Online car sales have been steadily increasing year over year. By 2026, online purchases will represent 15% of all sales – compared to just 2% in 2022. In five years, that number could reach as high as 40%. The truth is, the selling of cars online was inevitable once broadband became a reality. Yet online retailers have struggled to survive in a market that should be profitable. Despite the focus on inflation, soaring interest rates, and skeptical consumers, the crux of the matter lies in the overextension of the online business model. This overextension is primarily a result of inefficient operational and logistical processes, which are increasingly taking a toll on all auto retailers, whether the leaders at these dealerships know it or not. The fall of online retailers should be a wakeup call to auto retailers everywhere.
Customers don’t see it, but every car purchase is a logistical maze that many talented title clerks must navigate to ensure all aspects of the sale are finalized, including the vehicle acquisition, registration, titling and taxes paid on all vehicles. Typically, everything is settled within 30-45 days, and as long as that deadline is met, dealership leaders may never know the sweat and tears that went into the transaction. But when something inevitably goes wrong, customers are lost, and future revenue is jeopardized. For example, a notable online retailer’s licenses were recently temporarily suspended from several states, because they failed to deliver their customers’ titles on time. In one occurrence, it took 11 months to get the customer his title, all while he was required to make payments. Bricks and mortars are dealing with the same logistical nightmares but on a smaller scale, and they are becoming increasingly common as new and existing customers gravitate towards online purchases.
But there’s a better way, thanks to the recent emergence of digital titling, which is revolutionizing the way car dealers compete in the online sales market by streamlining and speeding up the process of transferring vehicle ownership. Retailers in the U.S. no longer have to wait up to 60 days for the official transfer of a vehicle title through the historically slow and convoluted paper-based system. The process can now be completed via the nation’s first National Digital Titling Clearinghouse (NDTC), offered by West Virginia and powered by Champ Titles and Tyler Technologies. A revolutionary step in vehicle titling, the NDTC reduces title turnaround times from up to 60 days to less than a day – not only improving operational efficiency and customer service for online sales, but for any type of dealer to dealer or dealer to customer sale.
Moreover, the benefits of digital titling go far beyond faster service and convenience. In today’s day and age, and especially with online sales, security is paramount and digital titling significantly reduces the risks for auto retailers. Far more secure than their paper counterparts, digital titles make it extremely difficult for impostors to tamper with or forge documents. This ensures that buyers are getting what they paid for, and sellers are protected from potential scams.
These breakthroughs come at a time when online vehicle sales are rising faster than ever before, and retailers are looking for a solution to the title turnaround problem that has been plaguing them for decades. Those who embrace this technological jump will experience streamlined and efficient titling processes that will not only reduce costs but attract a broader range of customers who prioritize convenience and speed in their car-buying experience.
Learn more about the digital titling capabilities offered to automotive retailers by the National Digital Titling Clearinghouse here.
