The Indian car sector is on track to overtake the United States as the third-largest automobile market in the world.
Two experts from the automotive sector candidly examine the current situation of the sector and its future in this webinar:
- Rohit A T, Head – Product Ops & Process Excellence, OLX Autos
- Archit Mahajan, Regional Sales Manager, LeadSquared
New trends in India’s used car market
The development of e-commerce, improved dependability, the application of digital marketing techniques, and amenities for a hassle-free client experience are a few of the important developments in the used automobile market.
The intention to buy new and used automobiles over the next 12 months is virtually back to pre-COVID-19 levels (new cars at 94% versus pre-COVID-19 levels and up by 7% over September 2020; used cars at 97% versus pre-COVID-19 levels, up by 1% compared to September 2020).
We asked 45 attendees about how car sales have changed after the pandemic. And nearly 32% of them reported an increase in case sales.
The pre-owned car market is dominated by unorganized participants; among others, Maruti Suzuki True Value, Mahindra First Choice, Hyundai Promise, and Honda Auto Terrace are some of the segment’s organized participants.
The organized sector’s market share will increase from its current 25 percent to 45 percent by FY25. This is a blatant example of how customer preferences for personal mobility have changed. Compared to new automobile sales, the market for used cars will continue to grow.
The Economic Times research states that over 40 million used cars were sold globally in FY22. Out of these, 3.5 million were sold in India alone, beating the previous year’s record
The used car market in India is transitioning from an unorganized space to a more formalized one.
This is attributable to the entry of more businesses into the market, as well as an increase in transactions between car owners, small-scale brokers, and roadside technicians.
The shift is expected to result in greater efficiency and transparency in the used car market in India.
Digital transformation in the automotive sector: Improving client experience
Online car searches are becoming more popular among consumers. The auto sector is undergoing a digital transformation that aims to move various client touchpoints online, from inquiries to deliveries. Customers enjoy a lot more individualized and user-friendly experiences, and automakers and dealers can target and interact with them better.
Businesses have benefited from transitioning into digital, which holds true for the automotive industry as well.
For instance, 40% of business executives feel that digitalization helps them satisfy customer expectations more effectively, and 35% of executives say they want to increase their investment in technology to gain a competitive edge.
An essential customer-centric mindset is what drives the acceptance of digital transformation. This motivates the use of cutting-edge platforms such as social media and virtual and augmented reality (VR/AR) to enhance the client experience. Even post-sale services like maintenance and insurance are becoming available online, making it simpler to complete transactions and manage vehicles without fuss.
McKinsey validates the value of car dealers having a digital presence for their clients in one of their insights. According to the survey, post-pandemic purchase intent decreased by 8 percent for offline purchasing journeys but only 2 percent for clients who primarily use digital channels.
Those businesses who jump in and develop brand affinity through experiences on the digital channel are reaping the rewards as digital plays an ever-more-important role in the car purchasing process.
A case study: How OLX scaled up in a customer-centric way
In 2018, OLX launched OLX Autos, which would obtain used automobiles from sellers and auction them to designated channel partners. This was in addition to the OLX internet marketplace.
They wanted to make sure that customers had seamless experiences with the offline retail channels just like they do with their online counterparts. Sales personnel needed to make deliberate, individualized suggestions based on in-depth knowledge of each customer when they went out to meet dealers rather than just rattle off a list of products.
They saw the need for a mature CRM platform to optimize the performance of their sales teams while also providing a great customer experience. In order to achieve these objectives, they needed a robust CRM system.
They rapidly realized that they would need strong global support in terms of integration, linguistic abilities, and more as OLX Auto went up internationally. All those options were checked by LeadSquared.
“Car dealership sales is a fast-moving environment with multiple touchpoints. If your CRM is too complex or too basic, sales guys end up playing with the system more than doing the actual selling. This is where a connected system like LeadSquared helps. It’s easy-to-use and connects all our third-party apps into automation to shorten our customer acquisition time.”Anthony Lopez, Managing Partner, DSR Leasing
The future of the automobile industry
The auto industry is changing directions. The car business is changing simultaneously on many different levels as a result of global disruption, technology advancements, and shifting consumer habits.
The conventional business paradigm of creating, producing, marketing, and financing vehicles is still in use.
The automobile industry is moving quickly toward a new future that includes electric cars, connected vehicles, mobility fleet sharing, onboard sensors, new business models, and always-on connectivity. This movement is being pushed by sustainability and changing customer behavior.
“The customer acquisition cycle begins with marketing efforts to reach potential customers. Those potential customers are then funneled into a CRM, in our case it is LeadSquared. The entire customer journey is then managed through LeadSquared, which has been helpful for us in various ways.”Rohit A T, Head – Product Ops & Process Excellence, OLX Autos
Recently, we surveyed sales professionals about the potential to automate operations in the automobile sector. We found that processes like capturing leads from websites, ads, and marketplaces, customer engagement, and sales workflows can be easily automated.
Boost your earnings from used car sales, cross-selling, and services with LeadSquared CRM. Transform the way you sell cars with us!
Book a 15 minutes demo with us today!
The two-wheeler market in India is very large, but it has very low margin and high volume. The same manpower that is used to work on a car would produce much less revenue when working on a two-wheeler.
The organized market (dealerships and marketplace players) currently makes up around 10% of the total market, while the unorganized market makes up around 60%. However, this is changing, as consumers are becoming more interested in working with trusted, organized players. It is estimated that by 2025, the organized market will make up 50% of the total market.
The number of small, independent car dealerships will decrease in the next few years, as larger, more organized companies consolidate the market. They say that this trend is already happening and that smaller businesses are struggling to compete and around 50% of the market will be controlled by the organized players.
Rohit A T
Head – Product Ops & Process Excellence, Olx Autos
Rohit brings with him over 15 years of experience in the Automotive and e-commerce industries. In his current role at Olx Autos, he is responsible for building and scaling the systems and processes for India operations. He has extensive experience in the automotive field as a robotics & automation engineer at the Tata Motors plant. He also holds deep experience in scaling tech-enabled operations in the e-commerce space, in his stints with Snapdeal and Altisource earlier.
Regional Sales Manager, LeadSquared
Archit is the Regional Sales Manager at Leadsquared & he has a keen inclination toward helping business leaders scale up their sales & marketing functions. Over the last nine years, Archit has pursued his entrepreneurial dream and worked with one of the fastest-growing start-ups in the Indian ecosystem. Archit is passionate about building new businesses from scratch & driving revenue through sustainable business channels.