With Maharashtra and Delhi, the two leading car-buying states under lockdown, and other states following suit, the country is perhaps staring at a lockdown situation similar to last year.
As a result, carmakers are likely to realign their focus on digital initiatives to drive sales whilst ensuring health and safety of their employees and customers. With most of CY2020 shrouded under the cloud of Covid-19, which led to social distancing, a part of car buying went contactless too.
While digital retail is nothing new in the world of e-commerce, to apply the same concept to a big-ticket item like a car has been a revelation which has seen accelerated efforts in a very short span. So, when the brick-and-mortar fails, it boils down to click-and-order for India Auto Inc.
But with the high-value nature of automobile products, as well as the sheer excitement that the thought of getting a new vehicle creates in a family or to an individual, has digital automotive retail been able to prove its mettle in an evolving economy?
Autocar Professional reached out to carmakers who are innovating in this space to see if their digital initiatives have indeed struck the right chord with buyers and whether the industry is likely to continue exploring this new frontier.
Nissan Motor India
Nissan Motor Indiais betting big on digital retail, especially when it is seeing its wheel-of-fortune turn with its new Magnite compact SUV. The company believes a digital retail model needs to be simple, less intimidating and fully transparent to be able to gain customer trust.
“At the same time, the role of a dealership becomes even more critical as customers expect the same level of sophistication and transparency once they arrive at the showroom. That is where we are finding ways to make this transition between online and offline as seamless as possible,” said Rakesh Srivastava, MD, Nissan Motor India.
Along with the compact crossover, the company introduced its ‘Shop at Home’ e-retail platform in December 2020 and claims to have drawn almost 10 percent of the total bookings online.
“Globally, Nissan is taking lead in creating the future ‘phygital’ retail model, with the right mix of digital solutions and dealership interventions. This will come to life by leveraging some key technologies like machine learning, augmented reality, natural language processing (NLP) and some of the system integration technologies to help create a seamless online-to-offline journey,” added Srivastava.
The Nissan Shop at Home allows potential customers to research about the brand’s cars online, personalise them, access financial solutions, get an estimated exchange value of their existing vehicles, book the new car online using the payment gateway and also apply for loan with Nissan Finance. The dealership receives all of this information on a real-time basis and takes over the proceedings of delivering the vehicle.
MG Motor India
MG Motor India is recording increased digital transactions since March 2020. It now expects the share of digital channel to increase to 20 percent in the near-term.
The company also says that due to the current situation, a two-way assisted journey virtually between customers and dealerships is increasingly becoming the best practice. “Virtual meetings and virtual product walkthroughs are some of the next breakthroughs that we see to boost digital sales,” said Gaurav Gupta, chief commercial officer, MG Motor India.
“We believe that the digital retail model is only going to grow stronger with time. The entire purchase journey of the industry might even get re-imagined with new-age technologies including AI, Machine Learning, AR, and IoT. Digital retail will add to people’s convenience and choice. At the same time, it will make transactions more seamless and efficient with Big Data, cloud computing, and data analytics. We are working with a lot of start-ups as well as international experience management companies on these fronts. Going forth, car experience will also come under configurator, wherein tech-driven audio and video experiences (AX and VX) alongside advanced features will transform the in-car experience of customers,” he added.
MG Motor India claims that the conversion time has dropped from earlier taking 10 to 12 weeks, to now 4 to 6 weeks through the digital retail model.
For premium carmaker Audi India, there has been a spike in the number of people reaching out to it online since introduction of its digital retail initiatives in May 2020.
According to Balbir Singh Dhillon, head, Audi India, “The unique visits on our website have gone up by 44 percent from last year. Vehicle configurations on the website too have seen a 75 percent year-on-year uptick. Around 18-20 percent of Audi India’s lead generation happened through online channels — which eventually convert into purchases — and this is only growing.”
“While it is still some time away for it to reach critical mass, people are warming up to it nonetheless,” he added.
The company had introduced its Audi VR experience as a fully-functional VR application for customer consultation at Audi dealerships. Moreover, it trained its sales force to deliver a seamless VR experience to customers at their preferred location as well.
“We have been at the forefront of enabling and introducing future technologies such as AR and VR elements, and with that, we have garnered incredible traction even at a time when dealerships were closed during the initial phase of the pandemic last year,” Dhillon added.
“We are investing heavily into our digital platforms and that is helping our partners grow their business online,” Dhillon remarked.
For German brand Volkswagen, which is executing its reboot strategy in India, online sales are an integral part of this renewed charge. The company has witnessed a surge in digital activations (bookings) to 25-30 percent of its overall sales in the past year.
“We initiated our online retail sales and service for a contactless delivery experience last year. And, as part of the overall brand strategy, we are actively investing in enhancing the digital online sales and service channel for a seamless experience,” said Ashish Gupta, brand director, Volkswagen PassengerCars India.
The carmaker says it is in the process of introducing customer-focused solutions under its holistic ‘Sarvottam 2.0’ initiative. This initiative is designed to have accessible brand, people, information, network, products and services, providing customers a unique Volkswagen experience.
“Towards enabling digital retail, we have already introduced online test-drive scheduler and online bookings. Additionally, we are in the process of introducing a real-time car availability tool as well as car price configurator on our website. These features are expected to go live within the next 2-3 months,” Gupta added.