An explorative Impact Analysis of Digitalization in Automotive Customer Journey and Retail Experience

Abstract

Customer Journey in the Automotive Industry remained essentially unchanged for decades. Customers, however, are getting used to memorable digital interactions when purchasing or interacting with brands such as the ones in fashion industry as a front runner in digitalization. The current business model in automotive industry works through third party dealership sales, allowing a heterogeneous customer journey throughout its markets. For this reason, an explorative analysis of digitalization is needed, moreover a benchmark with a referent in retail and digitalization would be relevant, to compare and set a clear outlook of where automotive stands, evaluate use cases and think of applications for automotive; this benchmark would be the fashion industry. This thesis aims to primarily explore and describe the current digital innovations in the customer journey and retail experiences in automotive industry, to find out which are the phygital1 experiences integrated, especially in the early stages of the customer journey. For this research an explorative approach was taken into consideration. The methodical approach for the theoretical part was integrative, mainly focused on sources from scientific journals, books and papers. For solving the primary aim and give an overview of the status and latest published innovations in both observed industries, applied research was carried out. To benchmark properly, the ten most valuable brands of automotive and fashion industry (according to Brand Finance, 2022) were analyzed under the same search key terms, for example: brand + digitalization, brand + digital retail, band + phygital experience; special relevance was given to the most recent results. The main findings showed that automotive is aiming for an omnichannel experience in the customer journey, however despite having nearly the same channels as fashion, in automotive they still work isolated or fulfilling different purposes. For this integration, a shift in the business model towards direct sales is already happening in some markets and in others, a higher integration with dealer systems. The relevance of unique experiences in retail is also gaining importance. A clear trend on pop-up shops, VR and AR integration, presence in Metaverse and overall increasing convenience for the customer is key. Most of the current digital innovations in Automotive are focused on hedonic purposes and relegating the utilitarian component, something that fashion has prioritized more. All in all, it can be observed that most of the technologies are present in both industries, but the use cases and integrations from fashion can be used to learn and apply in automotive. Further research can focus on a concrete market for use cases and integrations locally.