Rethinking car buying for a new generation
Wednesday 27 October 2010
A new website that promises to connect car buyers with dealers could be about to change the way we purchase new vehicles - without removing the age-old practice of haggling for a better deal.
Although cars are easy enough to buy online nowadays, many buyers still opt to head for showrooms for that personal touch, often because they believe salespeople have some leeway in the price that they can charge or may throw in some extras - despite the fact that they may not really want to.
New startup CarWoo thinks that it can bring haggling to your computer, connecting buyers and dealers to agree a price and then confirming an offer, meaning all that's left to do is pop down to the dealership and pay for your new wheels.
Buyers pay a one-time fee which starts from $39 (€27.95) to tell dealers what sort of make and model they're after and then sit back to wait for the offers to come in.
Armed with quotes from the different dealerships, prices can be compared and negotiated until a satisfactory deal with one dealer is reached - and the dealer must promise not to haggle over the price when the car is collected and paid for.
The service was recently featured by tech and social media website Mashable, which pointed out that it's picked up some fairly impressive backing to enable it to build its service, which currently consists of some 3,000 dealers in the US only.
Although connecting buyers with dealers has long been an online business model for companies such as FindsYouCars.com, Cars.com and even eBay, it's not always that easy - General Motors and eBay ended a collaboration in 2009 after it reportedly failed to sell more vehicles.
Despite this, efforts are likely to be spurred a recent report by Microsoft earlier this year which suggested that younger car buyers want to cut out the car dealer altogether.
The study, conducted by Wakefield Research, found that 70 percent of US Millennials (the generation aged 25-34) said that dealers make the process of buying a car harder, not easier and that they want more transparency in the buying process.
"The sales model hasn't really changed since the days of the Model T - you walk into a dealership and see a line of desks, then someone jumps up from one of the desks and tries to sell you something," said Microsoft's David Graff at the time.
"These are people who are as comfortable interacting with devices as they are with people. This means the old sales model for cars may not work anymore."
CarWoo, which minimizes interaction with dealers and says that customers are "guaranteed to get the car you want for an amazing deal", might just be the solution.
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