Ad-ology: Used-Car Purchase Intent Slides 55 Percent
An economy that is apparently on steadier ground has brought good tidings for the new-vehicle market, but that may not be the case for the used-car business.
Coupled with an older crop of vehicles on the road, perceptions of a stabilized economy are helping push many shoppers to new vehicles instead of used units, according to the most recent Ad-ology Auto Shoppers Forecast.
In fact, the number of consumers with plans to buy a used vehicle in the next 12 months dropped 55 percent year-over-year. Less than a sixth (15.6 percent) of consumers said at the time of the study (May) that they intended on buying a used vehicle in the next year, Ad-ology indicated.
Conversely, more than a third (36 percent) said they would buy a new ride, a 64-percent increase from May 2011.
“Aging vehicles and perceived stability in the U.S. economy are leading many consumers to shop for new vehicles rather than used,” stated C. Lee Smith, president and chief executive officer of Ad-ology Research.
“Some of these potential buyers may encounter sticker shock and credit difficulties, however, and choose to purchase a pre-owned vehicle instead,” Smith added.
Top Brands for Used Shoppers
Among the crop of shoppers searching for a used vehicle, the brand most often cited on consumers’ consideration lists was Ford. The Blue Oval — whose consideration was at 48.7 percent — was tops for the second straight year.
That said, it has some challengers.
Toyota, for example, saw a double-digit increase from May 2011 in its consideration level, which came in at 45.8 percent. Honda, Nissan, Kia and Hyundai each posted double-digit consideration gains, as well.
On the opposite end of the spectrum, showing a “big decline” were Jeep and Subaru, the firm said.
Information & Influences
As far as where they are getting information, the overwhelming majority of used-vehicle shoppers (82.6 percent) pointed to their spouse/significant other as the most vital source outside of the test drive.
Interestingly enough, Ad-ology also found that used shoppers were influenced more by dealer websites and salespeople than parents, friends or siblings.
Standard guides also have a big impact on these shoppers. More than 81 percent utilize Kelley Blue Book and 78.8 percent turn to Consumer Reports. Almost three-fourths (74.1 percent) utilize Carfax.
“Nearly four in ten of those in the market for a used vehicle say they’ve taken action — clicking, searching, calling, visiting the dealer or their website — within 30 days of viewing television advertising,” Smith stated. “However, 64.1 percent say they think negatively of used vehicle dealers whose commercials are too loud.”
Continuing along, Ad-ology also pointed to interactive marketing as a critical cog once again this year. More than half (54 percent) of used-vehicle shoppers say they’re more likely to make a purchase if they have interacted online with a brand or dealership.
This includes things like email, blogs and social media.
And speaking of technology, potential used-car shoppers have increased their smartphone usage by nearly 41 percent, Ad-Ology said, also pointing out that “usage directly tied to the buying process has also grown dramatically.”
For example, 47.1 percent of used shoppers have snapped photos of potential used-car buys on their smartphone, which is a 1.1-percent year-over-year increase, the firm said.
What’s more, the amount of used shoppers using their smartphones to find dealers has jumped 30 percent, coming in at 26.4 percent this year.
More than a quarter (25.5 percent) have tuned into video of a car on their list , a 20.3-percent hike. And in an even sharper uptick, the amount of used shoppers snapping a QR code as they research a vehicle (21.6 percent) skyrocketed 154.1 percent.