Study Shows Internet Creating a Drive For New Kind of Dealership Experience
25 June 1998
Polk Automotive Study Shows the Internet is Creating a Drive For a New Kind of Dealership Experience
DETROIT, June 25 -- Research findings released today by The
Polk Company indicate those who search for vehicle information through the
Internet require different treatment at the dealership than traditional
buyers. Most revealing was that buyers using the Internet place considerable
importance on the test drive.
As expected, Internet vehicle shoppers report less need for personal
interaction with a salesperson when choosing a new vehicle. After entering
the dealership, those customers report being influenced much more by the test
drive -- 64.9 percent indicate it is "very important" or "of critical
importance" to their purchasing decisions, compared to 55.5 percent of non-
Internet users.
Dealerships most likely to feel the impact of these changes in consumer
shopping behavior first will be those offering imports. Polk's study showed
more than 30 percent of customers purchasing a new vehicle from European
manufacturers used the Internet when shopping for a new vehicle. That's
double the rate domestic new-vehicle buyers use the Internet.
Manufacturer of Percent of Customers Using Internet
Purchased Vehicle To Shop for New Vehicle
European 31.1%
Asian 27.3%
Domestic 15.6%
Industry Average 19.3%
Polk's study also shows Internet usage is highest among more educated and
more affluent vehicle buyers, with usage exceeding 40 percent in the San
Francisco-Oakland market, but much lower in other markets (less than five
percent).
"Our research results show that this instant access to vehicle/dealership
information is changing the way customers relate to automotive dealers" said
Karen Piurkowski, managing director of Polk's consumer loyalty group.
"Dealers must recognize the differing needs of this customer group, which is
especially true for dealers offering import vehicles and competing in markets
where Internet usage is high.
"To appeal to those customers who shop through the Internet, the dealer
must make the test drive experience as positive as possible -- arranging
instant test drives (without the need for salesperson interaction) with a
vehicle that matches the customer's specifications. Sales interaction with
the customer should focus more on key attributes that distinguish the test
drive vehicle from its competitors, instead of just product features. The
salesperson must understand the choices the consumer is evaluating as if it
was his or her own purchase decision."
Polk's findings are based on information gathered directly from consumer
surveys through its proprietary loyalty study, conducted exclusively for the
automotive industry. Polk contacted new-vehicle-owning households who
returned to market during the 1997 model year to purchase or lease a new
vehicle. This study includes responses from nearly 40,000 consumers each
year.
The 1997 study shows 40.1 percent of new-vehicle-buying households report
using the Internet on a regular basis, nearly a threefold increase since
Polk's 1995 study of new-vehicle buyers. That explosion in usage has made the
Internet an important marketing tool for auto manufacturers and dealers,
particularly since one-third of the respondents reported the Internet was
"very important" or "of critical importance" to their purchasing decisions.
The Polk study also found Internet shoppers spend more time thinking about
their new-vehicle purchases; are more likely to buy/lease new sport-utility
vehicles, sporty or luxury cars; and are less likely to be loyal customers --
therefore, being good competitive conquests for auto manufacturers and
dealers.
"In addition to treating those customers differently when they enter the
dealership, dealers should consider relationship-building efforts through the
Internet both before and after customers come to the dealership," Piurkowski
added. "Communication efforts for Internet users can include quick responses
to e-mail inquiries, scheduling test drives at a convenient time and location
for the consumer (e.g., consumer's workplace or home), and continued e-mail
interaction after the sale to help gauge satisfaction and to build customer
loyalty."
Polk's Manufacturer Loyalty Excelerator(TM) (MLEX), the basis for those
findings, provides consumer behavior insight and was created to provide
household loyalty information to manufacturers at various levels. MLEX
determines loyalty percentages for the entire automotive industry, cross-
industry comparisons of loyalty behavior, and examines loyalty at various
levels, e.g., from the industry level down to the vehicle-line level. The
study measures loyalty throughout an entire model year to identify trends as
they occur in the industry. Polk also provides in-depth loyalty information
at a dealer level through its Dealer Loyalty Excelerator(TM) product.
Polk has served the automotive industry for more than 75 years and is the
longest standing curator of automobile records in the United States. Founded
in 1870, Polk launched its motor statistical operations in 1922 when the first
car-registration reports were published.
Polk provides multi-dimensional intelligence information solutions to
companies as a statistician for the motor vehicle industry; as a direct
marketing resource; as a supplier of demographic and lifestyle data and
database marketing services; as a publisher of city directories; and as a data
enabler for geographic information systems. Polk is a privately held firm
with facilities around the world, including the United States, Canada,
England, Germany, Barbados and Costa Rica.
For more information contact Jim Miller, director of public relations, at
303-298-5696, by pager at 800-406-8457 or jim_miller@polk.com.