducting remote F&I interviews to guide customers, obtaining customer commitment, arranging document signing and finalizing the sale.
  2. Successfully execute virtual F&I sales with Assurant’s 9-step guide. From setting up your technology infrastructure to conducting a virtual meeting and getting the paperwork signed electronically, our latest Virtual F&I Sales guide walks you through the process step by step to make closing the deal easy.
  3. Present your F&I menu virtually with the easy-to-tailor Assurant F&I virtual presentation. To help you communicate the benefits of F&I products during a virtual meeting, we created an F&I presentation that can be customized based on your customers’ needs.
  4. Leverage the Assurant Digital Engagement Toolkit. Getting your F&I product information online is the first step. Our toolkit offers you a quick way to provide downloadable F&I product information, including easy-to-understand videos in English and Spanish that make the value of F&I products more accessible to your customers.
  5. Watch our insider tips video with Margaret Nagle, Assurant Global Automotive Vice President of Marketing, to learn more about this new online car shopping experience. And watch the rest of the insider series, featuring Assurant’s automotive experts, to get valuable tips for reaching your customers and running a thriving auto business.
  6. Schedule time to discuss your digital retailing approach with an Assurant expert. Our team invented F&I more than 50 years ago and has led the industry ever since. We’re working with dealers across the country to help them build a digital retail approach that drives PVR.


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1 KPMG, “Anticipating the green flag: Accelerating a COVID-19 exit for auto dealers.”

2 Assurant, 2019 auto survey. Survey population: 630.