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vishy76 2nd October 2017 19:09

Is car shopping shifting online?
 
1 Attachment(s)
Hello Bhpians,

As some of you might be knowing, I am a tenth grader which means that I have to make one of the most important choices in my life. A career.

Everything was debated upon. From being an engineer to a journalist, until I finally told my dad that I was also looking to open a car dealership chain. My dream is to improve A.S.S in India, especially when it comes to German and European Marques such as Skoda, Volkswagen and the likes...

It's then that my dad told me "Your age won't have showrooms or even test drives maybe. Everything will happen online"

That got me thinking. At first, it seemed impossible. Even after reading something as detailed as Team BHP's official reviews, I won't even cut a cheque for the booking amount without test driving the thing.

But then, it slowly started to make sense. People used to say the exact same thing that I did in the para before, about online shopping for clothes and the likes as well. Until Amazon came along and changed everything! These giants are now profit making MNCs and that's just a testimonial to our craze for online shopping.

Begs the question, will car shopping eventually move online as well? Would I be staring at an ad two decades down the line and booking my dream car without test driving it?

Some companies have started offering online bookings now, but there is a difference. You can go to the nearest showroom and look at the car in flesh as well, something you might miss in the coming decades...


neofromcapone 2nd October 2017 19:17

This thread.
Considering we are discussing this online, I don't see why shouldn't the automotive industry moving the buying process online.
The current system is highly inefficient, but can't be replaced completely. Too many people like to touch and try, do a test drive, enjoying the buying process. Especially the first time buyer.
Maruti had to make Nexa showrooms to help their customers differentiate between their premium and mass products.

I am going to keep an eye on thread.

motorworks 2nd October 2017 19:22

I think car shopping moving online is a bit far fetched. What I see happening though is:-

1) Online sales would probably happen, for lower end cars, say under 5 lakhs, where the car is already well established. For example, why wouldn't anyone hesitate to book an Alto online? Not because it's the cheapest, but because expectations for such a car would be far too less and the customer probably knows what he or she is getting in to.

2) Spares, Servicing;This is where maximum changes will happen. Servicing and spares would completely move online, meaning pick up and drop combined with online bills and payments, spare part availability etc. A lot of Apps already exist already, but they seem more post facto. For example, I have a Skoda App which allows me to view service history etc, but not the whole circle, like spare part costs etc.

3) Customizations; With many cars now taking about customisations, like the Ignis and the Captur, I think this is one area that will move online.

Even in an evolved market like the US, where online shopping is probably been there for a long time, I think car sales have largely remained in showrooms.

Unless car dealers themselves push for online, due to increasing real estate costs and trying to set up big showrooms in prime properties, I feel offline sales would be the prime way to buy a car, at least for the next decade, if not later.

TD_GHY 2nd October 2017 19:26

re: Is car shopping shifting online?
 
I think it is quite possible. There are a lot of car models that sell without the need of any test drives, any negotiations or any need of touch and feel like the Swift, DZire, Alto. Customers see them everyday, hear nice things about them, so the need to go check them out at the showroom is just a formality for people who have already made up their mind to buy such a car.

But I also believe that both offline and online will coexist for atleast a couple of decades if not more.

mudhasir 2nd October 2017 20:01

While it cannot be completely written off, it may have to work very differently from other online businesses. First thing that comes to my mind is what about test drives? Irrespective of the value of a car, preference to do a test drive depends upon the customer. A first time buyer buying 5 lacs rupee car will definitely want to try out the vehicle before buying.

If test drive can be taken care well, the next big question is how about paper work? We are talking about ownership and registration papers that involve forms from government. If a company has to go 100% online then it will have to onboard government first. I don't see any company taking that first step except Maruti with its clout in India.

As far as I can see, it's simpler said than done

vkr15 2nd October 2017 20:34

re: Is car shopping shifting online?
 
A car in the house is the second most important purchase in the family( and, in all probability, the next most expensive ), the first being the house itself. For the average car buyer, it could involve years and years of savings. And even so, most car buyers rely on loans for purchasing a car. Hence, for the foreseeable future, online purchase of cars seems a remote possibility.
As someone has mentioned, even in the most advanced countries, this is not prevalent Whether the system would change and how long it would take to reach our shores is a point to ponder. One thing is pretty certain--India would not be the first country to start online sales of cars. I may be wrong but to the best of my knowledge , no country is following this system.
Will we be the pioneers? I wonder.

akshaymahajan 2nd October 2017 22:06

re: Is car shopping shifting online?
 
Here is a good read that I came across the other day.

http://www.bain.com/publications/art...nichannel.aspx

Turbanator 2nd October 2017 23:59

re: Is car shopping shifting online?
 
It should be a combination of both, so all offers or inventories should be available online and actual experience like the test drive and paperwork can be done at Dealership. Manufacturers will able to control retail prices & inventories in a better way. It also gives a chance to high-end manufacturers to pass best offers directly to customers as well get rid of their struck up inventories. Maybe Manufacturer can have some company-owned Experience center where one can go and feel different variants, do Test drive & even book the car, negotiate finance and dealers simply operate a workshop and do delivery related paperwork.

BMW has done this last year and now again, wish they can do similar for some of the M Cars sitting with them for 2 Years :)

http://www.team-bhp.com/forum/indian...zon-india.html

https://www.team-bhp.com/forum/india...3-90-lakh.html

V12Doc 3rd October 2017 03:18

re: Is car shopping shifting online?
 
Definitely online is going to pick up. From my recent online shopping experience I would definitely see advantage of online car buying. No more calling dealership to inquire about prices, variants and on road prices.Then the advantage of knowing in stock variants and colour all around the country so you can bargain accordingly and dealing with the appropriate salesman and bypassing arrogant dealerships. Online car sales = Better deals and faster closing of sales. I recently got a car from Bangalore dealership 2500 km away because they had better price, the colour i wanted and they were not arrogant at all. Punjab Mercedes Dealership is one Arrogant Dealership.

Nissan1180 3rd October 2017 04:51

re: Is car shopping shifting online?
 
If it happens, it would be a blessing for consumers. Usually, test drives are arranged at your home by the company. There's no need to visit the showroom. The advantage for consumers would be a cheaper price tag. The advantage for service centers would be lower overhead costs. People buying luxury cars might care about the brand of the coffee they are being served, but for someone who wants to buy a Tiago or a WagonR, a Rs. 10,000 discount would appeal more than a coffee from Cafe Coffee Day. I was surprised to see Maruti investing so much in the Nexa dealerships- maybe Nexa customers want like the premium feel and do not mind paying for it.

In other news, here's a startup that's trying to use virtual reality to help you shop used cars. It was funded by BMW iVentures, and this shows that companies are expecting this model to take off soon.

drmohitg 3rd October 2017 07:42

re: Is car shopping shifting online?
 
I think with regards to cars, there would always be a need for a physical outlet. The online world can help you connect with more people and probably streamline booking, variant selecting, tracking status during waiting or transit and service related processes. But a person will still need to physically see the car, sit and drive around in it and all those things before actually deciding to buy it. So I do not see how they can entirely shift the business online.

The day might come when everything is shifted online and once a customer puts in a request, you send a TD vehicle home. But the Test drive part will still stay.

bhavik.1991 3rd October 2017 09:08

re: Is car shopping shifting online?
 
Autonomous cars & AI are the future!

A few decades down the line. the car buying process should be something like,
  1. Joe will ask his Jarvis to book a TR (Test ride) with the 'auto'maker. Jarvis will book a TR appointment based on availability of Joe & the car.
  2. An autonomous car will arrive at your doorstep without any driver or SE. Joe (and possibly his family members) will hope in & the autonomous car will take them for a ride. Automaker would have deployed their own Jarvis inside the car which will demo the car & answer everyone's query.
  3. If Joe & his family likes the car, he can make payment online & the car will be delivered to him in somewhat step1 & step2 manner. Additionally, a non-Jarvis (human) executive would be available (onsite or remotely) at the time of delivery to deal with concerns of Joe if an
y.

Looks efficient, doesn't it?

GTO 3rd October 2017 11:09

Re: Is car shopping shifting online?
 
In terms of research, the shift to online has already taken place. Nearly all car buyers research online before making a purchase. Online has also changed the game for finding used cars.

As for the actual transaction, I don't see it moving online in the short to mid-term. Long term, no one knows & only time will tell. YouTube is merely a decade or so old - see how it's changed the video industry. We're in such a fast moving world that it's impossible to predict what's going to happen after 10 years.

Auto makers currently don't prefer to deal with customers directly; that's why they have dealers to interface with the customer, invest in real estate, hold the inventory costs, play games that they never would etc. Manufacturers know manufacturing the best, not retail selling. Other than Apple & Tesla, hardly anyone else has managed to do making + selling properly (even then, Apple has needed 3rd-party sellers).

I think if the shift starts happening, it could be an online + offline hybrid initially. Not just capturing leads as the current process basically is, but something more enhanced. Test-drives at your home / office as well as deliveries could be realistic offerings (many dealerships already do this).

Quote:

Originally Posted by vishy76 (Post 4279544)
As some of you might be knowing, I am a tenth grader which means that I have to make one of the most important choices in my life. A career.

Study hard, work hard, think smart & choose majors that keep your options a bit open. But what you'll be doing 10 years from now, you cannot know (unless you want to be a doctor or similar). Even when I was 26 years old, I had no clue that I'll be running Team-BHP or an education business (both started in 2004) or investing in property.

By the way, you might want to read this.

Quote:

It's then that my dad told me "Your age won't have showrooms or even test drives maybe. Everything will happen online"
The retail channel will exist for a long time (i.e. dealer sitting between the car maker & customer). Only the way they work will change due to technology.

Quote:

People used to say the exact same thing that I did in the para before, about online shopping for clothes and the likes as well. Until Amazon came along and changed everything! These giants are now profit making MNCs and that's just a testimonial to our craze for online shopping.
Online shopping is less than 1% of retail sales in India. Even in the USA (the country of Amazons & Googles), it's about 10% today. Online is growing, but traditional retail formats aren't going anywhere too soon.

A M 3rd October 2017 11:19

Re: Is car shopping shifting online?
 
I think it will happen eventually. It will be an efficient process. Less and smaller physical outlets would be needed and the test drives can happen at one's preferred place and preferred time. Will save a lot in terms of logistical costs but at the same time, will affect the businesses of dealers.

But complete shift to online purchases (with no showrooms around) should only happen when the cars are no more cars but an electric washing machine on wheels which have no emotional connect but only a means from Point A to Point B. But as long as the internal combustion engines are around, only a partial move to eCommerce is a good deal.

Quote:

Study hard, work hard, think smart & choose majors that keep your options a bit open. But what you'll be doing 10 years from now, you cannot know (unless you want to be a doctor or similar).
So true. But becoming a doctor may also not make your choice easier. There's a lot of work happening in the med-tech space and in another 10 years, a doctor's job might also be at risk.

abhishek46 3rd October 2017 11:22

Re: Is car shopping shifting online?
 
There are a lot of things "online" does not offer like:
1. Touch and feel of interiors
2. Sit and feel of the seats/cabin
3. Drive and feel of the Engine/NVH/Ride/Handling

In short, buying "online", robs you of a very emotional and connected feeling of choosing youy ride for the next decade/half.

If buying a car is the destination, then the process of choosing it, is the journey.


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