Comparison of Online and Offline Retail Environment of Car Industry

The offline retail environment of the automobile industry is that of manufacture to intermediary to consumer. The process from which the product (car) proceeds from manufacturer to consumer is that of through the automobile dealer. This intermediary batch purchases a number of models from the manufacturer and sells them from the ‘lot’ or storefront. This placement and presentation of the product has proved largely successful. The tangible product is viewed, test driven and purchased from the intermediary. An advantage of the offline retail environment is that of the face to face (F2F) transaction environment. The purchase of a car requires high involvement between the supplier and consumer and can be argued demands a customer relationship and it is contended that this enhanced interactivity empowers the consumer. (Pitta, Franzak& Fowler, 2006) Knowledgeable sales people could also enhance trust and along with an already established brand knowledge. A fervent argument in favour of a retail environment is; consumers of products of a higher expense i.e. cars, houses, furniture require time and attention from employees (Grewal, Baker, Levi & Voss, 2003) and it is argued that this value cannot be replicated or matched in an online environment.
One major weakness off the offline retail environment that E Business may have overcome is that of customisation. Previously, if a consumer wished to have a particular feature or option they would have to wait weeks or months for the particular specification to arrive, this is no longer the case as the consumer can purchase custom made products without having to wait for specified features. The online retail environment now offers many benefits both to the manufacturer and consumer. Web markets expand the choices available to buyers, give sellers access to new customers and reduce transaction costs. (Kaplan & Sawhney, 2000) The impact of B2C direct marketing is that manufacturing transaction costs are lowered and

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