Do you remember when subscription services overtook existing methods of media consumption like physical ownership? It seemed impossibly simple: you pay a nominal monthly fee, and gain access to a vast library of content with almost no limits.
The internet changed what it meant to own something. Instead of slotting one more title into your DVD library or CD shelf, you have access to all your favourites and more from any internet-enabled device (even your car). This same approach to ownership isn’t limited to media; the next car in your driveway could be a subscription service.
Wait, how does that work?
If you’re wondering how a person subscribes to two-ton piece of metal, let’s let Volvo explain their new subscription service, Care by Volvo, which they released this summer:
Care by Volvo is the all-inclusive way to enjoy a new Volvo. Subscribing to a Volvo will provide customers with all the extras and perks in one complete package. Winter Wheels & Tires, maintenance, road hazard protection and normal wear-and-tear are all rolled into one flat-rate monthly payment. Subscribe to a Volvo and enjoy a simple ownership experience.
Just like subscription music or television platforms, subscribing to a car offers an easier balance of benefits to accountabilities. Consequently, customers receive the usage perks of ownership without the onus of maintenance or upkeep. The customer doesn’t need to spend money on wheels, tires, roadside assistance, oil changes, or scheduled maintenance.
Perhaps even more compelling, the customer doesn’t even need to think about any of those complex decisions. As a result, the biggest burdens of car ownership simply disappear, letting the customer enjoy their car unrestrained. The monthly payment doesn’t just buy the vehicle, it buys driving as a lifestyle.
What’s in it for my dealership?
Here’s where things get really interesting, though – especially for the dealer. So far, we’ve discussed how the subscription service model makes car ownership easier for the customer. Good customer experiences are always good for the dealer, but the Care by Volvo model goes beyond that. Volvo leverages a digital retailing platform — the same kind of platform available to individual dealerships — towards customer retention.
What makes Volvo’s new program truly revolutionary is the same thing that makes it a true “subscription” service. At any time after the first 12 months, the customer has the option to upgrade to a new Volvo entirely. Your subscription doesn’t just include your next car – it includes the car after that. Your customers’ easiest and best option is to keep coming to you for all their next vehicles.
Things are changing for the better
Care by Volvo is just the first indication of a new approach to car ownership – and car sales. Many younger consumers aren’t as interested in the complicated headache of traditional car ownership, especially in the face of simpler alternatives. According to the
BBC, “the future is especially hazy [for carmakers], since car-sharing firms might step up their purchases, even if future households scale back.”
This highlights the true appeal and importance of subscription car services. Given the option between full ownership and car-share services, many younger drivers will choose the easier solution for its lack of commitment, expense, and complexity. There are no surprise maintenance expenses with a car-share.
Subscription car ownership is the perfect middle ground for consumers who want the perks of their very own car, without the drawbacks and headaches that plague the commitment of outright ownership. Of course, it would be a gross misrepresentation to suggest that younger generations will turn away from true ownership entirely. But a growing segment doesn’t have the patience for winter tire research and expensive maintenance schedules.
This is good news
This new middle ground between car-shares and traditional ownership will give an emerging market segment the incentive to subscribe to your dealership and enjoy a streamlined and stress-free relationship with their car, you, and your service department. And even if subscription cars are a little outside of your current capabilities, it’s easier than ever for any dealership to integrate an industry-leading digital retailing platform to offer the same sort of convenience and online ease of use.
We’re always talking about the drastic, monumental shifts in the car industry and the dealership landscape. Sometimes, all this disruption can sound intimidating. But the truth is, new technology and new ownership models can offer some of the most engaging and compelling reasons yet for customers to buy from your dealership.
Since 2011, Motoinsight has been working with dealerships and OEMs to realize a new vision for the automotive industry through our leading solutions including MotoCommerce. If you’re ready to find out how your dealership can thrive in the digital future, visit
motoinsight.com. Let’s redefine automotive retail, together.
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