Industries like retail electronics have adapted to the Internet smooth and effectively, allowing individual companies to sell the same goods at a significant discount. The auto industry, however, has not adapted nearly so well to the rise of the Internet. And while I doubt auto dealerships will disappear anytime soon, BMW will be attempting to sell electric vehicles through online outlets for less than they’d cost at a dealership. It’s a move that could have far-reaching consequences for the whole industry.
Rise of the Digital Dealership
It is no secret that BMW seems concerned about the sales potential of its upcoming i-brand of electric vehicles. The economy-minded i3 and supercar i8 will have a limited appeal among luxury car buyers, and BMW has no doubt seen the struggles of other automakers selling electric cars. So perhaps that is what convinced the largest luxury automaker to try and sell its electric sub-brand via the Internet.
Without the dealer markup and transportation costs (though a delivery fee is still likely to be charged) BMW could slash thousands of dollars off of the MSRP. It would also mean no more negotiating with hard-nosed salesmen who want to squeeze every dollar out of you. That alone is a reason this plan could work very well.
A New Brand of Marketing for a New Generation
The idea is to have a roaming marketing team and a few i-brand showrooms, which I think is a great idea. I’m no marketing expert, but it seems to me that the future of auto sales will be focused online. A handful of showrooms will give consumers a chance to see, feel, and drive the car of their choice, and then they can hop online and order exactly what they want. Right now BMW has just one i-brand showroom in London…but all it is has is literature and prototype cars on hand, since the i3 and i8 don’t go on sale until next year.
As I already said, dealerships won’t be disappearing anytime soon. However, if BMW’s attempts to sell high-tech vehicles online meets with success, it wouldn’t surprise me if other automakers followed suit. My generation is especially saavy when it comes to Internet shopping. Haggling with experienced salesmen is not a trait many my age possess (though i scored a pretty sweet deal on my girlfriend’s new car playing one dealership against the other).
Would you ever consider buying a car online? Or would you still rather deal with the dealerships?
Source: Detroit News