As the automotive industry evolves, so too does the consumer-dealership dynamic. The latest Dealership Experience Survey conducted by our carsales team provides a clear view of current consumer behaviours, preferences, and expectations when it comes to buying cars from dealerships. The findings below offer dealers valuable insights into areas of strength and opportunities for improvement.
Over half of the survey respondents (55%) indicated a preference for purchasing vehicles through dealers, with this figure slightly lower (47%) among used car buyers. This preference highlights the continuing importance of dealerships in the car-buying process. While the reliability, warranty offerings, and established reputations of dealers keep them ahead of private sellers, the margin is not overwhelming.
This slim lead suggests that dealers cannot afford complacency, especially given that a significant portion of buyers still opt for private sales. Customer service issues, alongside concerns about price negotiations, are significant factors driving buyers towards private sales. The anxiety associated with negotiating prices at dealerships, combined with perceptions of high costs, are areas that dealers must be cognisant of to maintain their competitive edge. Doubling down on the focus of building a reputation for transparency, fairness, and excellent service could be the key to reversing this trend.
Dealership visits remain a crucial part of the car-buying journey, with nearly half of the buyers (49%) visiting three or more dealerships. The primary draws are the opportunity to test drive vehicles and the chance to view a wide range of options in one place. These visits often lead to purchases, given the tangible benefits of warranties and the trust associated with established dealership brands.
However, the dealership experience is not without its pain points. A significant number of respondents (48%) expressed anxiety over negotiating with dealers, with nearly one in three citing distrust in the information provided by dealerships. This distrust is often rooted in past experiences where customer service fell short, with 20% of respondents indicating that poor service, inattentive staff, or pushy sales tactics led to dissatisfaction, underlining the importance of trust and transparency in dealer-customer interactions.
Customer incentives, such as discounts, trade-in bonuses, and loyalty programs, remain highly appealing, particularly for new car buyers, with 75% expressing interest. These incentives are a critical differentiator for dealerships, especially when competing against private sellers who might not offer similar benefits. The challenge for dealers is to ensure these incentives are both attractive and clearly communicated, as they can significantly influence purchasing decisions.
While dealerships continue to hold a significant place in the automotive buying journey, there is no room for complacency. The path to sustained success lies in addressing the underlying concerns that may be driving consumers to explore alternative purchasing options. Simply put, by focusing on the foudations of transparency, trust, and customer service, dealers can reinforce their position as the preferred choice for car buyers.
SURVEY METHODOLOGY
The Dealership Experience Survey is conducted annually on the carsales website, with 2,254 respondents participating between 30th June and 20th July 2023. The survey aimed to reflect the habits, preferences, and experiences of Australian consumers regarding dealerships and dealers. The data was weighted by age to ensure to accurately represent the Australian population.
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