In the competitive market for luxury cars, brands are
continuously experimenting with new ways to reach their target customers. Tesla
(TSLA) and Cadillac are the latest automakers to rethink how cars are sold.

Tesla has a vastly different retail structure than other
manufacturers; It is the only one that sells directly to consumers, shunning
franchised dealers in favor of company-owned showrooms where visitors can test
drive a car and place an order. Now Tesla is pushing the envelope a little
more. Shoppers at The Grove, a ritzy mall in Los Angeles, can gaze at a Model X
parked inside Nordstrom (JWN)—just past the men’s suits.

Last week, the electric car maker officially opened a
gallery within Nordstrom, bringing the brand’s new crossover right to its
target customers where they shop. The boutique-style showroom, with just 400
square feet of floor space, is the first of its kind for Tesla. The automaker
has staffed the gallery with product specialists, and interactive displays
allow shoppers to explore interior and trim options. Test drives are available
in the mall’s parking lot.

“Tesla places stores and galleries in high foot traffic
retail venues like malls and shopping centers, allowing potential customers to
learn about our cars in a low-pressure environment when they’re not thinking
about buying a car,” a Tesla spokesperson said. “Our technology is different,
our car is different, and, as a result, our stores are intentionally
different.”

Tesla declined to say if there are plans to open more
galleries similar to the one in Nordstrom.

Matt DeLorenzo, managing editor for Kelley Blue Book’s
KBB.com, said automakers such as Tesla want to meld the car-shopping experience
with their customers’ lifestyles. At the swanky events of Monterey Car Week,
for instance, the likes of Ferrari and Bentley fight for the attention of car
enthusiasts.

“What they’re saying is, it’s not just a car but a luxury
good,” DeLorenzo said. “As in the case of Lexus, Infiniti and European makes,
they’re trying to transform dealerships into more of a luxury retail store, as
opposed to a traditional dealership with cars out in the lot and florescent
lights inside.”

That’s exactly what Cadillac has in mind. With roughly 900
dealerships across the U.S., Cadillac has far more locations than its German
competitors, and executives want to transform a portion of those dealerships
into showrooms equipped with virtual-reality headsets. The technology would
allow customers to explore new Cadillacs without getting behind the wheel.

Cadillac is seeking commitments from dealers, particularly
low-volume sellers, who are willing to empty their lots and go high-tech.
Virtual dealerships would continue to run service centers and offer cars for
test drives.

The plan emerged from Project Pinnacle, a new incentive
program for dealers that establishes standards for customer service and sales.
Johan de Nysschen, the former Infiniti chief who was put in charge of Cadillac
in 2014, has spearheaded Project Pinnacle in hopes of revamping the retail
experience.

“Cadillac is trying to change perceptions about the brand.
It wants to be a top-end player, not just a premium domestic brand,” DeLorenzo
said.

Cadillac is on a larger mission to remake its image. De
Nysschen moved Cadillac’s home from Detroit to New York City, saying at the
time that Cadillac would benefit from living in a large market for luxury cars.
In early June, the company opened a showroom and coffee shop, Cadillac House,
on the ground floor of its Manhattan headquarters. The space will host vehicle
displays, art exhibits and special events, extending the Cadillac brand outside
the automotive world.

The moves to revitalize the brand’s cachet coincide with
the rollout of two key vehicles: the CT6, Cadillac’s flagship sedan, and the
XT5, a crossover that replaces the SRX. Cadillac sold close to 59,000 vehicles
in the U.S. during the first five months of the year, about half the number of
cars moved by Lexus, BMW and Mercedes-Benz.

Tesla and Cadillac aren’t alone in their efforts to reshape
the sales process. Toyota’s (TM) Lexus is testing a no-haggle pricing strategy
at 11 dealerships that volunteered to participate in a pilot program. Lincoln,
the Ford (F)-owned luxury brand, said it will offer a pickup and drop-off
service for owners of the new Continental sedan, replicating similar dealership
programs at BMW.

Given the close competition among luxury brands, concierge
services and other perks can be the deciding factor for buyers.

“At the top end, there’s not much haggling. Customers know
what they want, and they’re willing to pay for it. The question is which
manufacturer is going to step up and offer you that extra human touch, if you
will,” DeLorenzo said.