The recently released Microsoft Search in India 2021 report shows that online search for used vehicles went up eight times between January 2020 and 2021. Search for scooters went up 24 times, while that for online two-wheeler insurance went up 21 times. Does this imply three clear trends – (1) preference for used cars over new, (2) preference for two-wheelers over cars and (3) preference for online purchase portals over physical?
The post-pandemic world will certainly recast the way an Indian goes about the journey of vehicle choosing and buying. Realising this, a few automakers have already digitised as many of the interfaces in the customer journey as possible. And we are seeing a mushrooming of third-party aggregator platforms, which are fusing information sites with buying sites. A decade back, we had a clear demarcation between the two. A Carwale used to be a platform for evaluation and lead-generation, while a CarTrade was a used-car one. Today, the roles are blurred as both categories are going in for forward / backward integration.
A Carwale, OLX Autos, Droom or CarDekho is a direct threat to the automaker’s used-car business vertical. As most automakers have treated this vertical as an ‘appendage’ for long, the independents have had the first-mover advantage when it comes to variety, price points and value-added services like documentation.
Given the growing preference for used vehicles, automakers are now scurrying to integrate the entire buying solutions across new and used vehicles. On the other hand, the aggregators are busy incorporating new vehicles in their repertoire.
The clear way forward for aggregators to remain a step ahead of the automaker-based solutions is to incorporate interfaces like test drives, user reviews, expert opinion, refurbishments, and ‘spatial computing’ (for digital 360-degree vehicle inspection and evaluation). The current state of operation is a rudimentary marketplace which is kindergarten level compared to global platforms like Carvana, Vroom and Roadster.
Also, we are yet to have desi versions of eBay Motors, Craigslist, and FB Marketplace.
The automaker will always have primary focus on the new vehicle as the basic turf. The aggregator will have to collaborate with all automakers to ensure it does not get pushed out of the new vehicle space, by improving on its lead-generation to evolve into lead-conversion. It does sound a bit complex right now, with the new vehicle network also in the fray, but then the traditional brick and glass showroom can be slowly phased out, with the set-up focusing on servicing, refurbishments, detailing and other physical value additions. The egos of the automaker must be shed to allow this, along with greater transparency at the end of the aggregator.
All in all, I see a more customer-led consumer-focused vehicle buying experience being available across the price bands and vehicle types sooner than we had imagined!
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