Why is car subscription the way of the future for dealerships? How can dealers ease their dealerships into the new mobility services?
And how can dealers dip their toes into mobility services instead of diving head first into the deep end?
Those are just some of the topics covered in a new Cox Automotive Mobility Group white paper.
The document, titled, “Ready or Not, Mobility Is Transforming the Automotive Industry,” shares research and thoughts on how dealers can use various new mobility services — such as vehicle subscriptions — to their advantage. That could provide a way for expanding and diversifying recurring revenue sources at their dealership, according to the document.
Other topics in the white paper cover the changing role of the dealership and how new mobility services growth will have an impact on vehicle ownership.
The paper, available for download, incorporates consumer and dealer research from Clutch Technologies and the three-part 2018 Cox Automotive Evolution of Mobility Study series.
Other themes of the white paper include:
—Embracing the Change: If You Don’t, Someone Else Will
—What is Mobility as an Automotive Service?
—Personal Car Ownership Isn’t Going Away But …
—The Role of the Dealership: A Retrospective and a Forecast
—Personalization is Spreading to the Automotive Industry
Under that latter topic of personalization, the paper notes that dealers must re-think how they operate. But personalization provides dealers with opportunity. Cars are typically mass-produced, but dealerships can modify their sales and utilization to meet customer preferences, according to the paper. With data analytics, dealers can make vehicle and service offerings more cost-effective and efficient. That optimizes inventory, providing customers “with the right solution at the right time.”
“People are especially loyal to businesses that consistently provide exceptional value with minimum friction or stress,” the paper states. “Give customers what they want and they’ll buy more, be more loyal, and share their experiences with friends. As the future of mobility arrives, dealerships need to reorient their traditional operations to appeal to growing consumer demand for personalization, convenience, flexibility and customization.”
Cox Automotive said the report is supported by best practices from vehicle subscription and mobility services software leader Clutch Technologies.
According to Cox, the report also concurrently serves as a mobility guide for dealers, including steps dealerships can take to add subscription-based services such as single VIN subscription, vehicle on-demand, and service pickup & delivery, without disruption to their existing business operations. The report says those flexible transportation models offer more customer convenience and at the same time use fleet optimization to build loyalty and profitability for the dealer.
One idea from the paper on how dealers can ease their dealerships into the new mobility services: Telematics in loaner fleets. With telematics, providers can charge more accurately for fuel, even when the interior gas gauge hasn’t moved much. Also, by monitoring vehicle health, telematics helps fleets save on fuel use, with activities such as real-time monitoring of oil life, tire pressure, and engine hours. That helps ensure proactive fleet maintenance that can help avoid more serious and costly repairs.
The paper adds that telematics can also provide “rich consumer data” that could be helpful for long-term business planning.