The announcement about Hyundai and Amazon’s partnership to sell cars through Amazon in various regions throughout the country is hitting some in the automotive industry very hard. But it shouldn’t.
Consider the fact I am old enough that I had to register for the draft only months before the Vietnam War thankfully ended. My generation and others lived at least half of our lives without the internet and without the proliferation of easy-access technology. But time waits for no one and the generations that help set the standards in automotive retailing are aging out. Take a moment and remind yourself that the year 2000 was 25 years ago. Most people born after 1995 find their smart phone as indispensable as we used to find pagers, fax machines and typewriters.
Hyundai and Amazon’s partnership simply recognizes an opportunity based on changing consumer media consumption and advancements in technology. They have established a new, logical sales channel that will resonate and flourish with a growing percentage of automotive shoppers.
Car dealers at-large may see the emergence of this online car shopping channel as a threat to their very existence. I am not so sure that will be the case. In actuality, dealers play a vital connective role between the manufacturer and consumer. And that role isn’t simply about buying a car. It’s about test drives, service, parts, accessories, and warranty work to name a few. A recent 2023 research study by Progressive Insurance noted that approximately two-thirds of buyers would still want to purchase their vehicle in a dealership. According to Cox Automotive 2023 studies, only 7% of car shoppers completed all the online steps in order to complete a purchase transaction. We should be mindful, however, that the speed of technology however is relentless, and its velocity seems to increase with each passing year. As we’ve seen and experienced, particularly over the past 25 years, it is very clear that technology will continue to change the automotive shopping experience for buyers, dealers and manufacturers. The new partnership between Hyundai and Amazon is no different.
So, what do an increasing number of consumers want from online car shopping experiences? Very likely, it’s the same results that modern technology has groomed them over decades to expect:
- Convenience
- Comparing competitive brands, options
- Cost and time savings
- Instant Gratification
The same consumer study from Progressive Insurance found that 78% of first-time online shoppers found their buying experience highly satisfying and would definitely repeat the experience in the future, if given the opportunity.
For many of us, this Hyundai and Amazon partnership signals yet another transition from societal norms that we’ve grown up with. And yet for a growing number of consumers they simply look at the arrival of this shopping option as – “what took you so long”?
