Car Choices: Online car buying vs purchase in person?
Search Driven for vehicles for sale
So far in our Car Choices journey we’ve covered whether to buy new or used (or something else we invented called “nused”), whether to buy or lease, what fuel might suit and important tips about insuring a vehicle.
That’s all stuff that helps you narrow down your final decision. But getting to crunch time and actually making the purchase, there’ll be a point at which you want to do some hard research on the precise specification of vehicle that’s right (or appeals the most, perhaps).
That’s when a choice comes between doing it in person – visiting a dealership, talking through the product in depth with a brand specialist/salesperson – or staying put and doing it all online.
It wasn’t a choice to be made a few decades ago, with a mandatory visit to the local dealer to pick up a glossy brochure, receive the sales pitch and outline from a salesperson and possibly a test drive. Over the past two internet-era decades, it’s now normal that buyers and increasingly car-educated with the majority of potential vehicle buyers doing substantial online research.
For used cars, that might be as simple as refining search listings (like those on DRIVEN.co.nz) for the best fit, using the filters of price, type and petrol, but new cars consumers can dig a lot deeper.
- Part 1: Buy new, used... or 'nused'?
- Part 2: Should you buy or lease?
- Part 3: Petrol or diesel?
- Part 4: Tips for insuring your vehicle
All new-vehicle brands have a substantial online presence. Most mainstream ones have incredibly specific research and buying tools; in some cases, right through to the purchase, without ever leaving your office chair.
Bricks and mortar are still very important to the automotive industry; visiting a dealership at some stage is still considered a key part of a vehicle purchase. But the rise in online research has been dramatic in the last decade and the watershed of Covid-19 this year is acknowledged as catalyst for even more intense internet automotive shopping.
Even last year in pre-Covid times, Toyota New Zealand estimated that 90 per cent of customers setting foot in a dealership have already researched everything online.
So car brands know that buyers are better informed than they ever have been and virtually (in both definitions) know exactly what they want before visiting a dealer, and often just need confirmation or affirmation through a test drive.
Click & collect
The internet is accepted as playing a key role in car buying among the industry. But the business model can differ: some new-vehicle brands are comfortable with the consumer doing everything online, while others would prefer it to be a starting point – towards contact with a dealership as soon as possible.
You can pretty much tell which brands are at which end of that spectrum when you start looking at individual models. Some offer “configurators” that allow you to build a very specific car and will provide you with precise pricing and availability information.
Others are a bit (or a lot) less transparent, providing key information but leaving a serious buyer wanting more – the idea being that once interest is piqued, the consumer will get in touch with a dealership to get a better picture of the car they really want.
Online shopping is a great fit for the emerging “agency” model of new-vehicle business, where the distributor owns the cars and the dealerships act as a conduit between brand and buyer.
This was pioneered by Honda’s Price Promise way back in 2000. But Toyota NZ – the country’s biggest brand by miles - really shook up the industry when it adopted an agency model called Drive Happy in April, 2018. It can work for premium brands as well: Mercedes-Benz is making the move next year.
Visit the Toyota NZ website for example, and you’ll be able to specify a new car exactly as you want, get precise “no haggle” pricing and even see whether the exact car you want is in stock anywhere in NZ for (nearly) immediate delivery. You can also take the plunge and actually purchase it.
Some buyers still favour face-to-face contact; there are good reasons for seeking out a physical dealership containing other actual human beings as soon as possible in the buying process.
If you’re a "car person" and comfortable with lists and specification sheets, then online research is great, but many buyers aren’t immersed in the automotive world and having a product expert speak in plain English about what car features mean and what they can do is hugely beneficial.
There’s also the obvious ability to see, touch and experience a car for real. If you want to test drive you’ll have to visit a dealership or have it delivered person-to-person – although not all new-vehicle buyers want or need to test-drive these days.
If you’re a haggler and (more importantly these days) dealing with a brand that is prepared to haggle, then of course we’re talking an in-person scenario that a dealer might offer - either through a straight discount or value-added accessories.
A traditional dealer that has a suitable car in stock and on the premises is also much more likely to go the extra mile to get a buyer to sign on the dotted line right there and then. And that’s a whole different topic for another time.