The goal is to transition from brand-building to establishing a deep, loyal customer relationship, writes David Cumberbatch
Automotive OEMs have long planned to emulate the seamless customer purchasing experience seen in consumer tech retail, like Apple’s experience, yet their efforts have largely fallen short. A single non-negotiable price may appear customer-centric, but the car buying journey is more complex. It is crucial to rethink the optimal customer journey across digital and physical spaces, considering elements like part exchange, financing, insurance, electric vehicle (EV) products, accessories, vehicle servicing, waranty and maintenance. The goal is to transition from brand-building to establishing a deep, loyal customer relationship too. Regardless of whether OEM’s use a traditional franchise or an agency model, many fail to grasp the complexities of the customer journey.
Consumer attitudes to car ownership have evolved dramatically, yet OEMs’ responses remain inadequate. The car buying experience—from online research to physical test drives and financing—has become increasingly intricate. Therefore, shifts in go-to-market (GtM) strategies have stalled, with several manufacturers postponing a transition to an agency operating model.
While some OEMs have embraced the agency model, they face challenges, unlike new entrants who can adopt this model without legacy constraints. The market is changing, and simplifying the car buying process to deliver a higher quality experience is crucial. OEMs must inspire confidence in new vehicles and enhance the overall customer experience to reinforce brand value.
The shift from traditional dealership to agency model appears advantageous for OEMs and consumers, offering direct customer access and eliminating complex negotiations. However, OEMs lack the experience in managing direct customer relationships, a task that goes beyond high level brand strategy. Dealership networks excel in demand creation and relationship management through servicing and repairs, areas where OEMs often fall short. Moreover, some OEMs are uncovering that they lack insight about the financial intricacies faced by dealerships. The transition from a traditional franchise model to an agency or direct model is complex, and without the right expertise, OEMs struggle to create a customer-centric GtM model.
Customer experience
Amid unprecedented industry change, focusing on customer interactions is essential. But, delivering a consistent customer experience doesn’t require a ‘one size fits all’ GtM approach. Each brand has unique attributes and appeals to different customers with varying expectations. OEMs need to understand these evolving customer buying behaviours—digital and physical—and identify points of friction in the purchasing process.
Investing in understanding where customers seek information, and addressing pain points, can lead to a better prospect experience. As well as this, utilising data to personalise and tailor the journey is crucial. OEMs must also consider the existing systems landscape and its ability to support the desired experience, regardless of GtM approach. Consumer demand for choice, evident in general retail, must be factored in.
Creating an optimal customer experience involves mapping the entire journey end-to-end, acknowledging its non-linear, omni-channel nature, and involving multiple stakeholders along the way. At each touchpoint of the buying journey, it is important to clearly define responsibilities for delivery, which will vary across different GtM models. Understanding different customer personas and preferences for how they want to interact with a brand is also key. For instance, the journey of an EV sceptic differs from an early adopter. Tailoring experiences to resonate with specific personas can highlight gaps, pain points and opportunities for improvement for OEMS.
In a market where vehicles are becoming increasingly similar, the customer experience stands out as a key differentiator
However, it is also essential to acknowledge that the customer experience extends beyond just the initial sale. The outdated ‘sell and forget’ approach—pushing customers down the sales funnel to purchase and then largely ignoring them until the sales push starts again—is not good enough, and must evolve. Instead, OEMs should focus on customer lifetime value, ensuring ongoing engagement and satisfaction post purchase. Mapping the entire customer journey and identifying personas enables OEMs to design the best end-to-end experience, whether through a traditional franchise, agency or direct model.
The car buying experience should be positive, even uplifting. After all, it is typically an individual’s second biggest lifetime purchase. Yet today, far too many customers feel confused and neglected. Although the objective is to provide an optimal customer experience, a deep understanding of the intricacies of purchasing and owning a car is essential to achieve this.
In a market where vehicles are becoming increasingly similar, the customer experience stands out as a key differentiator. OEMs must ensure a smooth, effortless entry into the market, seizing this chance to strengthen their brand experience. This involves carefully aligning customer expectations with the design and implementation of the most effective GtM strategy.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.
David Cumberbatch is Associate Partner – Customer Experience at MHP Consulting UK
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