David Crawford (pictured), managing director, Branded3 - a St Ives Group company

'Since automotive ecommerce took off in the late 1990s, cannibalisation of sales has been an issue for brands and retailers.

Historically, dealers were the ‘first moment of truth’ for motorists, while manufacturers provided the initial stimulus to raise awareness of a vehicle.

Digital channels have now completely disrupted that very linear customer journey.

The web has presented car manufacturers with an opportunity to showcase vehicles and engage their audiences – but the same can be said for dealerships. So how are the two competing with each other, and would they have more success if they shared digital strategies and data?

Recent research from marketing solutions and print services provider St Ives Group - a survey of 1,000 people over a six-month buying cycle - reveals that 34% of people researching a car purchase visit a dealer website, compared to 26% of motorists visiting a manufacturer’s site; meanwhile 11% glean information from social media.

This only goes to show how different the buyer journey is compared to a decade or two ago.

Meanwhile, separate research by Google revealed an average of 10.4 different sources of information were read by consumers making a decision about which car to purchase.

Google has labelled this new stage in the buying process the 'zero moment of truth'; the process has revolutionised the whole marketing model, causing automotive marketers to completely rethink the way they plan their customer communications.

This has meant that customers are going into dealerships much further into the decision-making process, when they are already better informed about what they want to buy, why they want to buy it and what they expect to pay for it – regardless of whether it’s a new or used car.

This is backed up by a report published by McKinsey in 2012 that stated 50% of customers make their decision regarding which new car to buy through online channels alone and only then get in touch with a dealer.

Meanwhile, the St Ives Group research highlights that the average purchase journey now takes one to four months.

Low-cost and mainstream vehicle buyers follow similar purchase pathways, only going to a dealership when they are ready to make a purchase.

Premium buyers, however, follow a distinctly different journey, and go to the dealer still wanting validation of their choice, meaning they are unlikely to be sold a car on their first visit. It’s vitally important to understand these different routes to purchase.

From a dealer’s perspective, digital channels have disarmed the sales team by giving customers so much information to help with their purchasing decision before they even need to speak to anyone at the showroom.

Even at its most simplistic, if people can buy the same or similar car at another dealer down the road for £500 less because they’ve seen it online, that still gives them a lot more power and control than they once had.

From a manufacturer’s point of view, and in particular at the more low-cost and mainstream end of the market, potential customers do not see a reason to visit manufacturer websites at all when researching and selecting a car.

They are able to get all the information they need from generic sites such as Auto Trader and Top Gear and, although the initial trigger for purchase is often an emotional one (‘I just want a new car’), when actually doing the research it comes down to very rational requirements around cost, size, economy, optional extras and even the location of the dealership.

But the advent of digital isn’t just negative and problematic for automotive brands and dealers.

One definite advantage is that the web has extended the geographical reach of product from a sales perspective, especially towards the premium and luxury end of the market.

It’s also important to think more broadly than just pre-purchase and the see the overall opportunities of using digital channels.

Digital has given dealers the opportunity to use technology to develop and build strong customer relationships post-purchase, such as service reminders and online booking system, service history access, warranty reminders and product recalls.

Digital channels and technology offer a fantastic opportunity to improve the service delivery standards of the brand, product and product experience, regardless of whether that’s dealer or manufacturer driven – because the customer doesn’t actually care who is providing the service.

It’s vitally important that dealers and manufacturers do not compete with each other; they must work with each other.

After all, they are on the same side, talking to the same customers with the same desired end result. Everyone stands a much better chance of achieving that if they work together.

It’s all about the customer and their journey, identifying what role both parties have on that pathway and accepting that different market segments function differently, as the St Ives research has outlined.

Identifying and understanding the customer and their individual decision-making journey, then making sure manufacturer and dealer work hand in glove to deliver the best customer journey is the most effective solution.'