the automotive industry consumer lanscape

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AUTOMOTIVE INDUSTRY PROFILE + LANDSCAPE

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This Automotive Industry Insights paper provides a high level overview of the US Automotive Consumer Landscape. Featured insights include search demand for automotive parts and services, trends in vehicle ownership and use, research habits of consumers and the role of mobile devices in research and purchase. Visit additional insights and case studies from Levelwing: http://ow.ly/dM4KF

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Page 1: The Automotive Industry Consumer Lanscape

AUTOMOTIVE INDUSTRY PROFILE + LANDSCAPE

Page 2: The Automotive Industry Consumer Lanscape

2

WHY DO I CARE?

Glad you asked…

In this report you will find a high-level overview of the U.S. automotive landscape. It is important that we keep a pulse on the industry and CONSUMER BEHAVIORS in order to identify OPPORTUNITIES that transform our businesses.

At Levelwing, we specialize in analyzing the paths that contribute to meaningful BUSINESS OUTCOMES. These paths are illuminated through the analysis of data collected via website analytics, customer relationship databases, consumer research, phone call logs and even recruitment application databases (yes, we actually enjoy working with the HR folks in addition to the marketing teams).

Our team of analysts, statisticians and strategists are obsessed with data and are experts at TRANSLATING THE DATA INTO A MEANINGFUL STORY that has real business applications and implications.

Please enjoy some of the insights contained within.

Page 3: The Automotive Industry Consumer Lanscape

AUTOMOTIVE CATEGORY CATEGORY OVERVIEW

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Page 4: The Automotive Industry Consumer Lanscape

AUTOMOTIVE CATEGORY SEARCH DEMAND 4

KEYWORD COMPETITION US MONTHLY SEARCHES

AUTO REPAIR High 2,240,000

NEW TIRES High 165,000

NEW CAR High 3,350,000

AUTO PARTS Medium 6,120,000

Source: Google

Collectively, the automotive category has a substantial amount of monthly searches within the United States. Online searches are often indicative of offline demand. This emphasizes the need for visibility within search engines and search engine results pages in order to capture this traffic.

Page 5: The Automotive Industry Consumer Lanscape

MILES DRIVEN - US 5

Travel on all roads and streets increased by 0.4% (1.1 billion vehicle miles) for June 2012 as compared with June 2011 and cumulative travel for 2012 increased by 1.1% (15.6 billion vehicle miles). Cumulative estimate for 2012 is 1,455.7 billion vehicle miles of travel. As miles driven increases so too does the need for routine car maintenance and new tires.

Source: U.S. Department of Transportation

1,400

1,600

1,800

2,000

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3,000

Jan-8

7

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Ve

hic

le-D

ista

nc

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rave

led

(B

illio

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Year

Moving 12-Month Total on ALL Roads

Page 6: The Automotive Industry Consumer Lanscape

VEHICLE OWNERSHIP 6

In addition to consumers driving more miles, they are keeping their vehicles for longer periods of time so they are driving more miles on those same vehicles. As the average age of cars on the road increases, the need for routine maintenance and new tires for those cars also increases.

52% of consumers intended to

keep their cars 5 years or more

“2011 Aftermarket Outlook Survey”, The NPD Group, Feb 2011

61% of consumers expecting car repairs would have a professional do all the work “2011 Aftermarket Outlook Survey”, The NPD Group, Feb 2011

Avg age of car driven increased to 8 years

Consumer Reports National Research Center, Apr-May 2011

23% of motorists are

driving cars from 1990s

Consumer Reports National Research Center, Apr-May 2011

Page 7: The Automotive Industry Consumer Lanscape

7 INDUSTRY SEARCH DEMAND & VOLUME

Top cities searching for “auto repair” in the last 12 months include: San Diego, Minneapolis, Seattle, Denver, Phoenix, Chicago, St. Louis, San Francisco, Los Angeles, and Atlanta. Market level search insights can assist can help fuel strategies in which there is high demand (and we want to leverage this) or where there is low-demand (perhaps in a market we are trying to dominate). Source: Google

Page 8: The Automotive Industry Consumer Lanscape

MILES DRIVEN BY STATE – TOP 5 8

STATE MILES DRIVE iN JUNE

(IN MILLIONS)

CALIFORNIA 28,401

TEXAS 19,844

FLORIDA 16,019

NEW YORK 11,145

ILLINOIS 10,582

When comparing the top twelve cities searching for “auto repair” to the top five states with the most driven miles in June, three of the top twelve cities searching for “auto repair” are located in California, the state with the most miles driven in June. As miles driven increases so too does the need for vehicle maintenance and searches for service including, “auto repair.”

Source: U.S. Department of Transportation

Page 9: The Automotive Industry Consumer Lanscape

AUTOMOTIVE CONSUMER

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RESEARCH BEHAVIOR

Page 10: The Automotive Industry Consumer Lanscape

ONLINE RESEARCH HABITS 12

During online research for tires, 65% of consumers go directly to an automotive tire website and 48% use a search engine. These online search habits indicate the need for visibility within search engines and search engine results pages during this critical research period.

Source: Custom Compete Data

48%

65%

0% 10% 20% 30% 40% 50% 60% 70%

Social networking websites

Video sharing websites

Online magazines/newspapers

3rd Party automotive websites

Consumer generated online reviews

Dealership websites

Professional online automotive review websites

Search engines

Automotive tire websites

Page 11: The Automotive Industry Consumer Lanscape

ONLINE RESEARCH HABITS 13

Over one third of users utilized search throughout the research process. This behavior further necessitates the need for visibility within search engines and search engine results pages.

Source: Custom Compete Data

42%

12%

10%

31%

41%

10% 10%

37%

51% 13%

8%

23%

Parts

47%

7% 4%

41%

Accessories

Search Usage During the Research Process

Tires

Services

Used this source at the very beginning of my research Used this source in the middle of my research Used this source at the very end of my research Used this source throughout the entire process

Page 12: The Automotive Industry Consumer Lanscape

OFFLINE RESEARCH HABITS 14

Examining offline research habits can illuminate areas of opportunity. For instance, 30% of people indicated they made an offline purchase because they wanted to talk to a salesperson. Incorporating a “Live Chat with Sales Representatives” feature on your website can give your online customers a better experience.

Source: Custom Compete Data

5%

7%

49%

10%

10%

19%

Offline Purchase

local tire store

warehouse store

retail store

national tire/ service center

dealership

other

39% more convenient to purchase in person

38% I needed it immediately

30% I wanted to talk to a salesperson

27% better prices

25% faster to shop in person

Offline Purchase Drivers

Page 13: The Automotive Industry Consumer Lanscape

RESEARCH TIME 15

Purchase reason influences research time; repair shoppers are three times as likely to decide in less than a day. These purchase behaviors indicate the need to provide website visitors with exactly the information they are seeking on their first visit to your site during this critical research period. Source: Custom Compete Data

10% 17%

27%

30%

43%

38%

31%

21% 19%

16%

12% 8% 6% 3% 3%

7% 4% 5%

enhance performance/ appearance routine maintenance repair

Less than 1 day 1 day to less than 1 week 1 week to less than 2 weeks

2 weeks to less than 3 weeks 3 weeks to less than 4 weeks 4 weeks or more

Page 14: The Automotive Industry Consumer Lanscape

VIDEO AS RESEARCH SOURCE 16

Most service shoppers who watched videos were interested in general information and instruction. Creating a YouTube channel with instructional videos and general information surrounding auto repair and maintenance will fulfill these consumer needs. Including links to your website within the videos and video descriptions will encourage visitor transfer. Source: Custom Compete Data

42%

47%

56%

0% 10% 20% 30% 40% 50% 60%

Other

Compare features

Watch customer testimonials

Decide which company to purchase from

Understand specific features

Watch instructional videos

Obtain general information

Page 15: The Automotive Industry Consumer Lanscape

SMARTPHONE USAGE 17

As smartphone ownership increases so does the necessity of having a mobile website for consumers using these devices for product and service research.

Source: comScore, June 2012

110 MILLION Americans own a smartphone

More than

Page 16: The Automotive Industry Consumer Lanscape

MOBILE AS RESEARCH SOURCE 18

Most service shoppers using a mobile device for research want to read reviews, find deals, and compare prices. Ensuring these elements are prominent on your mobile site will provide an optimal user experience for mobile website visitors. Source: Custom Compete Data

35%

38%

39%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Watch an online video about a service

Search a service availability

Schedule a service appointment

Call a retailer, manufacturer, or business

Locate a service provider

Read general service information

Compare features

Contact business other than by calling

Compare prices

Look for promotions, coupons, or discounts

Read reviews

Page 17: The Automotive Industry Consumer Lanscape

MOBILE COUPON REDEMPTION 19

30% of mobile users are willing to travel 5+ miles to redeem an automotive coupon. Understanding the unique motivations driving the mobile consumer can lead to greater clarity in local and location-based opportunities.

Source: Internal Google Data

Page 18: The Automotive Industry Consumer Lanscape

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LIKE WHAT YOU SEE? WANT TO SEE MORE?

This is just the beginning of what we can tap into. Imagine what we could do with the data you have internally…

At Levelwing, we specialize in interpreting your data and providing you with applications (and not just graphs) that can impact your MARKETING, MERCHANDISING, INVENTORY or even TALENT RECRUITMENT. We help companies utilize data to OPERATE WITH GREATER CLARITY + PROFITABILITY.

Bottom line, we move your business forward by helping you make sense of your data so that you can ACHIEVE WHAT COULD BE.

For additional information, please contact: STEVE PARKER, JR. Co-Founder and Managing Partner [email protected] 1 + 843.631.4587

Page 19: The Automotive Industry Consumer Lanscape

THANK YOU

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Want to learn more about Levelwing? Just keep reading.

Page 20: The Automotive Industry Consumer Lanscape

WHO IS LEVELWING?

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Page 21: The Automotive Industry Consumer Lanscape

The Right Data Changes Everything

Marketing Budgets Should Be Smaller, Not Larger

Accountability is Essential

Success Should Pay For Itself

Leverage Existing Demand First

OUR BELIEFS 23

Page 22: The Automotive Industry Consumer Lanscape

We use data to illuminate all facets of your business. You’ll sell more and enjoy greater cost-efficiency.

More importantly, you’ll operate your business more PROFITABLY.

THE RIGHT DATA CHANGES EVERYTHING 24

Page 23: The Automotive Industry Consumer Lanscape

Bigger is not necessarily better.

We believe by holding media and ideas accountable through advanced analytics, you can do MORE with LESS.

MARKETING BUDGETS SHOULD BE SMALLER, NOT LARGER

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Page 24: The Automotive Industry Consumer Lanscape

We measure and create insights based on what’s important, not just metrics that are easy to calculate.

We create real ACCOUNTABILITY.

ACCOUNTABILITY IS ESSENTIAL 26

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An understanding of Return on Investment leads to marketing efforts that are more than just an expense line item.

We build SELF-FUNDING initiatives.

SUCCESS SHOULD PAY FOR ITSELF 27

Page 26: The Automotive Industry Consumer Lanscape

A demand-driven strategy creates media efficiency and greater profitability by focusing on existing IN-MARKET PURCHASERS.

AWARENESS

INTEREST

CONSIDERATION

PURCHASE

LEVERAGE EXISTING DEMAND FIRST 28

Page 27: The Automotive Industry Consumer Lanscape

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Our BUSINESS INTELLIGENCE SOLUTIONS help organizations understand consumer brand perception, gain competitive information and uncover real opportunities to improve organizational and operational efficiencies.

WE BELIEVE in informed, evidence-based decision-making, only made possible by complex and comprehensive data collection + analysis.

INTELLIGENCE IS AT OUR CORE

Competitive Insights | Data Enrichment | Operational Efficiency | Price Sensitivity

Analysis | ROI Analysis | Analytics Solutions | Data Knowledge Management

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Page 28: The Automotive Industry Consumer Lanscape

GLOBAL REACH We currently serve clients throughout North America, Europe, China and Japan

UNIQUE APPROACH Levelwing is the leader in business intelligence and marketing solutions with data mining + analytics at the core

MEASURED SUCCESS Levelwing has experienced 10 consecutive years of growth with industry leading client satisfaction results

FULLY INTEGRATED We employ a matrix organization of marketers, analytics design experts, statisticians, researchers and creatives

WE ARE LEVELWING 30

Page 29: The Automotive Industry Consumer Lanscape

“Some of the most innovative and strategic minds in the industry” - Novartis

“Some of the most sophisticated things I’ve seen being done with analytics and ROI measurement” - Adobe

SOME OF OUR PARTNERS 31