Digitalization of the new car sales process in Chile: Best models to improve customers' experience during their journey

Abstract

Abstract Digitalization processes have been developing since decades. Having the automotive industry a highly conservative process to commercialize vehicles, especially in Chile, the approaches into digitalization of new vehicles sales processes have been limited and slow as there was no consensus on how to face digitalization. Covid-19 pandemic times forced the industry players to boost their efforts and release on a short (or immediate) term different strategies that were expected to be released on a long term. Empirical research and interviews made with leading players of Chilean market shows that improving websites with transactional platforms and virtual showrooms, implementing webchats with video call options, and having home delivered test drives helped keeping the business running during lockdowns. Removing floor planning gives a relief to dealerships so they can have a broader working capital to invest on digitalization tools and improving showrooms. This is the first step to the best business model to be implemented in Chile, the Agent Model, where traditional dealerships turn to be OEMs’ agents. They will only be the ones who deliver and give service to the cars, and no longer the ones who are selling them, as OEMs are now responsible for commercializing the cars. Agents will earn by units delivered or serviced and will differentiate from other agents by the experience that they give to the customer. Agents will be the key player on the customer journey as they will be the front desk during mostly the entire process. The strategies will also change, from multi-channel to omni-channel, where customers can get the same experience despite the channel they decide to use, even when mixing channels. A market research survey shows that only 43,09% of the people will buy a car on a fully digital process, having preferences to have some process of the customer journey on a digital way (like quotation and payment) and some others as physical processes (like negotiation and deal closure), so the best will be to offer all processes on all channels and customers will decide to go digital, physical, or both. This will give a better customer journey and improve the customers’ experience