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User Trends: An Automotive Market Snapshot

User Trends: An Automotive Market Snapshot Chuck Moran

Automotive consumers continue to turn to the internet to research their upcoming vehicle purchase. This includes watching automotive videos online, which is not only effective at impacting brand consideration but brand image as well. These findings are part of an April 2007 Burst study of more than 5,700 online respondents 18 years and older who visit content websites.


The study found that 1 in 12 respondents (8.1 percent) will purchase or lease an automobile in the next six months. The study also found that fifteen percent of consumers feel the rise in gasoline prices has impacted their decision to purchase or lease an automobile; this impact is being felt by both in-market and out-of-market segments.


Among in-market respondents:



  • 10.4 percent postponed a purchase they would have made sooner

  • One-fifth (21.1 percent) accelerated their purchase/lease plans. 

Among out-of-market respondents:



  • 1 in 10 (9.8 percent) have postponed their plans to purchase or lease a new automobile.

An analysis of in-market respondents -- those who plan to purchase or lease an for an automobile in the next six months -- reveals both expected and surprising results:


New cars rule, and gas prices impact choice
More than one-half (55.6 percent) of in-market respondents plan to purchase or lease a new automobile, 31.0 percent will purchase or lease a used vehicle and 13.4 percent are undecided. As might be expected, the strongest new car market is among older respondents. In fact, nearly two-thirds (65.0 percent) of respondents 55 years and older plan to purchase or lease a new automobile, compared to 55.7 percent of respondents 35 to 54 years and 50.3 percent of respondents 18 to 34 years.


As we found with , escalating gasoline prices continue to impact in-market consumers' choices of vehicles. In fact, nearly two-thirds (63.8 percent) of respondents say gasoline prices are influencing the types of vehicles they will consider purchasing or leasing. This impact is being seen among all income segments, including the 53.2 percent of respondents who reported a household income (HHI) of $100,000 or more.



Table 1:  Burst Media Research, April 2007
N= 480 respondents


Internet is essential for research, especially for pricing
More than seven out of ten (71.9 percent) in-market respondents say they will use the internet to research automobile models they might purchase or lease. Both men and women go online to research automobile models (75.8 percent and 64.9 percent, respectively). It is only among respondents 65 years and older that fewer that two-thirds say they will use the internet for vehicle research; however, even among this senior segment, fully one-half (51.6 percent) will turn to the internet to assist in their automobile research.


Consumers indicated they will use the internet to gather many different types of vehicle information, and pricing information was reported as being the most popular use (52.9 percent). Other popular types of information consumers will seek out on the web includes fuel economy (43.4 percent), performance information (43.0 percent), model specifications (40.3 percent), safety information (39.9 percent), interior and exterior pictures (39.9 percent) and interior features (38.0 percent). Men and women seek many of the same types of information online; however, the one significant area of difference is vehicle safety. Women are significantly more likely than men to seek out safety information (45.4 percent vs. 36.9 percent) and crash test ratings (36.2 percent vs. 24.5 percent).


Given the variety of automotive information available online, it is easy to see why 25.2 percent of in-market respondents cite independent websites as the best source of information about models they might consider purchasing or leasing. These sites are far more important to car shoppers than automobile company websites (10.7 percent), as well as friends and family (10.9 percent), local auto dealerships (9.6 percent), magazines (7.4 percent), television (6.5 percent), radio (4.8 percent), local newspapers (4.8 percent) and national newspapers (4.3 percent).


Consumers give mixed reviews to online automotive ads
From rich media placements to streaming video, the Internet provides a wealth of creative options; however, only 18.2 percent of in-market respondents perceive online automotive creative as "cutting edge." For the majority (53.1 percent), online automotive creative is no different from what is seen on television or in print. Additionally, one in five (22.0 percent) in-market respondents say online automotive creative is better than what is seen in other media, but not cutting edge; and 6.7 percent say it is worse.


Online video is popular... and effective
One-third (37.6 percent) of in-market respondents say they have watched an online video featuring an automobile they might purchase or lease. The likelihood of having watched an online automotive video increases with household income; increasing from 26.4 percent among respondents reporting HHI of less than $35,000, to 38.5 percent for the $35,000-$74,999 HHI segment, and 38.1 percent for HHI segment $75,000 -$99,999, and finally 45.2 percent among respondents reporting HHI of $100,000 or more. Additionally, at least one-third of all age segments say they have watched an online automotive video.



Chart 1:  Burst Media Research, April 2007
N= 180 respondents


One-half (54.7 percent) of respondents who have watched an online automotive video say it made them more likely to consider purchasing or leasing the model that was featured. The positive impact of online video was most apparent with respondents who were 18-34 years old. Within this age segment, nearly two-thirds (64.2 percent) who viewed an online automotive video say it made them more likely to consider purchasing the vehicle featured. 


Among respondent who have not yet viewed online automotive video, fully one-half (52.9 percent) say they would likely do so as they research vehicles they might purchase or lease. This demand exists among men and women; and among all age and household income segments. One interesting finding, beyond vehicle consideration, is the impact online automotive video may have on brand image. Respondents who have viewed an online automotive video are more likely than those who have not to say automobile companies are "cutting edge" in their advertising: 37.1 percent versus 19.3 percent, respectively.


Conclusions
The findings validate the enormous impact the internet has on the consumer's automotive purchase process. It is consumers' preferred choice when gathering information to make their automotive purchase, and it is also affording automotive marketers new creative outlets to deliver their advertising messages. One of the most promising of these new online creative outlets is video. Online video content can provide a highly engaging experience for web surfers. For automotive marketers, online video is an opportunity to deliver vast amounts of product information in a highly engaging, entertaining and branded environment.


Chuck Moran is manager of market research at Burst Media. .

Chuck Moran is responsible for leading RhythmOne's creative products team to find unique opportunities in a dynamic, digital marketplace. With over 20 years of digital marketing experience, Chuck has developed a broad understanding of the connected...

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