When used car dealer CarMax opened in 1993, the internet had not yet become a near-universal resource, and people certainly weren’t buying cars online. They were a “big box” dealer that focused on their brick-and-mortar lots.
Since 2015, however, CarMax has invested much more heavily in technology to improve the “omnichannel experience for the consumer.” The goal was to “empower savvy car buyers to find, buy, and finance a car all online and have it delivered to their home” and “to continue to offer customers a satisfying on-site traditional shopping experience.”
Of course, CarMax had no idea at the time that a global pandemic was on the horizon. But by getting ahead of the shift toward online car sales, they were much more prepared for the challenges presented by COVID-19. Had they remained focused on their traditional lots and not made the tech investment they did, it could have been a different story.
CarMax now competes with companies like Carvana and Vroom (both of which were founded in 2013 and focus solely on online sales), and the pandemic “put U.S. online car sellers on the map.” It now seems clear that online sales will stick around long after the pandemic, and dealers that want to remain relevant will need to be strong in this area.
The lesson from the CarMax story is that it’s never a bad time to innovate and evolve your business — and you can quite possibly address future problems you’re not even aware of yet. They didn’t know that 2020 would be full of restrictions on public gatherings and that people would be doing so much from their homes, but they did think that a shift toward online sales could help their business in the long run. And they were right.
At the Bay Area Mobility Management annual conference next month, I’ll be participating in a panel discussion about building a “future-ready” mobility program. To me, a future-ready program is one that is well prepared for whatever comes its way. This includes having a positive attitude toward change and new technologies. In other words, if your program started as a brick-and-mortar used car lot, you need to be willing to become an online vehicle marketplace.
CarMax’s omnichannel experience met these goals and more, and was rolled out to the majority of the company’s customers before the COVID-19 pandemic. In light of the pandemic, CarMax reprioritized and accelerated the timeline. The company completed the nationwide rollout last August, giving CarMax the ability to address car shoppers’ needs for convenience and safety.