Study Says Future of Car Selling is Online

By 2020, as many as 70% of new-car sales lead will come through Web sites, smart phone apps and social media, Frost & Sullivan predicts.

The market research firm says digital retailing will be especially important in attracting Generation Y consumers those born between 1977 and 1994 who respond better to targeted digital marketing than traditional techniques.

Frost & Sullivan notes that Audi is experimenting now with a digital showroom in London where visitors can manipulate large touch screens to configure vehicles and option packages.

The firm forecasts that carmakers will open more than 100 such showrooms or lifestyle emporiums by 2016 that associate their vehicles with fashion, music, design, art and technology. Its new study, The Advent of Digital Retailing and its Impact on Car Dealership Structures, estimates that European and U.S. carmakers will invest as much as $5 billion in updating dealership technology, including digital tools.