Driving Into the Future With Toyota
The Automotive Giant Changes the Way We Buy New Cars
- Financial Services
- Digital Platforms
Get to Know Toyota
Toyota has consistently remained within the top automotive companies in the world. In terms of both manufacturing and revenue, Toyota is a leader within the automotive industry. They’re the top manufacturer and sales leader in electric hybrid vehicles, and they can be seen as pioneers in the industry in more ways than just that.
Not content to revolutionise the cars that people buy, Toyota wanted to transform the way in which people buy them. Keen to innovate fast, they turned to Valtech to make their plans a reality.
Bringing Car Buying to the Digital World
For most of history, people have purchased new cars in the same fashion: load the kids up on the weekend, and then spend hours haggling over the best price while the kids run around and complain that they’re ready to go home. It’s what we all expect when we go into the process, but online shopping has forever changed the way people make certain purchases.
A lot of attention has been focused on how people buy cars, but the truth is the tried and true process for consumers also leads to one prescribed way for manufacturers to sell cars: with dealerships as intermediaries. This is to say that there was never a direct-to-consumer sales model within the automotive industry. Car dealerships are franchises, they buy cars from the manufacturer and then sell them to consumers.
However, with the advent of ecommerce, it’s become clear that consumers across the globe are interested in a different buying experience. Online brands have maximized the direct to consumer business model. Meanwhile, the automotive industry has remained relatively unmoved by these seismic changes—buying a car remains, very much, an offline activity.
Toyota had questions about whether there was a direct to consumer route for auto sales, whether that was something consumers even wanted, and how to accomplish this while maintaining the important and valued relationship with dealerships.
It’s Not Like Buying a Custom T-Shirt
Custom t-shirt companies are a dime a dozen these days. The act of jumping online, designing a shirt yourself, and then having that shirt delivered to you is so popular that even brands like Levi’s have jumped on the bandwagon. But buying a car isn’t the same as buying a €25 shirt.
The concern from automotive companies was that there would be no interest from consumers in buying a car directly online. Due to the need for credit and identity checks, and the overall complication and regulation around lending and financing, buying a new car online won’t ever be akin to buying a t-shirt. However, after conducting some research into the topic, Valtech found that customers don’t expect those two experiences to be the same. Instead, buying a car online is closer to opening a new bank account, and it is something that consumers are interested in doing on their own.
The point of this new service offering is not to remove the dealership altogether, but to change its role, from being sales-led to focussed on the long-term customer relationship. So now, in the countries where this service is live, a customer looking to buy a new car has the ability to do so entirely online, either through their computer or on mobile. This includes going through the car configurator to make sure their car includes all of the different features they want.
From there, the customer will be able to adjust things like the total down-payment and monthly charges, to find a deal that suits their needs. Once they’re happy with the plan, they can complete all identity and credit checks needed to finance their new car, digitally sign the appropriate paperwork, and arrange for delivery to their nearest dealership – potentially the first time they will visit one.
The process of financing a new car tends to take hours. In the locations where this new Toyota Financial Services solution has been rolled out, the process takes as little as a few minutes. This new service has been rolled out in a number of countries in Europe and will expand worldwide in the years to come. The first online orders came in a few hours after going live. Special online finance campaigns are supported as well to further enhance the journey.
This offering from Toyota is an end-to-end service in which all users have the ability to perform every step without needing to go into a dealership until the very end to collect their car. And driveway delivery is a functionality that should be on the horizon. Toyota intends to continue rolling out this service to other countries around the globe in the months to come. And where automotive giants like Toyota go, others are sure to follow. It’s safe to say that after this, the way we buy and sell cars may never be the same again.
A Special Note on COVID-19
The COVID-19 pandemic has further proven that online capabilities are critical to success in most industries, automotive included. While technology is a great enabler, it must be complemented by both business and marketing activation to truly succeed.
Martin Müßener, Vice President Sales & Marketing, TOYOTA Financial Services Europe & Africa Region