Digital transformation: How can it help drive your automotive business?

When it comes to digital, what are the things that you could be doing now to make a real difference to your automotive business? We gathered together thought leaders from across automotive space and beyond, to ask what the next steps in automotive digital transformation should be...

Want to hear more? Watch the full webinar Digital Expectations and Transformation in Automotive on demand now.

Today, nearly 4.5 billion people globally are digitally connected. Trillions of dollars are being spent on digital transformation efforts across all industries. And breakthrough technologies such as Artificial Intelligence (AI), the Internet of Things (IoT) and Cloud computing have the potential to redefine what’s possible for modern-day enterprises.

And consumers are expecting all brands and businesses to offer innovative digital ways of trying and buying goods – particularly right now because of COVID.

However, the automobile industry hasn’t started to take advantage of these opportunities. So what can your business do to stay ahead of the curve and where should you get started?

We gathered thought leaders and automobile experts across the industry to explain to us where they saw the vital next steps in automotive digital transformation.

Where to get started with digital transformation for automotive?

We all know that the way that people shop for cars now has forever changed. “We want to make sure that dealerships and OEMs are equipped to evolve in this rapidly changing marketplace. Right now our customers’ ability to transact virtually and digitally is essential,” says Amie Lindaas, Senior Manager of Research and Insights at Cars.com.

The dealerships that are doing well are the ones that are offering digital and virtual platforms easy-to-use and reachable to the consumer marketplace.

What if you don’t have any sort of digital presence? Amie says you don’t necessarily have to think big straight off the bat. “It's important to understand that even if you just started with putting paperwork and financing online, you're giving customers 60% of what they’re looking for.

“Or things like home delivery or delivering cars for test drives – these are all things that score highly with consumers,” she says.

Starting with incremental changes like this make a big difference to your customer experience (CX) and they’re things that don't take a lot of new and expensive infrastructure to implement.

Which businesses are doing well and why?

David Geisinger, Managing Director at Deloitte Consulting says all businesses have one thing in common: they all want to elevate the customer experience to drive better results.

But those businesses that are in top gear are those who are innovating.

“A lot of the organizations that are thriving in automotive right now have recognized that they may not be able to do things the way they used to,” explains David. “So they're looking at new ways of doing things.”

For example, that could include things like upgrades to vehicles. “People who aren't buying new cars still want to make changes to their vehicles,” says David. “So they're upgrading. That could include a new sound system in their older Porsche, or larger rims on their Mercedes.”

The key to success right now, he says, is to:

• Move quickly
• Take risks
• Be willing to navigate uncharted courses
• Listen to your customers

The last point is crucial to your success, says David. Now is not the time to be introspective and do the same things as you’ve always done, because things are not how they’ve always been.

Listen to your customers. This isn't just about what they want from you. It's about what they expect from you.

What’s the one thing automotive businesses should be doing right now?

Running your business and trying to innovate in parallel can feel like a tall order. So what’s the one thing that you can do that will have the most impact?

Offer your customers a sustainable, meaningful, and differentiating experience, says Juliana Holterhaus, Senior XM Consultant, Digital Customer Experience at Qualtrics.

You can do this by focusing on:

1. Emotion: how did the interaction make the customer feel?
2. Effort: how easy or difficult was it for the customer to achieve their goal?
3. Success: Was the customer able to actually achieve their goal?

These areas of focus have become increasingly important in the time of COVID.

1. How to encourage positive emotions with your customers

Conveying emotion through a website or app isn’t always easy. “There are obviously challenges,” says Juliana. “But those who are able to find the right balance are that much more likely to create and maintain a meaningful relationship with their customer base.

“Brands have a real opportunity to be able to convey trust and confidence,” she says. “And empathy too. Being able to recognize and connect with the human on the other side of the data point – that goes such a long way.”

2. How to minimize effort for customers

When it comes to minimizing effort online, this is where the automotive industry is struggling to keep up with retail. “People expect it to be easy and seamless when it comes to digital, but there's also an acknowledgment of the tasks that they're looking to achieve,” says Juliana. “A focus on effort is important, but people do recognize that managing their account is going to be slightly more complicated than say, a research-and-browse journey.

“The same thing goes for a ‘configure my car’ approach. Maybe there are different bumps or pain points in that journey, and maybe you could establish behavioral targeting in terms of making a request for feedback around content effectiveness.

“Or embedded question requests within the page itself, to be able to get that real-time feedback without asking too much of the person. You want to make it feel like it's a natural, organic part of the page.”

3. How to make your customers feel they’ve succeeded

“The concept of effort is quite variable depending on the task at hand, but success is more black and white,” Juliana explains. “Either you were able to complete your task or you weren’t. Maybe it was hard, but they still got it done.”

Success, Juliana says, is about knowing your strengths as a business.

“What strengths does your brand already have that can make a genuine difference for your stakeholders? And how can you innovate on these strengths and be tuned into a human-centric approach to your digital experience?

Whenever possible ask yourself: where can you make your customers successful in their digital experience with your brand?

What are the most common mistakes for this kind of digital strategy?

“One of the most common mistakes is they try and boil the ocean,” says David Mingle, Global Automotive Industry Leader at Qualtrics. “You don't need to do that. Sure, a digital transformation may take time, it may even cost a little bit more than you expected. But the fact is if you're going to make some changes, sometimes it's better to dive right in.”

There’s also a common misconception that if it hasn't worked in the past, it won't work in the future. “But obviously the world has changed,” says David. “But even without the accelerating force of COVID, customer experience is always evolving.”

Digital transformation is a never done effort.

The other mistake people make, David says, is that they don’t put enough emphasis on organizational desire to put the customer at the center of everything. “This means ensuring that the programs that are being executed at corporate are communicated at the dealer level.

“This is because then you create a great experience online, but then you lose that when you go offline or vice versa, this can't just be about digital,” he says.

And finally, the biggest misconception of all, says David: that digital transformation requires great online tech without great human interaction, whereas actually, both these things are critical. “Online tech needs human interaction and emotion. These things are all critical to organizational success – especially in automotive.

“It’s the only way you’ll succeed.”