Ecommerce jumped 32.4% this year due to the Covid-19 pandemic. It was projected to “only” jump 18% until the pandemic shifted consumers’ buying habits.
Ecommerce will reach 14.4% of all retail sales in 2020 or $794.5 billion in sales. Projected growth is anticipated to slow in 2021, but customers are projected to continue to drive eCommerce to 15% or more of all retail sales in 2021. One thing is clear; consumers are not going back to pre-Covid retail practices.
These stats come from a Digital Media Solutions article here and are for non-automotive, but they tell the consumer changes you face.
The article also notes that the little online bookseller called Amazon now controls almost 40% of all online retail sales. That is what getting into eCommerce early, and being responsive to consumer desires gets you.
I don’t think automotive will get rolled up to that level. Still, as a few publicly traded auto retailers push digital retailing (Asbury), I see them taking market share from laggards and even those who are half-heartedly attempting digital retailing.
Dealers that are serious about competing for the future are looking at the whole buying process, not just putting a lead widget on their website to drive more showroom visits.
As noted in the article, Best Buy and Target created a new digital retail path that helped them grow online sales by 100% over 2019 levels. The new path they implemented is simply an excellent digital to brick and mortar handoff experience with their “Curbside” pickup programs. Why didn’t customers just wait for items to be delivered? My guess is 2-fold.
- Customers want the dopamine spike they get from “shopping,” which is more intense when they pick it up.
- Customers also like to get instant gratification when they purchase something. Waiting for delivery takes away from that gratification.
This type of handoff experience is available today for dealers that want to provide their customers with a dopamine-filled, instant gratification retail experience.
I guess that both Best Buy and Target used their current digital and in-store infrastructure and made the adjustments (added software) to track and deliver purchases to their curbside pickup customers. Dealers can do the same. Adding a Retail Operating System like CreditIQ allows them to sync their current software (showroom & online) and sales processes to deliver a seamless buying experience, whether started online and finished at the showroom or started in the showroom and finished online.
The best way to look at this transition is by the numbers and successes from history. We can do this by going back to that little online bookstore and its competitors in 2010. The winner was small and is now the 800-pound gorilla in the eCommerce market. 2nd place was a late adopter to the eCommerce world, but a strong fighter. 3rd place goes to the company that started to adopt “too late” and well….
The results:
Winner:
Amazon 2019 sales $280 billion (2010 sales were $34 billion)
- $246 billion growth over 9 years ($275 billion if you count 2020 growth projection)
2nd Place:
Barnes & Noble 2019 sales $3.5 billion (2012 sales of 5.73 billion were its peak year)
- $2.2 billion decrease in 7 years
3rd Place:
Borders Books failed to go digital quickly enough and liquidated in 2011.
Note, I pulled the revenue data above from different websites, so they may not be 100% accurate, but I think the overview tells the digital adoption story accurately.
I think the automotive industry has benefited from the complicated sale process and customers’ desire to test-drive vehicles before purchasing. I hope the industry continues to market the importance of a test drive to get customers into the showroom. However, much like Best Buy and Target, it’s time to move most or all the detailed sales process online with a Retail Operating System.
Let’s leave the exciting and high dopamine delivery experience as your dealership’s lasting impression for all your future sales!
If you are interested in learning more about CreditIQ’s Retail Operating System, please reach out to us at – sales@creditiq.com.
