The devastating impact of Covid-19 on multiple business sectors across the UK, cannot be overstated. Solely responsible for the collapse of thousands of businesses and the resulting loss of countless jobs, the pandemic has destroyed the livelihoods of employers and employees alike. Jerry Young, chief executive of ieDigital, writes

The UK’s motor sector is no exception. The Society of Motor Manufacturers and Traders (SMMT) has reported a year-on-year drop of almost 40% for January new car sales for 2020 and 2021. With showrooms closed and dealerships remaining largely deserted, selling either brand-new or used vehicles has been made infinitely more difficult.

The global pandemic has changed the way we live, work and shop. And while Covid’s impact on the steep decline in car sales isn’t in doubt, it raises the question of whether it masks a shift in the way motorists want to buy and sell cars – and whether those that offered an online service fared better than traditional dealerships.

Direct parallels can be drawn here with other parts of the retail sector, which has seen a raft of famous stores disappear from our high streets. Shoppers turned to online platforms, while many traditional retailers responded by facilitating online shopping, Click and Collect services and home deliveries. Overall, online sales accounted for a third of all retail spending last year – a record.

Those in the motor sector that had foreseen this e-commerce shift – which was emerging before the pandemic – are likely to have fared better than those that continued to rely on customers visiting their dealerships. It was noticeable that Aim-listed Vertu Motors recently revealed that it had met its £23m profit target despite three national lockdowns – and in part this was due to strong digital sales.

You’d also be hard pushed not to have noticed television adverts from motor retailers, heralding their completely end-to-end digital car-buying process as a car-buying “revolution”. Indeed, one of the most prolific advertisers, Cazoo, is reported to be planning a £5bn stock market float, having launched little more than a year ago.

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By GlobalData

However, in the main, I strongly suspect that the move to digitisation for most in the motor trade is behind the curve. Before drafting this article, I took a look at which of the most popular 10 cars in the UK can be researched, bought, signed-for and delivered, solely online from the comfort of my own home.

It was notable that even today, given the advances of technology, that some motoring giants still make it hard to carry out all stages of the purchase remotely. They all make it easy to research vehicle specifications, colour-schemes and prices – but when it comes to arranging finance and signing on the dotted-line, it is a different story for some of them.

It makes you wonder whether car sales would have fared a little better during a year of lockdowns and tier restrictions had more offered a fully digitised service. Dealers recognise that customer expectations of an online service have accelerated in the wake of the pandemic, yet according to a survey by MotoNovo many admit that they haven’t developed their digital strategies to address this change.

The shift to online buying will take time and it will not be wholesale. There will always be a significant number of buyers who will want to visit a showroom – but implementing a digital capability should be seen as a vital complementary service at the very least.

With digital solutions offering a competitive advantage right across the sector, now is the time to act. Our own experience of working with motor retailers to elevate their digital route-to-market has highlighted the mammoth strides forward that can be achieved.

Deploying digital services is not the time-consuming, expensive undertaking it once was. Bespoke solutions for the motor sector can be created in as little as four months, resulting in a level of service that will open them up to a whole new audience.

Chancellor Rishi Sunak has also emphasised the importance of UK businesses embracing digital with the ‘Help to Grow’ scheme announced in the Budget that will offer discounts on software to smaller businesses.

While Covid has undoubtedly had a major impact, it has only accelerated a major digital shift that was already well underway beforehand. Traditional retailers are increasingly adopting the digital phenomenon, as have banks and fast-food outlets, who no longer rely on customers physically popping by.

Now it’s the turn of the motor sector. The ability to carry out all stages of procuring a vehicle online, from researching and carrying out checks, ordering customisable extras, to arranging finance, signing documents, and taking delivery, is now no longer a ‘nice-to-have’. It is an essential ‘must-have’ that should not be ignored, even as dealerships reopen and we begin the move into post-pandemic life.