With declining margins implemented by manufacturers struggling to increase market share (at the cost of dealer profit), and the information age making invoice costs, interest rates, and incentives (trunk money) available to anyone with computer access, the game of selling cars has certainly changed.
Gone are the days when people had a close, familial relationship with their local car salesman much in the same way that did with their family doctor or lawyer, or their neighborhood florist. Today the car sale is primarily a numbers game. Buyers know what they want -- and what others are paying for it -- and distinguish between deals based on perceived value. While price negotiation was once a tactical but friendly exchange between two parties interested in reaching a fair deal, most transactions today seem to start off with an ultimatum. Free online price quotes take the local aspect out of the game. Shoppers are basically unlimited geographically, so for most price is the most significant consideration.
Naturally, this trend has left dealerships in somewhat of a difficult situation. Today, local dealerships are often forced to make physical improvements and engage in additional advertising and marketing tactics to attract potential buyers and maintain their market presence. They're often found promoting aspects of their stores like family ownership, superior customer service and other such less tangible advantages. When dealerships do manage to draw customers in, those consumers are much more aggressive than car buyers in days past. Four out of five shoppers conduct their initial research online and don't even set foot in the dealerships until they are well equipped with competing quotes, invoice pricing, and secret tips they may have found on one of the many Web sites like carbuyingtips.com.
A recent Nielsen/Net Ratings report published by the Center for Media Research shows that only two of the top ten online automotive destinations were brand specific. The others were all a combination of marketplace information sites (eBay Motors, Autotrader.com) and buyer education portals (cars.com, carsdirect.com, Kelley Blue Book, etc.). It seems that even dealerships employ and refer to sites like Edmunds.com to gauge consumer values and research options these days.
With all of this information available at our fingertips, it's easy to forget that purchasing a new car should also be a visceral experience and contain an emotional aspect. Sure it's great to do your homework ahead of time, but the bottom line is that you need to get out there and drive some cars. Regardless of how you perceive the car buying experience, there are dealerships out there that are willing to deal and can turn a chore into an event to anticipate. They may not all offer the prices you seek, but if you ask me, enjoying a positive car buying experience is worth a few extra bucks.
Another great site that has saved thousands for car buyers is http://www.car-buyingtips.us
Posted by: William Dearn | September 21, 2004 at 10:05 PM