Disrupting the Industry, the Future: Vroom
Friday, September 18, 2015
Many consumers see buying a car as an exhausting, stressful experience—even more so if they’re looking for used cars. Rather than the neat, shining rows of pristine vehicles customers see on new car lots, used car dealers showcase a collection of vehicles in all makes and models, and in various states of repair.Used car-buying tradition dictates that if a customer wants to buy a used vehicle, they have to prepare themselves for a grueling shopping experience. Multiple car lots, multiple test drives, probably even multiple days.One company seeks to change all that.A company called Vroom is looking to be the “Amazon.com of used cars” (Forbes 2015). They’re taking the used car business online, banning price negotiations, and delivering vehicles all across the country.Right now, Vroom is only just getting started. Let’s take a look at where they want to go.The State of the IndustryVroom CEO Allon Bloch has been quoted as saying, “People love cars, they just hate buying cars,” (Entrepreneur 2015).That sentiment makes sense, considering the rigmarole customers have to go through to purchase a used vehicle. Any used-car shopper knows the unique pain of sorting through multiple vehicles and choosing the one they hope will work properly. And that’s not even getting into the hassle of arranging an inspection, negotiating a fair price, and worrying about problems after the purchase.Fortunately, the internet has made the used car buying process a little easier. Customers can look up vehicles and research prices online before they make a trip to a sales lot. But even if the initial shopping is simpler, buying a used car is still a time-consuming ordeal.Vroom’s Ideas for ChangeVroom refuses to be satisfied with anything less than radical simplicity. They famously want to make buying a used car as easy as buying a pair of shoes. Any customer who loves the convenience of making purchases on Amazon.com will find it just as simple to purchase their next truck, car, or SUV on Vroom.How does Vroom propose to make a traditionally difficult process so easy? They want to turn the system upside down with ease, transparency, and these five things:1) Home pickup/delivery. Just like other packages are delivered to customers’ doorsteps, their new-to-them car will be too. Right now, Vroom relies on a third party for vehicle shipment. But the company plans to change that.Soon, the delivery person will double as a representative from the company. Vroom will employ their own associates to pick up and drop off vehicles, and lead customers through the sale or purchase process.2) No haggling. Price negotiations are only fun for customers who like negotiating, i.e. almost no one. Vroom plans to set one price and leave it at that. Customers will enter their zip codes to get exact costs for taxes, title and license fees, and Vroom offers financing options through partnerships with over 30 banks.3) Quick delivery. Think doorstep (or rather, driveway,) delivery isn’t enough? How about having it done within 48 hours? Right now, Vroom delivers cars to customers within 48 hours of purchase. As the company progresses, they aim to cut delivery time down to 24 hours.4) Like-new used cars. Vroom painstakingly reconditions each used vehicle themselves to meticulous standards. They want to provide their customers with used cars that will look and drive like new.5) Money-back guarantee. People generally associate money-back guarantees with small consumer products and As Seen on TV gimmicks. But Vroom understands customers might be wary of purchasing a used vehicle online, so they’re extending the promise to vehicles.If customers don’t like the car they bought, they can return it for free within 7 days.What Vroom Means for Used Car-BuyingRight now, Vroom is still just a startup. They have essentially been operating in beta status, and only for the last two years. But if Vroom succeeds, they will seriously disrupt a fractured industry that hasn’t changed much in decades. And it looks like they just might do that.As of July 2015, Vroom had raised $54 million in Series B funding. They plan to use the funds to buy more reconditioning facilities (their only one right now is in Texas,) and promote their business. If all goes well, Vroom will be well on their way.What We Can LearnMost of what Vroom aims to do to the used car market remains to be seen. However, just the initiative illustrates how important online shopping is to modern day consumers.Millennials aren’t the only ones who expect ultimate purchase convenience anymore. Young and old customers alike want everything available on the web at the click of a button—and that includes vehicles.