Getting auto ecommerce right: in conversation with Martin Sewell, CEO Rockar Tech

In a wide ranging interview with Sophus3’s Patrick Fuller, Martin Sewell, Managing Director of Rockar Tech, discusses the current state of play as the car industry seeks to enlarge its direct-to-customer capabilities.

PF

Well, it’s great to have you here with us today. And I think Rockar is a fascinating brand. You’ve been around for a very long time, helping the car industry recognize some of the opportunities of the direct-to-customer (D2C) relationship, which has obviously accelerated in recent years. So what do you think about the current state of play? How do you think the industry is doing in that direct-to-customer relationship and what changes have you seen recently?

MS

I think it’s fair to say the industry is perhaps stalling on its desire to move to D2C. I think there’s a number of factors at play. Obviously, I’m going to talk about tech readiness, I’m going to talk about OEM readiness and also about dealer readiness. And I think there are a number of examples where different brands have had quite good approaches to the tech solution, good approaches themselves, internally—the way they’ve structured and prepared themselves—and also where their dealers have got on board.

I think what’s going on is that dealers were feeling very nervous—quite rightly so—to this approach and as they’ve seen executions perhaps not working out as planned, that voice has been amplified, putting pressure on a lot of brands to delay or, scrap altogether, their move to D2C.

We’ve got a saying that “success is made on a pile of mistakes”. So you need to learn and you won’t learn unless you ’go for it’, but of course these transitions can be very costly if they are not well thought through and executed.

I think it’s easier when you’re on the outside and looking in to see what’s going wrong. As I said, I classified those problems into three areas: tech readiness, OEM readiness, and dealer readiness.

If I focus on tech readiness, that’s probably an area that’s really easy to solve. You know, we’ve seen some real fundamental errors, things like not having a customer account functionality to enable omnichannel retail, which supports the customer, obviously, but it also supports the dealer in terms of being prepared and understanding what the customer is looking for, what stage they’re at in the process. Of course, from a OEM perspective, being able to see all the data that’s coming back from all the interactions that customers having both physically and digitally, assuming that they’re using the platform or the technology, should I say, at the point of sale in the showrooms, which of course I’ve yet to see happening at all. So how can you ever deliver an omnichannel solution without that behind you?

How will the customer journey evolve?

PF

The subtlety of the customer relationship is going to develop in the next few years in digital. How do you sell a product to someone in digital? It’s not just about facilitating a transaction, you get them to want it, in a sea of choice.

MS

That’s a really good question. I think the big challenge you’ve got—the bits that people really like about going to the dealership—is that personal touch, being dealt with as an individual rather than just another visitor to a point of sale website.
I’ll reflect back on that data later, but the tracking of the customer behaviour enables you to build a picture of the consumer and their choices and preferences from the car model they are interested in, the options, their funding types, the car they currently drive, and where they are in their sales process, within the funnel. We can track all this data and interaction—in the customer account that I talked about earlier on—this enables us to build a picture of the user and start to drive or engage them further with hyper-personalised communication. So each time they visit the platform, we can track their interests, their behaviour, the stage they’re at, and then we would then deploy the appropriate hyper-personalised communication via an EDM (electronic direct mail), which would then link them back to the platform every time.

This is the really interesting point: this is a massive sea change for the industry to get their heads around, about the use of data—and I’m going to talk about email specifically here—is that you have to keep people engaged because you’re not in the showroom. You can’t keep responding to a question on how they’re feeling. You’ve got to be able to do it digitally. So that means that the frequency of communications—assuming you can hyper personalise these communications— is going to be far greater than you’ve ever imagined before, as a car dealer or as an OEM. We’ve grown up in a world where we’ve told you just follow up the customer four times. They usually give up at the fourth time, if indeed they get that far.
Now, typically, somebody who’s hyper engaged, will get nine communication pieces over a two-week window. But actually, it never stops. Just the cadence changes depending on their behaviour and where they are in the sales funnel. So again, looking at the data that we have, we’ve seen customers that may have started the journey three or four years ago. Checking out now, they’ve had multiple communications but they’ve all been hyper personalised, they’ve been nuanced to the stage that they’re at, and been very relevant which makes them feel like they’ve been treated like an individual, giving then a better experience and not necessarily selling the dream of the new car but empowering them to be able to answer all the questions they’ve got.

PF

You touch on another interesting point there, which is the joy of car buying. You know, I come from a media background—a big brand in the UK, ‘WhatCar?’—and we used to be very truthful about the quality of the car, but we would always photograph it and present it in a way that made it look great, because people are thinking, “I’m getting a new car, that’s a fun process to go through.”

I was listening to José Muñoz, who’s the president of Hyundai globally, one of our clients at Sophus3, and they’ve been doing some proofs of concept with Amazon in the US. The thing he really liked about it was that a three-hour process in a dealership to transact, turned into a 15-minute process on Amazon. And I can really see where he’s coming from with that, but, at the same time, are you losing some of the pleasure of the car buying process, which helps you make a decision?

MS

Let’s not forget, Amazon is hugely successful at what it does. And I don’t think Amazon really is there to try and sell you the brand or the dream. It’s to facilitate a convenient way of getting the product you already want. So that 15 minutes is the very end of a long sales process for a lot of customers that is far from linear. We see them come in and out with different products and revaluating their cars, et cetera, all the way through.

What we see at the moment in dealerships, is customers doing all their digital research, as far as they can, and the last step is to go to the dealership—and really [the dealer] should be pretty much closing everybody that walks through their door. And that’s a bit like the point that you made there with Amazon: the customer’s already gone through all that research phase. They just want the car as quickly as possible and Amazon’s going to be able to facilitate that through a checkout.
But if you just wholly relied on that, and you closed all your dealerships and you didn’t have all your lovely point of sale websites, Amazon wouldn’t have anything to check you out on!

Can digital deliver a brand experience?

PF

The connection between digital and love or brand desire is still being established. Digital is still seen as a place to get information and to transact, not a place to experience. Is that something you guys get involved in and what is your approach to communicating the brand experience?

MS

I think here again lies some of the problem. I think e-commerce or digital is viewed as a channel, as a separate channel. It’s not, it needs to be interwoven with BAU [business as usual activities]. So digital can support the experience, rather than digital’s over ‘here’ and it’s just cold information and it enables you to check out. How can it enhance the experience? Back at the start of our conversation, I think we talked about some of the lessons learned with some of the earlier D2C (direct to consumer) implementations where they’ve not provided the technology—the platform that the customer is using at home—in the stores. Had they done that, that would save the customers having to go over what they’re looking for or spend hours reconfiguring a car with a car salesperson. So it just dumbs down that experience. I’ve gone through this already, but that’s a good example where the technology, the digital technology, can support the interaction. It makes it much easier for the car salesperson who’d be able to see what Patrick’s been looking at, what stage he’s at, what part exchange you’ve got: so you don’t have to bore them to death with lots of questions. Make it all about the transaction in the showroom. Turn it into a brand experience so that the sales people can spend more time getting the prospective customer excited about the brand and the product. So technology can do all of this: stop viewing it as a new sales channel that sits over here, under the auspices of the IT team. It needs to be part of Ops and ‘business as usual’.

Should we learn from other industries?

PF

So some of the brands that we talk to want to look outside the car industry for digital expertise, which is understandable given how much is invested by the mega brands in the customer experience, the customer relationship. Is that something that you’ve done? Have you looked outside the car industry to find examples of best practice?

MS

I think we do spend a lot of time going around other tech companies, going to conferences and listening to the new technology that’s coming. I think what we do in the motor industry is very unique. I’ve yet to find another industry or retail industry that buys the product back from a customer to facilitate a transaction and also would allow that customer to take the product away, to drive it around the roads of the United Kingdom, and then bring it back. And also, offering multiple funding types: so if you go onto a jewellery website, you can buy a watch and it’s either Klarna or some other form of HP. But when you look at the motor industry, we’re offering HP, PCP, PCH, and they’re all very different. And you need to be able to advise the customer on those products, and treat the customer fairly. So I think it’s extremely complex, so it’s very difficult to learn global lessons from other brands, but I think understanding how technology—as we were talking about earlier—how it can enhance the experience for the customer is key for us.

How can digital help to sell more EVs?

PF

So, it’s not news to anyone that EV sales are proving difficult with lots of fleet sales but not enough private sales. What role do you think that digital can play to help answer that challenge?

MS

A different customer experience or a different user journey for EVs, you’re differentiating them again, you’re making them an outlier. We need to overcome the anxiety so they need to be treated in the same way.

What is the best measure of digital performance?

PF

Finally, if you are measuring brand performance in digital, what’s your favourite KPI or measurement for that?

MS

One KPI, oh my goodness, you know, we have literally hundreds of data measurements that we use to optimise performance, but probably if I was going to pick one, I’d say ‘customer account creation’. So if a customer is motivated and engaged enough to create an account, when I say create an account, I mean that they’ve probably seen a number of cars they want to save to a wishlist that they can come back to. Nobody really goes “Hmm, I’m interested in this car, I’ll start an e-commerce journey and buy every time I come back”. As I’ve already talked about, they may take up to three to four years to do that. So this customer account is key for everything, and it will drive the marketing methodologies, the hyper-personalization of those communications and the ongoing engagement of the user. So yes, ‘customer account creation as a percentage of sessions’ for me!