First of all, IT solutions prepared through the coronavirus pandemic must be able to function in the current reality and be ready for a possible renewal of the epidemic. The latest trends in the area of ​​digitization on the automotive market support companies in adapting to the coming reality. All sales, also in the car industry, are moving online.

Three pandemic bumps

If you compare the automotive industry to a car – then on the last, bumpy section of the route – it is battering on three sides.

First of all, a pandemic has disturbed the transport industry. Traffic has minimized. Almost all vehicles that are part of car fleets have stopped running.

The second dent on the car industry body is the resignation of individual customers. People who planned to buy a car encountered an obstacle in the form of closed showrooms. As this business is still based on the customer’s physical presence at the point of sale, this has prevented the transaction from completing.

Finally, deep crack on the future of the automotive industry has left economic uncertainty. Alternative scenarios of the “new normality”, customer confusion and the need to take care of basic life needs make selling a car even more difficult. Its sale takes a distant place on the list of necessary products.

Success is more than minimizing losses

In the current situation, what we will observe and what must happen is moving more elements of the sales process to the Internet. This is the territory where the industry can lose the most. The transition to online is easiest in sales and marketing, but these are not the only adaptable areas. The others include the supply of a car or some maintenance services. Scenarios from China say companies that can boast of minimizing sales declines, in a difficult time of the greatest epidemic intensity focused on preparing and activating mobile channels and intensified online marketing activities. It is also the simplest solution – in times when you can’t leave the house, it is necessary to find other ways to reach customers – for example through websites, marketing campaigns, or better use of CRM databases. Building a list of hot leads allowed for a strong start in the early stages of loosening the restrictions, when sales in the salon finally became possible.

Companies that are an example of successes from the time of the plague speak about the fact that marketing activities conducted on the Internet have translated into it. Their sales fell, but not drastically. Considering that in Europe and Italy many automotive brands are struggling with a sales drop of over 80%, the sales plan of some Chinese dealer group companies, maintained through online activities during a pandemic of around 70%, can announce a major achievement. In this situation – based on the experience of countries where the epidemic developed earlier – we should focus on moving the entire sales process to the internet, including financing.

We must be clear: the solutions that are now emerging are not a contingency plan. Previous times will not come back. Companies need to do their homework and prepare for a renewal of the epidemic.

New reality

We must say goodbye to human willingness and openness, our need and enthusiasm for direct contacts. This reality has disappeared for a long time, most likely for years. Even when the pandemic ends, human habits and fears will remain. At present, interpersonal contact is perceived as risky and confirming people’s beliefs and will remain with them after the removal of official bans. The solutions forced by the coronavirus, which we are currently modeling and implementing, will become part of the new reality.

How long will it take? There are too many unknowns in the equation to talk about specific dates: how fast will the pandemic get out? Will we deal with its possible recurrences or mutations? Will there be other outbreaks soon? Due to the lack of response, we must be ready for the most demanding scenarios. Not only people but also the business must adapt to habits developed in society.

For the automotive industry, the greatest benefits will come from moving as many processes as possible to the Internet. Currently, most brands focus on the opportunity to get acquainted with detailed information on individual car models via the network. Other stages of the sales process, such as customer contact or car presentation, do not have such good coverage through online channels. And this must change.

When buying a car, direct contact with the product cannot be eliminated. The test drive is an important element of the sales process. But you can also make some changes in this case. Test drives don’t have to be in the showroom! A car configured according to the customer’s requirements may arrive at the agreed address instead of forcing the potential buyer to visit the salon. There is no contraindication to such a request created and managed online.

The current situation is also likely to lead to new forms of buying cars.

Long-term rental – a trend for new times?

The degree of commitment determines the ease of selling online. Thus, a long-term rental may be a greater alternative to buying a car in a new reality. There are already subscription models that remove users from the obligation to own the product. In this model, by paying a certain amount per month, the subscriber can use many vehicles, changing his car from time to time. This commitment is more expensive than the total sales of the car, but it is also much more flexible – the driver does not have to worry about the number of kilometers driven, servicing the car, insurance package, or finally a complicated mechanism for terminating the contract.

In the case of subscription options, the increase in the importance of online sales combines with the met need for greater flexibility in the offer prepared for online channels. In such difficult times as those we are currently facing, services that do not impose on the buyer too large and long-term obligations, sell on the network more often and easier, becoming a threat to the existing model of the entire industry. Resigning from buying for rent is not the only change after all. At the same time, the role of the dealer, national organization, service is transforming. But, as I mentioned earlier, it is a more expensive service, so if a company is ready to change its operating model, it may perceive this option as a chance for profit.

New business models will put great pressure on processes in the area of ​​distribution and sales. Extensive business digitization will need to meet the expectations of consumers transferring their purchases online. And as you know, everything that is online and that requires changes in business processes relates to IT solutions.

The companies involved in the creation of IT tools, the automotive industry will need competences on business digitization, combined with a deep understanding of how this branch of the economy has worked and what has changed in it today. Only at the intersection of these two planes, we will create solutions whose implementation will meet the requirements of the new reality and become the current driving force of the automotive industry.


The author of the article is Szymon Włochowicz, COO Hicron.
This article originally appeared on Finanse+Controlling