Chatbots Fill Car Buyers’ Demands for Speedy Answers, Service

car shopping online

For retailers that have operated through the pandemic, one of the takeaways they’ve learned is that they must offer personalization — serving customers in the way they want to be served.

For car dealerships, that has meant adding an option to buy cars online and have them delivered. Some consumers want to visit the dealership while others want the experience to be contactless, so dealers have ramped up their ability to offer both options.

“Dealers are really focusing on more, ‘OK, how do I serve that particular customer because they wish to be serviced in this particular manner,’” Bryan Xu, co-founder of DealerAI, told PYMNTS. “The whole digitalization and the technologies really enable them to be able to do that.”

Serving Those Who Prefer to Communicate via Chat 

However they end up making the purchase, consumers start their shopping online, researching cars on the websites of dealers, automakers and third parties. This has been accelerated by the industry’s inventory shortages; because fewer cars are available on dealer’s lots, consumers have been encouraged to pick a car online, put down a deposit and wait for it to be delivered.

During their research, many consumers also prefer to communicate via live chat. Another effect of the digitalization that’s happened during the pandemic is that people expect answers instantly, at any time.

“People that are getting on chat, that doesn’t mean that they cannot see on the website, it’s just that they prefer chat as their communication approach,” Xu said.

More Conversations Means More Leads and More Deals 

To meet this demand, more than 90% of the car dealers in North America offer some sort of chat. Most of it is human live chat but another option is artificial intelligence (AI)-powered chatbots.

Dealers choose AI-powered chatbots for several reasons. First, chatbots give answers that are consistently accurate because they are looking directly at the data.

Second, chatbots provide consistency. While human live chat relies upon staffers with different levels of experience, chatbots will always give the same answer, and while a staffer’s knowledge is lost when they change jobs, chatbots retain their knowledge.

Third, chatbots give answers that are timely — where it typically takes a human between 8 and 15 minutes to look up and type out an answer, chatbots do it instantly.

“With this, we know that you will get an increase in the number of conversations that you’re having,” Xu said. “And everything is based on the conversion rate — the number of conversations increase, the number of leads will then subsequently increase, and as the leads increase that means you have a better chance of closing more deals.”

DealerAI chatbot

AI Engines Are Continuously Learning 

DealerAI finds that among the questions consumers ask online, about 31% are inquiries about new cars, 20% are inquiries about used cars, 28% involve bookings for service or other in-store visits and the remainder ask for general information.

Chatbots can handle 90% of the questions they are asked. For the other 10%, they will ask for the consumer’s information and pass that on to the dealer so they can follow up.

They can also learn the answers to questions that they were unable to answer. In some cases, the inquiry will be sent to an engineer at the software developer who will then look up the answer and send that into the AI engine. The next time the chatbot is asked that question, it will know the answer.

In other cases, the AI engine can learn the answer itself. Xu gave the example of an AI engine that may learn that the answer to the question, “Are you open on Sundays?” is the same as that for, “Are you open on Sunday?”

Providing Quick Answers Boosts Engagement 

Chatbots also capture the questions they are asked and share them with dealership staff. From this, dealers can learn such things as which vehicle models, auto parts and services the shoppers have asked about.

From this, dealers can see what sorts of promotions might help incentivize shoppers to make the purchase.

At the same time, because the chatbots answered the shoppers’ questions, those shoppers are engaged with the dealership and more likely to buy the product there.

“An engagement is where you have actually helped the end customer,” Xu said. “Even though they do not give you their phone number and email address at that time, the fact that you have helped them, they’re more likely to transact with you down the road.”