Are we at the dawn of the robo-dealership?

We explore how the use of artificial intelligence can grow sales


Guests arriving at one business hotel in Tokyo are now welcomed by android receptionists and invited to check in. Whilst this may seem rather futuristic, the use of artificial intelligence (AI) is growing and it’s becoming more prevalent in UK motor retailing.

Over the past few years, vehicle manufacturers and dealers have seen significant changes in the way consumers shop for cars with a far greater emphasis on web-based research, that’s resulted in dramatically reduced showroom footfall.

As such, traditional communication channels and in particular, email marketing, are failing to engage potential buyers as they once did. Retailers are turning to more sophisticated digital technologies, which harness AI, in order to capture consumers at exactly the right time with exactly the right messages. Such technology is all about the data and how it can be utilised smartly in order to increase revenue. At the moment, AI in an automotive context is mainly thought of as driverless cars but there is considerable potential for it to transform the whole supply chain.

Automated support could also complement existing customer service staff, who would continue to take care of more complicated issues and be available to help customers face-to-face.

At a dealership level, AI enables motor retailers to understand their customers better than ever before, giving them a competitive advantage. By using machine learning algorithms to analyse customer behaviour and purchasing habits, such as how someone is navigating through a website, AI can put the right information in front of the right people, in the right way, at the right time. Not only does the translation of data intelligence into tailored communications increase the chance of a sale but it also improves customer retention and business reputation.

The impact of AI on the automotive retail supply chain is also evident through the relationship with the car manufacturer. By monitoring what demand looks like at any given time, retailers can have better-informed conversations with manufacturers and therefore manage stock distribution to where that demand is. On a strategic level, becoming AI-driven can help automotive retailers better understand their business and help them forecast more effectively. It can even be used to predict dealer profitability (net profit as a percentage of turnover) with a proven high degree of accuracy, which is particularly beneficial during a challenging economic climate.

Most of us have already come into contact with AI, in the shape of personal assistants developed by Apple, Amazon, Google and Microsoft, for example. Such ‘chat bots’ are highly developed computer algorithms, designed to mimic human response and even behaviour, using increasingly powerful software to create a form of artificial intelligence.

In regard to convenience, the beauty of a chat bot is that it is always awaiting a command, which has significant potential to eliminate the bane of telephone queuing, as response parameters become more sophisticated. As consumers become more used to conversing with computers, it follows that increased familiarity should pave the way for greater trust.

For dealers, speed of service and accuracy of information are crucial factors in satisfying customer expectation, which is why the use of chat bots has considerable potential. Using them could reduce the number of simple, high volume enquiries customer service agents have to deal with, freeing them up to provide faster assistance with more complex queries.

At the moment, chat bots can only imitate human understanding, unable to engage in detailed conversations. By integrating the technology with Artificial Intelligence (AI), however, there’s scope for a more ‘conversational’ chat bot, that could undertake advanced speech and recognise user intentions, even down to the tone of language. This level of automated support could complement existing customer service staff, who would continue to take care of more complicated issues and be available to help customers face-to-face. Developers believe chat bots could respond to enquiries of increasingly complexity, such as stock checking, arranging a test drive or booking a service.

It follows that by enabling quicker and more efficient interaction with customers, a business will have competitive advantage. Similarly, engaging them via the use of technology will have particular appeal to the younger generation of car buyers, in a rapidly evolving market.


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