The way people buy cars has changed over the last few years. The change, has been aided largely by technology which has revolutionized how people buy cars. Back then, people would spend huge amounts of time trawling through different car dealerships for a sale. Now it is even possible to import vehicles and have them delivered to your doorstep saving you the hustle, and gives you the assurance and peace of mind during the importation process. To help us understand the latest car buying trend in Kenya and across the continent, EABTs Tullah Stephen, sat down with Michael Mureithi, the CEO of Kenyan online car classifieds Cheki.co.ke
Michael, how would you describe the auto dealership in Kenya currently?
So far so good. We are seeing the industry recover from last year’s fall when the country was going through an economic slowdown. This year, the industry projects that sales will go up slightly by two percent compared to last year.
Let talks about online vehicle sales. Cheki is among the pioneers in this industry how has it been for you as business?
We have retained our market leading position despite the market recording an increase in the number of online car classifieds setting shop. Our listings continue to grow, we connect over 20,000 buyers and sellers every month. We have done this through continued innovation of our services in the aggressive business world. For us every advantage counts.
What percentage of consumers want the ability to purchase their vehicle online and how do you know?
I can say many Kenyans want to purchase their car online for the convenience it avails them. They have more variety and customisation to their needs. We have seen this especially from our platform as the numbers grow.
What are Kenyans looking for in a car from your opinion?
From our understanding, Kenyans want two things: high quality cars at a great price. If you are able to unlock that, then you have won their hearts and wallets too.
How many vehicles has Cheki imported for customers so far since introducing this service?
This is confidential…(chuckles)… However, we are happy with the results thus far
Let’s switch and talk about dealers for a moment. What do you look for in a dealership to ensure that offering online checkout is a good direction for them?
For us, we ensure the dealer must have the following: A wide variety of cars that are reasonably priced, good quality and a good reputation. We check for the details of the directors to especially verify on their reputation.
How are dealers handling the trade-in and financing aspects of the sale when conducted online? What is the customer experience like?
With regards to trade-ins, the car has to physically be evaluated by the dealer – an online quotation can be provided but this has to be reconfirmed based on the physical valuation of the car’s condition. The customer experience thus in Kenya needs to get better, better technology needs to be incorporated in the process to help with this. At cheki.co.ke we are working on this.
From your experience, what are some of obstacles and challenges dealers experience when offering customers, the option to conduct their purchase online?
I believe its giving the customer a wider variety of cars – not all of us like a white, black or grey Toyota fielders, some of us want a gold one. The other challenge is better financing options to purchase a car.
Most Buyers don’t have a clue of how to buy a car in the internet age. What are some of the top of mind tips you can give to people looking to buy cars online?
Couple of things to note as buyer: identify why you want a car? Is it for business, personal commute, status symbol, to drop of the kids to school? This will help you select the right car for your needs. Secondly, research on variety in the market perhaps on cheki.co.ke. Third, compare the quality of the car, that is, the make, model, year of manufacture, mileage, condition of the car and their respective prices. Once you’ve selected the car, have the car inspected and serviced and finally ensure that you pay only to a trusted seller.
You have mentioned the word trust more often in this interview. Why?
It is a fact that in this business or any other online business, consumers rate trust more than the cost.
Recently, Cheki introduced new service, ChekiPort that allows consumers to import vehicles. Why and how did the idea to offer customers the chance to import cars online came about?
Car buyers are increasingly importing directly from overseas dealers over the past couple of years. This was driven by the need to get better prices in addition to having cars customized to their needs. However, importing a car is quite challenging for example, selecting the right car, selecting a trustworthy dealer, negotiating for the right price and sending money to a foreign bank account. ChekiPort comes in to create a trusted seamless end to end car importation process for car buyers.
So how does ChekiPort work?
First, consumers identify the car of their choice by visiting Cheki and clicking on the ChekiPort Imports banner. If you wish to finance the car over a certain period of time, you have the option of getting a Car Loan through Cheki. Cash buyers will, however, need to make the full payment. ChekiPort will then proceed to purchase the desired car for you. It will then undergo the mandatory quality inspection as required by Kenya Bureau of Standards. Once the car has undergone all the necessary checks, it will be loaded on a ship and will take on average of six to eight weeks to arrive in Mombasa. Once the car is in the country, ChekiPort will proceed to clear the vehicle on consumers’ behalf.
Most car buyers prefer to get value from test-driving. How does the car importation business enable this experience? Is this a possible challenge?
As car buyers, we test drive cars because we want to be sure of the quality of the cars we are buying. ChekiPort focuses only on high quality cars at a great price, this is the trust we have built in the market. Think of it like this…when you buy a loaf of bread from a supermarket you don’t taste it first before you purchase it, you trust the retailer to sell you high quality bread.
Do you think that ride-sharing services have had any impact on the way people think about cars, car ownership and transportation in general? What’s your view?
Yes, it has. Millennials are starting to question the need to have a personal car and are starting to opt to buy cars for business such as ride-sharing or car hire. Generation Xs and Ys still believe owning a car as a means to define their personal/career success thus are still buying cars at a high rate.
What is one on-point message you’d like the industry to know around the idea of consumers conducting their vehicle purchase online?
It is simple, better variety of cars at a great price and from trusted sellers.
Looking at the next three to five years, what do you see the greatest challenges being? What about the opportunities?
Greatest opportunities lies in the spare parts or mechanics integration. Other opportunities could also be in car financing, car leasing or rentals. The greatest challenge I think will be in having the right capacity or resources to do this.