103 2007 jd-powerautoshopperanalysisstevewitten
TRANSCRIPT
© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Online Automotive Shopping
Gene CameronVice President, Media Marketing Solutions
Steve WittenExecutive Director, Automotive Research
2© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
64% 64%67% 68%
70%
47%
54% 53%
59%
60%60%
54%
40%
61%^
26%
33%
43%47%
10%
20%
30%
40%
50%
60%
70%
80%
1999 2000 2001 2002 2003 2004 2005 2006 2007
New Used
1Based to new-vehicle buyers. Source: J.D. Power and Associates 1999-2007 New Autoshopper.com Studies2Based to used-vehicle buyers. Source: J.D. Power and Associates 1999-2007 Used Autoshopper.com Studies
Automotive Internet Usage (AIU) Trends New1 – Vs. Used2 – Vehicle Buyers 9-Year Trend
Automotive Internet usage (AIU) rates continue to increase
^Preliminary Data
% o
f A
ll B
uye
rs
3© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Method that Led to Used Vehicle Purchased
14%11% 10%
5% 5%
11% 12%16%
23%
9%
0%
5%
10%
15%
20%
25%
30%
Newspaper Classifieds Classified Ad Magazines Online Classifieds
Based to late model used-vehicle buyersSource: J.D. Power and Associates 2003-2007 Used Autoshopper.com Studies
23% of late-model used vehicles sold are sourced online
2003 2004 2005 2006 2007^
^Preliminary Data
% o
f A
ll B
uye
rs
4© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Percent of New-Vehicle BuyersSubmitting a Request for Online Dealer Referral
20% 21% 21% 22%
0%
10%
20%
30%
40%
50%
60%
2004 2005 2006 2007
Based to new-vehicle buyersSource: J.D. Power and Associates 2004-2007 New Autoshopper.com Studies
Request for online quote is not growing for new-vehicle sales
% o
f A
ll B
uye
rs
Visited DealerFound Online
39%
5© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
73%77%77%
80%79%
82%83%89%87%86%
84%
76%73%
83%
30%
40%
50%
60%
70%
80%
90%
100%
2001 2002 2003 2004 2005 2006 2007
Independent site Manufacturer site
1Based to AIUs. Source: J.D. Power and Associates 2001-2007 New Autoshopper.com Studies
Types of Web Sites Visited by New-Vehicle Online Shoppers
Manufacturer sites are more popular than independent sites among new-vehicle buyers
% o
f A
IU’s
6© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
47%48%51%
58%61%62%
66%
46%46%45%40%
36%34%31%
0%
10%
20%
30%
40%
50%
60%
70%
2001 2002 2003 2004 2005 2006 2007
Independent Sites Manufacturer Sites
1Based to AIUs. Source: J.D. Power and Associates 2001-2007 New Autoshopper.com Studies
First Auto Site Visitedby New-Vehicle Online Shoppers
Manufacturer sites are just as likely as independent sites to be the first site visited
% o
f A
IU’s
7© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
50% 51%
41% 40%
54%59%
62%64%68%
41%39%
31%28%
36%
0%
10%
20%
30%
40%
50%
60%
70%
80%
2001 2002 2003 2004 2005 2006 2007
Independent site Manufacturer site
1Based to AIUs. Source: J.D. Power and Associates 2001-2007 New Autoshopper.com Studies
Most Useful Type of Site Visited by New-Vehicle Online Shoppers
Manufacturer sites are catching up to the independent sites in being “most useful”
% o
f A
IU’s
8© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Percent of AIU's Using Consumer Generated Media
10%
3%
4%
5%
8%
12%
12%
21%
66%
5%
6%
6%
8%
9%
16%
16%
18%
64%
0% 10% 20% 30% 40% 50% 60% 70%
Networking Sites
Video/Podcasts
Chat Rooms
Photo-share Sites
Blogs
Q&A Sites
Forums/Boards
Enthusiast Sites
Consumer Ratings
New-Vehicle AIU's
Used-Vehicle AIU's
Based to AIUsSource: 2007 J.D. Power and Associates New Autoshopper.com & Used Autoshopper.com Studies
Consumer ratings are the most frequently used consumer generated media
55% = Very Helpful
9© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
The Vehicle Shopping Process
10© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
The Funnel Still Exists
Consideration
Purchase
Awareness
Familiarity
Visit Dealer
→ Make them aware of your model
→ Show your model is for them
→ Convince them to consider your model
→ Convince them to shop your dealership
→ Convince them to purchase your vehicle
The Goals
11© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Different media channels are more effective at distinct stages of the shopping funnel
Consideration
Purchase
Awareness
Familiarity
Visit Dealer
Marketing Channel
TV
Ad
s
Mag
azines
Intern
etN
ew
sp
ape
rs
Ev
ents
12© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Upper funnel marketing requires different metrics
Consideration
Purchase
Awareness
Familiarity
Visit Dealer
→ Change in awareness
→ Improvement in familiarity
→ Improvement of opinion
→ Click on ad
→ Click to site
→ Build a vehicle
→ Search inventory
→ Search for dealer info
→ Request a quote
Measures of Success
13© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Consumer Shopping Process
1. Should I be in market?– Resale value/condition of current vehicle– Change in vehicle needs– “Gotta have” new model
2. Which models meet my needs?– Price, styling, reliability, size– Previous experience– Advice from friends
3. Where should I purchase?– Price– Convenient location– Service
14© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Purchase Milestones of New-Vehicle AIU's
012345678910111213141516
Weeks Before Purchase (Mean)
Decide on typeof vehicle
Start visitingdealers
The new-vehicle shopping process takes about three months for the average AIU
Decide it was time to purchase
Shop vehicleson the Internet
Start activelyresearching vehicles
Decide onmodel
Purchasenew vehicle
14.7
11.7
11.0
10.4
7.6
6.3
0
Source: 2007 J.D. Power and Associates New Autoshopper.com Study. Based to AIUs.
15© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Purchase Milestones of Used-Vehicle AIU's
012345678910111213141516
Weeks Before Purchase (Mean)
Decide on typeof vehicle
Start visitingdealers
The process is not much different for late-model used vehicle buyers
Decide it was time to purchase
Shop vehicleson the Internet
Start activelyresearching vehicles
Decide onmodel
Purchasenew vehicle
14.9
13.8
10.9
9.9
10.1
6.9
0
Source: 2007 J.D. Power and Associates Used Autoshopper.com Study. Based to AIUs. Preliminary Data
16© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
One-third of new-vehicle buyers purchase within one month of deciding they need a new vehicle
Shopping Timeline of AIU's
8%
15%
10%
2%
18%
22%
13%13%
0%
5%
10%
15%
20%
25%
53 ormore
25 to 52 21 to 24 9 to 20 5 to 8 4 3 to 2 1 week
Weeks Before Purchase
Decide time to buy
34% Shopping Process One Month or less
27% Shopping Process Over Six Months
Source: 2007 J.D. Power and Associates New Autoshopper.com Study. Based to AIUs.
17© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
About half of AIU’s don’t begin their online shopping until one month before purchase
Online Vehicle Shopping Timeline of New-Vehicle AIU's
1%
9%
6%
18% 17%16%
17%16%
0%
5%
10%
15%
20%
25%
30%
53 ormore
25 to 52 21 to 24 9 to 20 5 to 8 4 3 to 2 1 week
Weeks Before Purchase
Use Internet forvehicle info
49% Online-ShoppingOne Month or less
16% Online-Shopping
Over Six Months
Source: 2007 J.D. Power and Associates New Autoshopper.com Study. Based to AIUs.
18© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Over one-third of new-vehicle buyers seriously consider only one model
Number of Vehicles Considered
34%
30%
20%
16%
0%
5%
10%
15%
20%
25%
30%
35%
40%
One Two Three Four or More
Loyal
Source: 2007 J.D. Power and Associates Escaped Shopper Study
19© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Those with only one vehicle on their shopping list are less likely to use the internet to vehicle shop
AIU Rate by Number of Vehicles Considered
48%
74%82%
88%
0%
20%
40%
60%
80%
100%
One Two Three Four or More
Number of Vehicles Considered
Use
d t
he
Inte
rnet
to
Sh
op
Source: 2007 J.D. Power and Associates Vehicle Shopping Study
20© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Those shopping several models are more likely to find independent sites more useful
Most Useful Type of Web Site Visited by Number of Vehicles Considered
38%
51%
10%
54%
38%
7%
0%
20%
40%
60%
Independent Manufacturer Dealer
Web Site Type
% M
ost
Us
efu
l
Only One More than One
Source: 2007 J.D. Power and Associates Vehicle Shopping Study. Based to AIUs.
21© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Online Vehicle ShoppingAnd Dealer Visits
22© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Internet's Influence on Decision Not to Purchase a Vehicle
Internet Influence
22%
Internet Did Not Influence
78%
Nearly one-fourth of new-vehicles shopped and not bought are rejected due to online information
Source: 2007 J.D. Power and Associates Escaped Shopper Study Base: Vehicles rejected
23© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Price, gas mileage, exterior styling, and reliability information is important in online shopping decisions
Reasons for Rejecting Vehicleby AIU's NOT Shopping at a Dealership
14%
15%
15%
22%
40%
0% 20% 40% 60%
Reliability
Gas Mileage
Exterior Styling
Monthly Payment
Price too high
% Indicating as Rejection ReasonSource: 2007 J.D. Power and Associates Escaped Shopper Study Base: Vehicle rejecters
24© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Compete – PIN Data Match
Online Behavioral Analysis of Vehicle Buyers
25© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Vehicle Buyer Click Stream Methodology
Compete Panel4.4M Records
Power Information NetworkDealers in Markets of 70% Sales
Vehicle Buyer Info
6/2005 – 7/2007
Surname &Address
Match
Third party
~73,700 Matches: with continuous click stream data 6 months prior to purchase (60% new-vehicle purchases, 40% used)
Internet activity
12/2004 – 7/2007
Site C
Site B
Site A
P - 6P – 3…P -2P - 1Purchase
26© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Half of franchise-dealer buyers visit a third-party site before purchasing a vehicle
Web Sites Visited Up to Six Months Before Vehicle Purchase
22%
43%
51%
24%
35%
52%
0%
10%
20%
30%
40%
50%
60%
70%
Dealers OEMs 3rd Party SitesSite Category
New-Vehicle Buyers Used-Vehicle Buyers
Base: Buyers with internet access NOTE: Preliminary data
27© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
33% of those who will visit a 3rd-party site, will do so at least six months before purchase
Cumulative Build of New-Vehicle
Buyer Traffic to 3rd-Party Sites
0%
20%
40%
60%
80%
100%
6 Months 5 Months 4 Months 3 Months 2 Months PurchaseMonth
Time Before Vehicle Purchase
Pe
rce
nt
of
Sit
e T
raff
ic
Previous Visitors Net New Visitors
Base: New vehicle buyers with internet access visiting a 3rd-party automotive site NOTE: Preliminary data
100%
78%
69%
59%
47%
33%
28© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
30% of those who will visit an OEM site, will do so at least six months before purchase
Cumulative Build of New-Vehicle Buyer Traffic to OEM Sites
0%
20%
40%
60%
80%
100%
6 Months 5 Months 4 Months 3 Months 2 Months PurchaseMonth
Time Before Vehicle Purchase
Pe
rce
nt
of
Sit
e T
raff
ic
Previous Visitors Net New Visitors
Base: New vehicle buyers with internet access visiting an OEM site NOTE: Preliminary data
100%
79%
67%
56%
42%
30%
29© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Auto sites are high in both composition and reach
0
100
200
300
400
500
600
700
800
900
1000
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Reach of Vehicle Buyers
Co
mp
os
itio
n In
de
x
Dealer Sites
OEM Sites
3Rd Party Sites
Calendar/Address Books
Web Site Composition and Reach Among Vehicle Buyers
Base: All vehicle buyers with internet access NOTE: Preliminary data
Search
30© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Top 10 Categories in Composition of Vehicle Buyers
323
335
344
376
413
416
652
657
686
944
0 100 200 300 400 500 600 700 800 900 1000
Sports News
Automotive Information
Vacation Packages
Ecards
Automotive Manufacturer
Business News
Automotive Dealers
Tax Services
Calendars/Address Books
Composition IndexBase: All vehicle buyers with internet access NOTE: Preliminary data
Reach
27%
21%
55%
22%
21%
39%
31%
11%
54%
25%
Auto shoppers can be found on non-auto sites
31© 2007 J.D. Power and Associates,The McGraw-Hill Companies, Inc. All Rights Reserved.
Summary
• Manufacturer and independent sites have reached parity– Dealer sites will be next
• The internet is the only medium that works efficiently across the entire shopping funnel
• Significant online shopping activity occurs six months out
• Highest bump in online auto shopping occurs within the month of purchase
• Purchase and web-wide behavioral data are now being linked for the first time creating new marketing insights