BMW is completely changing the car buying experience for its customers.  The company is employing fewer sales people, ripping out showroom cubicles, installing flat screen televisions, and hiring “product geniuses” to explain the technology in its automobiles to customers.  This move comes as companies begin to realize that customers prefer the atmosphere and ultraclean look of Apple stores to cluttered and chaotic showroom floors.  BMW will do away with the balloons and banners that once dominated automotive dealerships and will instead create an environment that is more digital and hands-on.  BMW also announced that it will create regional fleets where customers can go to test drive cars.  This means that dealerships can stock fewer new cars.

At the recent National Automobile Dealers Association convention, it was evident that many companies in the automotive industry are turning to new software to help them update the shopping experience.  For example, Startup SwervePay LLC is offering new mobile-phone software that allows dealers to coordinate payments and service work via text message.  Seminars at the convention offered insights into selling more cars with Google Analytics and using mobile technology to reach new customers.

The auto dealership of the future will be very different from what it is today.  Joe Shaker, owner of Shaker Automotive Group, suggests that the experience has to be more hands-on and retailers have to offer more interactive displays and virtual demonstrations to engage the customer.  Dealers will also begin to hold more new-car inventory off-site to save on real estate and inventory costs.

Discussion Questions:

1. What factors are driving BMW’s decision to change the shopping experience it provides in dealerships?

2. Would you prefer the new or the old way of buying a BMW?

 

Source:  Christina Rogers and Joseph B. White, Wall Street Journal, February 19, 2014; © Randy Faris/Corbis Extended Credit Required= N Business Unit Rights = MHE North America Asset Source= Corbis