Biggest dealership myths busted

Flying pig

The automotive sector is undergoing a period of change as fast and profound as in any other industry sector. As transformative forces create waves of disruption, is it any surprise that a few misconceptions trail in their wake?

Let’s look at some of these myths and thoroughly debunk those that deserve it most.

Time’s up for sales staff

Changing consumer expectations mean dealerships need to ditch traditional car-selling methods in favour of a hybrid online/offline method.

But that doesn’t mean car buyers want to do away with in-person interactions altogether. According to consulting firm Deloitte’s 2021 Global Automotive Consumer Study, 79 per cent of Australians would prefer to purchase their next vehicle at a dealership (second only to Japan, which registered 80 per cent)1.

Car buyers want the convenience of conducting research online. But they still want to validate that information by speaking with a subject matter expert, not to mention experiencing the sight, smell and touch of the vehicle they’re interested in.

When asked what brings them to visit a dealership, 83 per cent of Australians surveyed stated that they wanted to see the vehicle before buying it, while 68 per cent said they wanted to take it for a test drive1.

Insurance is low value to OEMs and dealerships

It’s easy to feel the impact of the past few years with insurance providers revising and improving their offerings to respond to market and regulatory changes at a rapid pace. As a Dealership, it can be frustrating to keep up with the change in market and question whether insurance is here for the long haul. But don’t lose sight of the big picture.

The role of insurance at a Dealership can be a win-win for you, and for our customers. Offering quality insurance Motor Insurance products at dealership can be a massive convenience for our customers – but it also helps insurers and dealers work closely on much more than just the new business sale.

Claims Management programs are now, more than ever, embedded in the Automotive industry. Whether it’s buying replacement parts or vehicles or helping customers find and choose expert dealer repairers in a time of need, Allianz is committed to working with the industry across a range of services.

Plus, Allianz works with dealerships to build their reputation via marketing efforts – a positive customer experience across with your insurance providers can make a customer for life.

Lowest prices drive customer decisions

Okay, we understand why you might think the jury is still out on this one. Even a report on the ‘dealer journey’ commissioned by Allianz concluded that 56 per cent of customers nominate price as their primary choice driver2.

But it’s worth digging a little deeper into why this might be the case. Afterall, it’s possible to find contrary evidence that states that customers’ dealership experiences can trump low prices when it comes to car-buying motivation (see this Autotrader study3).

When it comes to making ancillary purchases for their vehicle, such as comprehensive insurance, customers who focus on price as the sole measure of value might not understand the additional value offered to them. The research from Allianz found that customers often assume all insurance is the same, or similar – and many aren’t confident about what their insurance covers! If customers are looking for differences in products available on the market, it’s easy to understand why they might start with price2.

When a product may be perceived to be expensive, it’s worth asking the question: do they offer additional value through superior product benefits such Choice of Repairer or New of Old Replacement?


This article has been prepared by Allianz Australia Insurance Limited ABN 15 000 122 850 AFSL234708 (“Allianz”). Information contained in this article is accurate as at August 2021 and may be subject to change. In some cases information has been provided to us by third parties and while that information is believed to be accurate and reliable, its accuracy is not guaranteed in any way. Any opinions expressed constitute our views at the time of the issue and are subject to change. Neither Allianz, nor its employees or directors give any warranty of accuracy or accept responsibility for any loss or liability incurred by you in respect of any error, omission or misrepresentation in this article.


1 https://www2.deloitte.com/au/en/pages/consumer-industrial-products/articles/global-automotive-consumer-study.html
2 The statistics provided here are sourced from an Allianz survey conducted in 2020 on customers’ car-buying journeys and their experience of purchasing insurance. (Sample size – Qualitative: 21 in-depth interviews conducted / Quantitative: 4000+ survey responses.)
3 http://press.autotrader.com/2015-03-31-New-Autotrader-Study-Consumers-Want-Big-Changes-to-the-Car-Buying-Process