Market Insight: What car buyers really want

PRESSURE on dealers to convert online leads into sales becomes all the more acute when the market is down, but buyers are making it abundantly clear they want to maintain control and handle all interactions with a dealership on their terms to ensure a hassle-free experience.

This is one of the take-outs from new research by online auto marketplace, Autotrader, which commissioned Sydney-based research firm FF2 to analyse how consumers want to connect with franchised dealers when buying, or intending to buy, a new or used vehicle.

The company also sought to understand consumer attitudes towards leaving contact details, and to rate the importance and effectiveness of ‘walk-ins’ versus traditional leads.

The national survey of 1000 consumers, made up of 511 buyers and 489 intenders, found the vast majority (88 and 91 per cent respectively) rated visiting a dealership as the most important method of contact when searching for a car, while phone, email, text and webchat were further down the scale.

These other forms of communications were still considered to be important tools for prospective buyers and retailers to interact, and the study found that younger consumers in particular (those aged 20 to 44) clearly preferred to have a variety of options for getting in contact with a dealership.

Indeed, 74 per cent of young intenders had a strong preference (60-70 per cent) for a wide range of contact methods.

But with this in mind, the survey also found an overwhelming preference by both groups (86 per cent combined) for choosing when and where they give their contact details rather than being forced to do so, the latter often required in return for accessing a dealer’s location and information.

A substantial 72 per cent also agreed or strongly agreed with the statement that they will worry that, if having provided their personal contact details before visiting the showroom, the dealership will keep hassling them.

A similar percentage of respondents (74 per cent) also showed a strong preference for dropping in unannounced when first visiting a dealer, rather than giving out their contact details before stepping into the showroom.

Autotrader notes that with so many buyers and intenders reluctant to give out their personal details, dealerships should consider how best to communicate with them, and points to the survey results showing that “catering to this preference for walk-ins doesn’t just make potential customers happier, it increases the chances of converting leads into sales”.

The survey found that 63 per cent of buyers made their purchase after dropping in unannounced, compared to 37 per cent who had given their details first.

And according to Autotrader, “these figures take on even more significance when you consider that walk-ins account for 34 per cent of all sales conversions, as compared to only 17 per cent for previous phone or email leads”.

The survey results make for interesting reading in a variety of other contexts. Among them, the buyer group visited 2.6 dealers on average – or 1.9 for those who made first contact with an unannounced walk-in – while intenders similarly said they expected to visit multiple dealerships (3.5 on average).

The motivations behind the unannounced visit were primarily to see the vehicle up close (‘touch and feel’) – 94 per cent combined buyer/intender – while other reasons included taking it for a test drive (84.5 per cent), to talk about price and potentially buy (83 per cent), getting closer to buying after doing the research (81 per cent), helping decide which make/model was best for them (80 per cent) and to talk to someone knowledgeable (75 per cent).

In terms of attitudes toward dealerships, almost half of those surveyed (47 per cent) said they thought customer services were improving, with only 11 per cent thinking the opposite, while the general feeling towards car dealerships delivered a 52 per cent net positive return compared to 11 per cent negative (the remainder neutral).

When researching to buy a car, more than half (56 per cent) said they did not know, or were not sure, which brand they were going to buy, while seven out of 10 intenders (69 per cent) were similarly undecided.

The motivations to buy a new car (rather than used) were, in order of weighting, the factory warranty on offer, higher confidence in quality and greater trust in a new vehicle, followed by updated technology and features, preference for the ‘new car feeling’ and the great deals now available on new cars.

Rounding out the major reasons were relative affordability and getting better value versus used.

The research activities undertaken among the buyer group were biased toward visiting dealerships, with 53 per cent rating this as very important, although contacting dealerships by other means was much lower at 27 per cent.

Internet research was a close second on 50 per cent, while the other major activities were reading articles/reviews (37 per cent), thinking about previous cars (34 per cent), advice from a mechanic/expert (28 per cent) and talking to friends and family (25 per cent).

For the intenders, internet research was the main form of research undertaken (90 per cent), followed by talking to family and friends (77 per cent), reading articles/reviews (74 per cent) and considering the experience with previous cars (76 per cent).

Visiting dealerships in this case was only done 48 per cent of the time, while contacting dealerships came in at 31 per cent.

The survey sample of 1000 responders was drawn from all states and territories and was slightly skewed towards males (60%) and younger/middle-age demographics – 20-34 (37%) and 35-54 (46%).

As Autotrader points out, the survey results reinforce the ‘open’ model used by the company that allows customers to immediately access a dealer’s location and contact information.