About five years ago, Ifeoluwa Ajiboye, chief executive officer, Da-Ande Autos, relied on building friendships at social centres including parties, clubs and restaurants to expand his customer base and drive sales.
“We talked to friends, printed complementary cards and visited relaxation places with the aim of selling,” says Ajiboye, whose Da-Ande Autos deals in imported second-hand vehicles.
But with the realisation that walk-in-customers have moved online, Ajiboye started embracing marketing offerings from the likes of Cheki Nigeria, Affordable Cars Limited, Jiji, OLX, among others.
The increasing digital awareness among young Nigerians in recent times has birthed online vehicle marketing platforms and car dealers like Ajiboye are cashing in on them.
Dealers in second-hand vehicles like Ajiboye say, contrary to the belief that the presence of online vehicle marketing platforms is threatening their survival, the platforms are actually giving visibility to their products. The online platforms have significantly pushed up car sales at a time customers connected to the internet prefer to shop from the comfort of their homes.
“When online stores sell cars, they sell for places like ours,” Ajiboye says. “The reason is dynamism, which is you change as time changes to blend with technology. In other words, you hardly find people walking into car outlets themselves.”
BusinessDay findings show that most conventional dealers have contractual relationship with online platforms to promote their products far beyond the physical outlets. The outcome is that potential buyers are directly linked with the sellers, who afterwards meet for final bargaining and inspection.
“That is why we contract and pay Jiji and Cheki. They snap our products, get our prices, get details and help us sell. A lot of people get too busy these days to walk around and start looking for cars,” he says.
Before efritin.com shut down operations in 2017, Ogunleye Korede, a manager at Eminent Motors in Ikeja, Lagos, paid N24,000 for a three-month subscription with the online platform which, he said, really boosted his sales. The market linkage compared to old times became broader.
“There was a day I sold five cars in a day, and two of those customers came from efritin.com. Sales are best in December,” Korede said.
All attempts to get a response from Cars45 proved abortive as at press time. A female customer service officer at Cars45 referred our reporter to another staff named Peter. When contacted, Peter asked our reporter to send a mail, but BusinessDay was yet to get a reply to the mail as at the time of filing in this report on Monday.
Sola Adeyanju, customer care officer at one of the online platforms, noted that there has been a surge in the number of requests for inspection through the platform he works.
“Initially, Nigerians were a bit sceptical about most online platforms, but the trust is gradually picking up,” Adeyanju said.
However, since vehicles are not mundane purchases such as consumables, losses accrue to dealers when months pass without a single sale. Yet, subscription has to go on to target customers.
But beyond the promotions, price competitiveness is a problem that dealers have to deal with and Ajiboye of Da-Ande Autos says the cost of clearing vehicles in Nigeria impacts negatively on end cost. Prices, he says, are not only a function of cost of buying or shipping from the United States, for instance, but also of amount spent during clearing at the ports.
“For instance, you could clear a 2006 Highlander for about N600,000. If you add that to the amount you buy and pay for shipping, the cost will be high, and for a businessman who wants to survive, you wouldn’t sell for the same amount you bought,” Ajiboye says.
But despite the growing ubiquity of online platforms, Michelle Evans, global head of digital consumer research at Euromonitor International, says in a report that brick-and-mortar outlets will continue to play a critical part in the value chain, both in terms of brand engagement or purchase execution. These outlets will continue to play a role going into 2040, though their functions will evolve with internet connectivity impacting how customers conduct commerce, Evans says in the report tagged ‘Commerce 2040’.
Owing to the level of convenience, simplicity and knowledge provided by connectivity, shoppers are more impatient, demanding and informed. Technological advances are increasingly detaching the purchase decision from a physical outlet, making it necessary for smart retailers to leverage technology to remove the hassles of shopping for purchases.
By 2040, stores will exist to sell impulse purchases and irregularly purchased convenience goods while technology, like wearables and voice, will guide consumers throughout such stores. Products will automatically be added to a virtual shopping cart upon selection, while robots will be leveraged for customer service and inventory management, Evans says.
Also, the future will have experiential centres built around products requiring more consideration. Some retailers and brands may charge entry to consumers for certain experiences, tailoring the experience based on the consumer’s interest. Consumers will be able to test product claims or try a product in context of its final usage.
From the gauge of their involvement, Nigerian dealers are getting ready for that future.
TEMITAYO AYETOTO & OLUFIKAYO OWOEYE
