How the Automotive Industry can Build Brand Resilience During COVID-19
by Axel G. Heyenga
Posted on 04-28-2020
It should come as no surprise that the automotive industry has been hard hit by the COVID-19 pandemic. With a large number of the world’s population resolutely remaining indoors, purchasing a vehicle isn’t front of mind for many people and businesses.
Added to this the face-to-face nature of buying a vehicle – plus the fact the manufacturing process includes a supply chain with, quite literally, dozens of moving parts – and you can see why automotive sales are beginning to drop in many markets.
The challenges facing automotive brands, manufacturers, and dealerships are plentiful during this time, but there also exist many opportunities to mitigate the commercial and economic impact on the industry. This will ensure brands emerge from the other side in strong shape, and perhaps spur them towards a digital transformation that has been long overdue.
Join the fight against COVID-19
Businesses have always had a responsibility to use their power for good, and now is no different. In fact, the way businesses react during COVID-19 will define the way they’re perceived in years to come.
It’s hugely encouraging, then, that many automotive brands and dealerships have been quick to lend their support to those less fortunate than themselves. Across the world, leading car manufacturers such as Jaguar Land Rover are providing emergency vehicles to health workers, while others such as SEAT are using their factories to help produce life-saving medical equipment.
During times of great adversity, the spirit of community and helping others shines through, and automotive brands and dealerships must also play their part – whether that’s through sharing resources or using their networks to ease customer concerns.
Email has long been the go-to channel for automotive brands wanting to communicate with its customers, but during the current environment, people are looking towards more personal-touch channels (such as social media) for a sense of humanity from their favourite brands.
The most active brand communities are built on an omnichannel approach. Automotive businesses need to shake-up how they can communicate with their customer during this time, and that means embracing new ways of communicating and creating digital experiences.
Is automotive finally going digital?
There’s no doubt the coronavirus outbreak will accelerate consolidation and transformation in the automotive sector. Those that can react flexibly and adopt a digital mindset during this period will emerge the other side fighting.
Encouragingly, in automotive, over half (58%) of consumers say they’re still interested in buying a new car, but are waiting until later in the year, according to new Auto Trader research. It’s critical, then, that dealers and brands keep these prospects engaged until they feel more comfortable to make a purchase.
Dealerships have historically relied on face-to-face interactions in showrooms to make sales, and are struggling to cope with an increased digital demand. However – according to the same Auto Trader report – despite the current environment, two in three people are open to the home delivery of a new car, but many dealers don’t possess the digital set-up to deliver.
During this period of re-evaluation, now is the time to look at overhauling the traditional dealership infrastructure, moving towards business models that are powered by digital experiences and online sales.
Dealerships should be exploring ways to enable their staff to communicate and make sales remotely, while manufacturers need to prepare themselves for much higher levels of collaboration and consolidation with dealerships when factories begin to re-open.
With the majority of their staff working remotely, automotive brands have plenty of time to train their people on how to use new technologies and solutions more effectively.
Most important to remember is, this isn’t just a short-term tactic to limit the damage caused by lockdown. In the long run, a centralised, digital approach will help brands better democratise their data, increase collaboration/efficiency across the board, and allow them to scale much quicker than before.
Focus on brand loyalty and customer retention
Now, more than ever, it’s important to exercise respect when communicating with customers. We need to respect the uncertainty they’re feeling around lockdown limitations. Brands certainly shouldn’t be trying to exploit this situation for commercial gain, but instead should be listening and reacting to shifting customer concerns, and needs.
To increase customer engagement, loyalty, and retention, automotive brands must focus on delivering more proactive, personalised, and timely digital experiences that align to a customer’s need or location. For example, UK-based dealer Motorpoint is offering free home delivery, while globally, many automakers are deferring payments, lowering interest rates, and offering extended terms.
The advantages of an increased focus on customer experience isn’t new in automotive however. Earlier this year, automotive brands identified customer experience as one of its key competitive differentiators over the next five years, according to Adobe’s 2020 Digital Trends Automotive in Focus report. The current environment means this focus will only accelerate over the coming months, as brands increasingly rely on a digital-first approach to creating relevant and tailored experiences.
Customers will remember how brands have reacted and conducted themselves during such a tumultuous period. All eyes are on companies to rebuild better as they come out of the crisis – and that’s just as important for automotive companies as anyone else. How brands take stock now and operate during the lockdown will speak volumes in the long term – and will make all the difference in helping the sector recover as customers prioritise the brands who got it right when making their next purchase, whether it’s during the COVID-19 pandemic or after.
As the situation with COVID-19 quickly unfolds, Adobe is committed to giving you the support and resources to navigate this challenging time – learn more.
Topics: Digital Transformation, Automotive, Brand Experience, Customer Experience, Digital Trends, retail, UK, UK Exclusive, Digital EMEA