Auto brands shift gears on the virtual highway
BMW, Volkswagen, Hyundai, M G Motor refresh the digital playbook in the midst of a crisis
As minimal to zero physical proximity becomes the norm, auto brands are looking at ways in which to press their digital channels into service, most efficiently and with maximum impact. Specific tailored marketing pitches using first party data, smoother payment and financing processes and digital launches that attempt to simulate showroom experience are among the ways in which auto majors are keeping their brands in the game.
For example, the recent launch of Creta by Hyundai. Eager to knock down friction on the purchase pathway to the minimum, the company had been working on a click-to-buy portal. Piloted in January with a few dealerships, Hyundai commissioned it into full service in the wake of a lockdown as it sought to ensure a seamless customer purchase journey.
Not just Hyundai but other auto companies are also looking to fix the crimps on their digital highways. According to a report by Facebook and KPMG (Eliminating friction in the automobile path to purchase, 2018-19), a poor digital strategy means that more than twothirds of four wheeler addressable market does not even enter the purchase funnel. “Further, nearly four in every five fourwheeler and two in three twowheeler aware decision-makers do not complete their purchase journey after initiating it,” the report noted.
For Hyundai, fixing the payment and financing gateways for Creta was part of the launch plan but when the entire exercise was impacted by the pandemic, the task became doubly critical. “Ever since its launch in 2015, the Creta has become the benchmark SUV for the aspirational Indian buyer,” said Tarun Garg, director, sales and marketing, Hyundai Motor India. For Hyundai too, Creta sets the benchmark as its market share is up from 11per cent in 2015 to 23 per cent in 2019. Hence all stops were pulled out to ensure that nothing, not even a pandemic, could derail the launch.
A similar imperative pushed luxury car maker BMW to launch a digital facelift of its entry level SUV BMW X1 in India and Volkswagen India to go for the online launch of its TRoc. Rudratej Singh, president and CEO of BMW Group India said, “In today's situation with the corona virus scares and the sentiment being the way it is, we would like to just encourage people to use technology. We are turning adversity into an opportunity to make sure that people are safe, but also have a thrilling experience.”
By going digital, luxury car makers could significantly widen their reach several studies have shown. According to one by Google and Kantar TNS, even though all auto purchases happen offline, 90 per cent of car buyers research online before setting foot into a dealership. And once they’re at the dealership, 65 per cent of car buyers will continue to do research on their smartphones. This holds true for both mass and premium brands.
For Volkswagen and BMW, the digital thrust is likely to hold up through future launches too, given that the current pandemic is likely to increase the influence of online channels even further. Another auto company betting on a digital future is MG Motor. The company said it has completely digitised the process of bookings and delivery. Plus it has put out an assurance for all buyers. Gaurav Gupta, chief commercial officer, MG Motor India said, “In times like these, ensuring the wellbeing of people becomes paramount. Safety being our topmost priority, through the ‘Disinfect and Deliver ’ programme, our focus is to sanitise throughout the value chain.”
However even as auto companies look at ways to tip the virtual scales in their favour, experts hold out several warnings. Customers want convenience but are wary of the dangers (data privacy, fake information) that digital channels hold out. “Data privacy remains a significant concern for consumers globally, with 61 per cent of those surveyed indicating they would be less willing to buy or use a product or service if companies use their personal data,” found a recently released report, ‘Consumer trust in digital marketing’ by Group M. For India, 58 per cent of consumers said they were less willing to buy or use a product or service if companies use their personal data, the report said. Transparency and experience will emerge as key differentiators said experts and this is driving many companies to design personalised engagements and interactions with potential buyers.