Announcing a major shift in its retail strategy for our market, Mercedes-Benz India has unveiled its new ‘Retail of the Future’ (ROTF) direct-to-consumer (D2C) sales model, which is set to be implemented from October 2021, that aims to increase transparency between the luxury carmaker and its customers, as well as aid Mercedes-Benz's dealers/franchise partners.
Under D2C business model, Mercedes-Benz India will own the entire centralized vehicle stock and will directly invoice a purchase to the buyer, in addition to handling order processing and fulfilment.
The most notable change for the customers, under D2C model, will be that they will be purchasing the car from Mercedes-Benz, which means their cars will be invoiced directly from the carmaker and not the dealers. This will also mean that all customers across India, will be offered the same prices, negating the need to negotiate with dealers to match one another's prices.
Under D2C business model, Mercedes-Benz India will own the entire centralized vehicle stock and will directly invoice a purchase to the buyer, in addition to handling order processing and fulfilment.
The most notable change for the customers, under D2C model, will be that they will be purchasing the car from Mercedes-Benz, which means their cars will be invoiced directly from the carmaker and not the dealers. This will also mean that all customers across India, will be offered the same prices, negating the need to negotiate with dealers to match one another's prices.
For the dealers, this new sales model will only be applicable to the sale of new cars and will not change the functioning of the other sections of the business, such as customer services, pre-owned cars and accessories business.
Dealers will continue to be the point of contact for customers as they will facilitate the purchase, the benefit for them will be that they own no inventory under this business model, and hence benefit from a lower cost structure and carry little market-facing risk. They will be directly compensated by Mercedes-Benz India for vehicle sales, and will continue to develop local market requirements, retail marketing activities, lead generation and manage customer relationships. There will be no change to existing dealer infrastructure.
With Mercedes-Benz India making the entire pool of cars in stock available to buyers, prospective customers will benefit from a single price for every model across the country, and also have a wider variety of models and specifications to choose from, as they won’t be bound by the options available at a particular dealership.
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