The Internet has greatly enhanced how consumers buy goods. People can vet prices, assess product features and choose to conduct purchases online, versus a more traditional, brick-and-mortar businesses. This affects goods and services of all kinds: from groceries and books to subscriptions, furniture, electronics and even major purchases like cars and real estate. This article explores automobile purchasing through online outlets and outlines what to consider and which steps to take to ensure you make your purchasing decisions responsibly.
Traditional Car Buying vs. Online Car Buying
Ten years ago, buying a car online was not a common occurrence. While some early adopters of online shopping may have taken online steps in the direction of purchasing a vehicle, start-to-finish automobile purchases were not yet happening at all, and they certainly were not a common way to buy a vehicle. Today, online car buying is widely available, and it is growing as a purchasing channel for vehicles. In fact, online buying allows you to purchase cars in another state and transport these vehicles across states, making the process even more convenient. Dealerships now offer start-to-finish car buying experiences. Consumers enjoy the convenience this offers.
It used to be the way to buy a car involved going into a dealership after making some preliminary calls to connect with a salesperson, or to check inventory. Many dealerships walk-ins happened without advance planning, where customers who knew they needed to buy a car would simply walk in to assess some options on impulse, without calling first. Many still do it this way, though the traditional method is far from ideal, for the following reasons:
- Dealerships do not always have enough sales staff to give adequate attention and time to all walk-in customers
- While walk-in customers are curious about options, they are often not quite ready to buy. Salespeople at dealerships are trained to upsell people and close the deal at all costs, so they do not leave the dealership to go to another one. This creates a pressured, sleazy atmosphere that people associate with the dealership experience.
- Pricing can be confusing, and one of the hardest actions a customer can take at a dealership is trying to obtain a price for the vehicle you are seeking. While some dealerships have switched to a transparent, posted pricing approach, many still confuse buyers with special deals, financing details, and taking time to talk to their manager for price breaks. It is hard for customers to feel trusting of salespeople at dealerships for this reason. Another downside is that this pricing approach takes a long time and multiple iterations before a customer has the vehicle’s final price,
Online car shopping has been around for a number of years, and it answers a lot of the pain points of the traditional car buying process. Customers can browse online at their convenience and see what inventory is available where, check history of a car, whether it's been stolen or not. The details of vehicles and their prices are clearly posted online. People have time to conduct research about vehicles that interest them without feeling pressured by salespeople. Dealerships can save a lot of time and resources by having vehicle information posted online, and avoid pricing misunderstandings. Customers can fill out financing paperwork online and know exactly what their new car payment will be. Trade values can be assessed online, and customers that want to conduct a test drive can schedule them online as well. By the time a customer actually goes to the dealership, he or she has provided all their key information to the dealership online, so all that needs to happen is the test drive and / or the vehicle pick up.
How to Buy a Car Online
If you have decided to give online car buying a try, here are some steps you can take to navigate the process:
-
Research the Vehicle Type, Make, Model-Based on Your Needs
First and foremost, assess your lifestyle. How many people need to fit into the car comfortably? What features do you need based on your lifestyle? What strong preferences do you have as a driver? Asking yourself these questions should greatly help you narrow down your list of potential vehicles.
-
Check Consumer Reviews, and Statistics for Quality Assessment
Once you have a list of potential vehicles, conduct some research about how they all perform. Consumer reviews are great, as well as looking up key statistics, such as:
- Gas mileage
- Lifetime ownership cost
- Recalls on same/similar models
- Safety ratings
- Common quality issues
This step should help you narrow down your list of potential vehicles and to ultimately find the right make and model for you. Also, don't forget to check your car for recalls.
-
Test Drive
Most online vehicle purchases have the ability to offer you a test drive. In some cases, people buying a vehicle that is located far away may opt to skip the test drive, or to visit a local dealership near them to drive a similar model. This can give car shoppers an idea about how the vehicle they plan to buy online handles and feels. Test drive skippers may have timing constraints or particular experience with previous models of the same make that puts them at ease with purchasing without test driving. If you are doing a test drive, this is the time to touch, feel, experience and ask questions.
-
Set a Budget
This is a very important factor to consider. Many are confused by how much they should spend on a car. To determine your ideal budget, first, consider how you plan on structuring the payments. Do you have a bulk amount that you want to use for a down payment or entire amount? Or will you be seeking financing? Perhaps it is a combination of the two.
If there will be a gradual repayment of any kind, think about how much you want to spend per month. Then, assess the size of your down payment. Find an online payment calculator, which is available on most auto reseller websites and get an idea of what you can afford based on those two metrics. If you do not plan on repaying this purchase monthly, you can save money on interest, but your budget becomes the flat dollar cost that you want to spend.
-
Finish Up at the Dealership or Get the Car Delivered
If you completed most of the auto purchasing steps online, you can still finish up and provide signatures and payment at the dealership. By doing most of the paperwork online ahead of time, you still save a lot of time and hassle. Gone are the days of sitting in a dealership for hours over a weekend, waiting for your salesperson to speak to his or her manager and seek out all the necessary forms for you. Instead, this becomes a quick stop that focuses on the final steps of the buying experience, including picking up your vehicle. In other cases, car buyers may not even need to go to the dealership, as their new vehicle can be delivered to their home.
It is great to know that the way we buy cars is changing and becoming more advantageous and convenient for the consumer. Buying a vehicle online can save time, hassle, and remove the guesswork and negotiation layers around pricing.
