Republished from Auto Success
E-commerce is the future for auto dealers. A 2023 McKinsey survey found that a third of buyers want to purchase their next vehicle online, citing "speed" and "simplicity" as major factors. Yet, making online retail into a reality has remained a challenge for auto dealers. In 2022, online car sales accounted for just two percent of total sales. While that number is expected to grow to as high as 40% in the next five years, dealers continue to struggle with creating the quick and seamless experience that customers expect, putting both customers and revenue at risk. In the automotive supply chain, ongoing shortages create unpredictable delays for manufacturers and make it difficult for dealers to receive inventory. In such an unpredictable environment, dealers must focus on simplifying every step of the sale and delivery process. That starts with a fundamental but easy-to-overlook task: vehicle titling.
Handling vehicle titles has long been a tedious and time-consuming task for automotive dealers. Vehicle titles remain one of the few legal documents anywhere still reliant on paper, requiring dealers to invest significant time and resources into manually matching paper titles with consumers and their vehicles and forcing customers to exist where they do not want to be - offline. In addition, dealers face delays as they wait for title clerks to process and finalize every aspect of a sale: vehicle acquisition, registration, titling, and taxes paid. Typically, the title transfer process can take about 45 days and is reliant on mail or courier services. In worst-case scenarios, that process can take far longer: news reports have highlighted instances where some online retailers took nearly a year to get a title to a customer. Such long waits and heavy reliance on a paper-based system are difficult for traditional rooftop dealerships and completely prohibitive if dealers want to build up a successful e-commerce operation.
Fortunately, the recent emergence of digital titling has the potential to revolutionize the way car dealers compete in the online sales market. By converting vehicle titles from paper to a completely electronic format, digital titling can accelerate the auto sales title and registration process.
As the CEO of CHAMP Titles, one of the country's leading digital titling companies, I've witnessed firsthand just how much digital titles can improve this process. We partnered with the state of West Virginia to develop the first National Digital Titling Clearinghouse (NDTC), which centralizes vehicle titling, enabling any dealer, as well as fleet operators, lenders, insurance carriers, and the service providers for each, to transfer titles digitally across the nation. This innovation slashes processing times from 45 days to less than a day. That’s speed redefined! With a few small changesto a dealer’s title processing workflow, drastic time savings and truly online sales become an efficient reality today for dealers nationwide.
In addition to efficiency gains, digital titling enhances security for dealers' online systems. Manual data entry and physical document handling can be key points of failure in the titling process. Traditional, paper-based titling systems are also inherently susceptible to fraud, particularly with used vehicles. Digital titles mitigate these vulnerabilities by ensuring that all information is verified, law compliant, and then stored in a secure, tamper-proof digital format.
CHAMP's technology, for example, leverages advanced encryption and a multi-layered security framework to protect data at every stage of the transaction. It also allows users to access a comprehensive and transparent record of a vehicle's history, including liens, transfers, or alterations. This helps dealers to cut down on manual verification and provides customers with a reliable, trustworthy purchasing process. Without the need to review and move physical titles, dealers can also redirect their human resources towards more impactful and value-driven projects.
Digital titling also enhances customer satisfaction by meeting today’s fast-paced, tech-driven demands. Consumers expect a seamless, end-to-end transaction experience, whether they are buying shoes or a new car. Lengthy delays in title processing and vehicle delivery not only frustrate customers but also risk damaging a dealer’s reputation. By adopting digital titling, dealers can drastically reduce the time between purchase and vehicle delivery, offering a far more streamlined and satisfying experience. How is that for simple? This can help dealers differentiate themselves from competitors still reliant on outdated processes.
Moreover, as environmental concerns continue to grow, digital titling aligns with broader sustainability goals. Eliminating millions of paper documents and miles driven to and from DMV’s each year, both of which materially helps lower environmental impact and allows dealerships to showcase their commitment to greener practices. This appeals to eco-conscious customers but can also improve operational efficiency across the entire automotive sales process, making it a win-win for all involved.
In short, as the auto retail industry increasingly moves toward e-commerce, addressing the complexities of the vehicle titling process is crucial. Digital titling does just that by streamlining a traditionally cumbersome task and offering meaningful cost and security advantages that will help dealers compete in the evolving online marketplace. By embracing digital solutions, dealerships can reduce inefficiencies, enhance customer trust, and ultimately deliver the “speed” and “simplicity” that buyers, both online and offline, now demand.
