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Automotive

How can AI impact car dealerships?

By Jon Taylor on 14/01/19 16:24
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Jon Taylor

With sales levels down and profits being squeezed, 2019 could be yet another challenging year for UK automotive businesses. For car dealerships in particular, changing consumer behaviours and increasing manufacturer demands – combined with political and economic uncertainty – will be the causes of many a sleepless night.

In an increasingly turbulent market, it’d be easy to get bogged down in the negativity that currently surrounds the sector. However, our experience of the automotive industry shows us that there are things companies can be doing to turn their fortunes around. We are, of course, talking about the impact of artificial intelligence (AI).

When you think about AI for automotive, driverless cars and robot-powered production lines are probably the first things that spring to mind. However, we think of it from a different perspective; it’s a way of solving complex business problems using data, analytics and clever machine learning algorithms.

Let’s look at two ways in particular that AI could drive car dealerships towards a brighter future...

1) Improving the customer experience

Much like the wider retail landscape, customer demands and behaviours are changing in the automotive industry. For instance, 88% of millennials are now researching the car they’re interested in online prior to visiting the showroom – the days of charming the ill-informed customer into making a purchase on the forecourt are now long behind us.

Now, it’s up to dealerships to ensure that they’re doing enough online to ensure that a visit to the showroom actually happens – and that’s where AI can be a huge asset.

We use AI to put the right information, products and services in front of the right people at the right time – when they are most likely to buy – by monitoring their online behaviour, buying habits and preferences. This allows you to get a clear of idea of what car they’d most likely be interested in (as well as colour, spec and any desirable extras) and makes it possible to target them with hyper-personalised advertising (think email, phone or even postal) at the optimum time, rapidly increasing the likelihood of a sale. It’s worth noting that this can be applied to both car sales and any additional servicing requirements, too.

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2) Optimising the supply chain


We can also see evidence of AI in the automotive supply chain through the relationship with the car manufacturer. By monitoring what demand looks like at any given time, dealerships can have better-informed conversations with manufacturers, and therefore better manage stock distribution to stand more chance of meeting their sales targets (and qualifying for that all-important bonus.)

Buyer preferences vary enormously across the country, and by leveraging your existing sales data, AI can help to spot existing (and predict future) buying trends, ensuring that stock levels are optimised on a granular level. For example, we can suggest which makes and models to order in, which colours will sell the best, and which extras could be fitted to help them sell more quickly.


Of course, the capabilities and potential for AI in automotive go far beyond just these two examples. If this is an area of interest for your car dealership, check out our case study with automotive retailer Regit – using AI-powered lead scoring, we increased the company’s sales by 27% in just 30 days.

To find out more about the ever-increasing role of artificial intelligence in the UK automotive sector, make sure you download our free resource – 'UK Automotive: Driven By AI'...

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