Toby Russell of online car marketplace Shift says the company realizes that auto sales have been hit hard by the COVID-19 crisis.

“I think that the COVID environment is going to really cause an acceleration of the transition to online shopping,” said Russell, who is co-chief executive officer of Shift, in an interview with Auto Remarketing.

But Shift also realizes that many dealerships don’t yet have what the company’s communications manager Hannah Golden describes as “fully digitalized transaction capability.”

“There’s been a lot of pressure for them to get there,” Golden said.

She added that the company is looking at how the COVID-19 pandemic has fundamentally changed consumer behavior. Although the industry has seen a hit on sales, Shift has not slowed down, and the company has instead unveiled several new initiatives to help dealers get through the crisis.

Helping challenged dealer groups

The company on Thursday said it would offer its proprietary software to a limited number of dealership groups that might have experienced a decline in sales as a result of COVID-19. Shift wants to work with dealership groups operating multiple stores that they have shut down or that have experienced significant impact from social distancing orders.

Shift says some dealerships are able to list their inventory online. But few, if any, can facilitate a fully digital transaction, the company said. Even fewer can offer test drives to customers during the current environment when stores are closed or customers are not willing to go to them.

The company has worked for several years to develop systems enabling no-contact, fully online sales of used cars, with and without a test drive. Believing that test drives remain crucial to the customer's purchase, the company has created a method of delivering test drives to the customer’s location.

Shift also uses online transactions and offline transactions using a custom-built mobile point of sale application on an iPad. All transactions come with e-contracting technology, digital DMV title transfer, and F&I products.

The first Pulsar customer

In related industry news, Russell said Shift would be the first customer and car company to use conversion automation tool, Pulsar AI.

With the tool, car dealerships can automate lead engagement by autonomously contacting, engaging, qualifying and following up with any lead “via natural, automated two-way conversations.” Pulsar says it integrates with the dealership’s existing CRM, inventory management and DMS systems to answer every specific question that customers ask and follow up until they are engaged.

“Is this car light blue or dark blue?” “Does this car have a sunroof?” Those are examples of questions the Pulsar system can answer.

Russell mentioned a statistic showing that more than 90% of prospective buyers start their vehicle shopping experience online.

“In essence, retail auto shopping is dead,” Russell said.

He added that customers want to interact with a car seller not only online, but also over email or through interactive digital media to be able to ask questions about a vehicle.

“Consumers are shifting all the shopping behavior online and are rapidly moving their purchasing and interaction behavior online,” Russell said.

He continued, “And so we see Pulsar and these other elements as critical steps, and with the current environment, the need for safety and non-in-person interaction, I think it’s just going to massively accelerate that transformation and that transition.”

Russell said answering prospective customers’ questions that come over the web is a challenge for dealers, especially if a customer is shopping online during non-business hours.

“It’s going to be really hard to staff somebody who’s there to answer all the questions about the cars or even knows about all the cars,” Russell said.

He said Pulsar has used Shift data to create answers to questions based on the interactions Shift has had with customers, and Pulsar has worked to enable computers to respond to customers’ questions.

That, Russell said, “is pretty transformational in the way you think about helping someone shop for and select the vehicle that’s right for them in an online setting.”

Additional Shift programs

Shift is adopting additional programs such as no-contact test drives. For that program, a Shift concierge comes to the customer’s home, and before handing the keys to the customer for a test drive, the concierge will wipe down frequently touched surfaces such as the interior and exterior of the car and keys.

Shift will also waive the direct shipping fee for direct online sales.

The Essential Workers Program/Community Pricing Initiative is another Shift program. The company will provide special discounts on vehicles for essential workers such as medical professionals, utilities operators and grocery store staff members who need personal transportation. The Community Pricing Initiative temporarily lowers prices on some inventory to help members of “the larger community” afford reliable transportation if the crisis has affected them.

Regarding the announcement that Shift will offer its proprietary software to a limited number of dealership groups facing COVID-19 challenges, Russell said the future will see two types of car dealers: The first are those that can address customers’ online needs, not just at the shopping stage, but “all the way through the funnel.”

The second type of dealer is “the folks who don’t make it,” Russell said.

“It's that classic history of American retail,” Russell said.

He continued, “And so what we’re saying at this point is we have shifted implementing a lot of these technologies and have built a platform that makes that easy. And we’re open to, and we'll be exploring with, other major dealers that want to do that, the use of this platform.”