When it comes to buying a car, most people probably think the more choices they have the better able they are to make an informed decision. However, analytics experts at Google studied dealership inventory and brand websites and determined that consumers can be easily overwhelmed if those choices are not managed properly.
According to Ward’s Auto, dealerships and automaker websites that give consumers too much to navigate can leave people frustrated, and it’s difficult to turn frustrated customers into buyers. Neil Hoyne, Google’s head of customer analytics, is trying to get dealerships and automakers to re-think their customer experience. While many high volume dealerships advertise the “largest selection available,” this could backfire if a customer feels overwhelmed by all the choices.
It’s important to note that many car buyers do a significant amount of research before visiting the dealerships and therefore if they already have a specific car picked out, having a large selection of inventory might be advantageous. Large volume dealers often can afford to give bigger discounts because they will meet or exceed their sales quotas set by the manufacturer.
What Hoyne is referencing in regards to dealerships, is the consumer who doesn’t have a clear direction on what they want. These folks can get “lost” in vast variety of vehicles available, but this is why good salespeople are trained to conduct a “needs assessment” upon greeting the customer so they can focus their direction into a smaller selection of cars.
While large dealerships can manage customer confusion with a well trained sales staff, Hoyne says that automakers need to be careful about how they offer vehicle options and configurations on their websites.
“By giving people more choices, they can get confused and end up buying less,”
This concept that “more is less” when it comes to consumer behavior has been around for awhile. In 2004 Barry Shwartz published “The Paradox Of Choice” in which he analyzed the decision making process and found that when presented with too many options, many people find it difficult to make the right call.
Hoyne looked at online vehicle configurators and found buyers preferred pre-determined configurations or “packages.”
“People end up spending almost $2,000 more on a vehicle when choices were opted in for them...Defaulting is easier for them than having to make too many choices.”
For example, if you visit Acura’s website, their options are much more streamlined than BMW. As to whether or not Acura’s choice of “bundling” increases their sales potential is difficult to measure. Most likely Acura gives these limited selections for manufacturing efficiency, as they don’t allow you to custom order your sedan or SUV, like BMW does.
On the other hand, not giving consumers enough control, can be frustrating as well. Hoyne warns against increasing the “click rate,” normally a good thing for websites, because if a customer can’t find what they want they will often go elsewhere. When Volkswagen introduced their new “dating themed” website and removed the “configurator” I found it to be a step-backwards from their previous effort. Apparently, I wasn’t the only one, and VW brought the “build your own” option back.
The irony about all of this is that if Google had their way, car buyers would have no choice at all.
Until then, consumers will have to navigate the maze of websites and dealership lots. Have you ever been overwhelmed when visiting a large dealership? Which automaker websites have the easiest to use configurators? Who has the worst?
If you have a question, a tip, or something you would like to to share about car-buying, drop me a line at AutomatchConsulting@gmail.com and be sure to include your Kinja handle.