Artificial intelligence (AI) has weaved its way into multiple facets of our daily lives. From smart homes to autonomous vehicles, it’s becoming increasingly challenging to imagine a world without it. But beyond just consumer-facing products, businesses too are realizing the indispensable role AI can play. The latest sector catching up with this trend? Automotive dealerships.
According to a recent market research report by CDK Global, Inc., a significant 76% of dealerships credit AI for enhancing various aspects of their business, ranging from sales to inventory management.
Here’s a Deep Dive into the Key Takeaways from the Report:
- AI Virtual Assistance is All the Rage: Dealerships are significantly intrigued by the prospects of AI virtual assistance. With an emphasis on real-time updates, predictive service, and overall operational efficiency, it’s no wonder AI tools are witnessing increased demand.
- Commitment is Growing: From the 2021 survey to its latest iteration in 2023, the commitment to AI adoption has seen notable traction. A promising 20% of auto retailers are gearing up to deploy applications rooted in machine learning and natural language processing in the forthcoming years.
- AI – The Problem Solver: The survey sheds light on multiple concerns within the auto retail sector:
- Employee Burnout & Skill Shortage: About 57% of dealers feel the heat of employee skill shortages and staff burnout. AI offers a solution by automating tasks and optimizing the skill sets, allowing the workforce to prioritize customer service.
- Inventory Management Woes: Managing inventory is a critical challenge, with 49% of Sales and F&I leadership focused on it. AI comes to the rescue, forecasting demand and calculating necessary inventory based on market insights.
- Converting Sales Leads: Almost half the respondents (44%) pinpoint the challenge of sales conversion. AI, with its predictive prowess, can help dealers identify potential buyers and suggest relevant vehicle options.
- Current Adoption Metrics: The numbers speak for themselves. A robust 67% of dealerships are already employing AI to identify and engage with qualified leads – a commendable jump from 56% in 2021.
- Return on Investment (ROI) Optimism: With 60% of dealers expecting positive outcomes from AI (compared to 56% in 2021), it’s evident that the industry is optimistic about AI’s ROI. Especially in departments like Service, Sales, and Marketing/Advertising.
- The Cautionary Tale: Despite the optimism, there’s a section of dealers who tread with caution. Concerns span from fearing a loss of human touch and personal connection to apprehensions about the tangible ROI. Not to mention, the perceived complexities in setup, training, and resistance to change.
However, as Emily Hernandez from CDK Global highlights, the aim of AI is not to render the human workforce obsolete. On the contrary, AI aims to empower employees, enabling them to better cater to customer needs and improve the overall consumer experience.
In a rapidly evolving automotive retail landscape, staying ahead of the curve is critical. And with AI’s demonstrated potential, it’s clear that its role will only grow in stature, promising a future of enhanced efficiency, improved customer experience, and optimized operations for dealerships.