Online sales of new vehicles: Tesla shows how it's done

Online sales of new vehicles: Tesla shows how it's done

Car manufacturers (OEMs) are selling fewer and fewer cars through traditional sales channels. The reasons include changing customer requirements and purchasing preferences as well as the temporary closure of physical sales outlets due to the COVID-19 pandemic. This is also reflected in the global sales figures of the three largest German automobile manufacturers: In 2020, the Volkswagen Group sold around 25 percent fewer vehicles by the third quarter, Mercedes-Benz delivered 14 percent fewer vehicles and BMW delivered 11 percent fewer vehicles to customers. This shows automobile manufacturers that the digital transformation in sales must be further accelerated and that online car sales offers in particular are of great importance. The management and technology consultancy BearingPoint has examined whether and how automobile manufacturers are represented with online shops in the most important markets of China, the USA and Europe. This showed how big the differences are between the individual automobile manufacturers and their strategies for the markets examined.

Andreas Unger, Partner at BearingPoint: "Car manufacturers can no longer rely solely on the good reputation of their brand to sell their vehicles. They have to be where their customers are in order to understand their needs and preferences. Online sales are becoming increasingly important, as Tesla impressively shows. The fact that some car manufacturers do not yet serve certain markets at all is difficult to understand. Because the digital transformation of the customer journey when buying a new car is a key success factor in generating customer acceptance. OEMs that are committed to this “If you don’t adapt to the trend, you risk your market position and customer acceptance. Many of the weak points we found in the services we analyzed can be eliminated by optimizing the connection between the digital and physical elements of the purchasing processes.”

Online shops are vital for automobile manufacturers

New customer contacts via online shops are now not only optional for automobile manufacturers, but also essential for survival, emphasizes BearingPoint. But setting up an online shop to sell cars as quickly as possible also means that companies must transform themselves into a future-proof organization that adapts to changing customer requirements and purchasing behavior, the study says. More and more manufacturers are setting up online channels and are now represented in the most important markets.

A closer look reveals regional differences. For example, in China and Great Britain there are a large number of online shop offerings with a high level of service maturity. 11 of the 13 manufacturers examined in China operated an online shop at the time of the investigation. This puts China ahead of the UK (8) in the top places in terms of the number of online shops available.

In the USA - after all, one of the largest car and online sales markets in the world - the number of online shops for new cars is a disappointing four shops. With four online shops, Germany only offers an average offering, although the trend has been increasing recently. France (with two online shops) as well as Italy and Spain (only one online shop each) are at the bottom of the list here. According to BearingPoint, this is because OEMs do not see these as markets with high online sales maturity.

Tesla is leading the way

Comparing the major car manufacturers, there is only one manufacturer that operates online shops in all evaluated markets, even in Spain and Italy: Tesla. Not only is Tesla represented everywhere, the electric car manufacturer also performs best in all markets analyzed, BearingPoint emphasizes. Tesla is successful with its revolutionary sales model because the US manufacturer has understood how to meet customer expectations and be where the customers are. And that's online these days.

German manufacturers are currently still underrepresented in the top positions of the regions examined. This has several reasons. Currently, only a few manufacturers serve their customers via comprehensive online shops. Particularly noteworthy are the markets of China, Great Britain and Germany. In addition, the shop offers themselves, compared to the leading practice, have potential for optimization in various phases of the customer journey, which currently prevents them from achieving a top ranking.

According to BearingPoint, the maturity level of online shops does not correlate with the segment in which the OEM is active. The study found that both volume and premium manufacturers offer high-quality online shops. This means that volume manufacturers do not have to hide their offerings behind those of premium manufacturers. While both segments have their strengths in different areas, there are still some blank spots on the map where neither OEM has a leading online offering.

In its study, BearingPoint analyzed the online offerings of leading OEMs in the USA, China and Europe, assessed their online sales readiness, identified leading practices and derived recommendations for action. Among other things, what was assessed was how the OEMs meet customer requirements along the digital customer journey, especially the purchasing experience. Since the new car market is very diverse and customer behavior differs from market to market, the scope of the study was designed to include the world's most important car markets - China (31 percent), the USA (25 percent) and Western Europe (25 percent) of global car sales in 2019.