Automotive Industry Digest

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Covid triggers landmark shift in car buying habits

New research from cargurus the fastest-growing online automotive marketplace in the UK[i], shows that the majority of car buyers now conduct most of their buying journey online. This includes doing most of their purchase research and decision making from their desktop or mobile device before ever contacting a dealership.

While the shift to digital was already in motion before COVID-19 struck, the pandemic has accelerated the trend. According to the cargurus 2021 Buyer Insights Report, 63% of car buyers surveyed during the pandemic said they were now open to buying a car online, up from 43% before the pandemic.

The research also highlighted both the extent to which consumers seek out information online prior to engaging with a dealership, and the impact on their purchasing decision that such research can have. Seventy-one percent (71%) of buyers reported exhaustively researching and comparing vehicles, while nearly half (45%) will wait until they are very or extremely certain a vehicle is a good fit before contacting a dealership on an online car buying site like cargurus.

While the research indicates the digital journey is increasingly appealing for buyers, interaction with dealers on-site is as important as ever, with cargurus research still suggesting most (67%) still ultimately prefer to buy their car in-store and in-person[ii].

Despite seventy-two percent (72%) of buyers admitting that they began their search undecided on where to buy, half of those who would ultimately buy from a dealership (50%) revealed they visited just one dealer during the buying process.

With such an emphasis now placed on the impression buyers form during their research, the report highlights both the impact of a trustworthy digital presence for dealers and the importance to consumers of doing business in a transparent online environment.

The cargurus report analysed the digital purchasing paths of over 1,500 car buyers in the UK to investigate consumer trends, attitudes, and the continued evolution of the market during Covid-19. With dealerships across the UK planning to reopen in April pending government guidance, the research points to a similar pent-up demand as experienced in July 2020, when year-on-year sales increased by 11.3%[iii] following the first lockdown.

In fact, the report found that nearly all (93%) buyers said they plan to maintain or increase the number of vehicles in their household, and over a third of millennials indicated they plan to buy more.

When it comes to choosing a car dealer, 59% of buyers said price was the most important consideration, followed by location (39%), probability of a fair deal (27%), and availability of inventory (23%). What drives vehicle selection? Practical factors such as budget (38%), reliability (34%), and driving feel (29%). After researching independently online, buyers first reach out to dealers most often by phone (36%) or online (31%).

Wendy Harris, cargurus, UK Managing Director said: “The car buying journey has evolved rapidly over the past year, largely influenced by the limitations imposed by the pandemic. The good news is that many dealerships are embracing this shift toward digital and they have used this time to adapt their processes to meet the expectations of today’s car buyers.

“We are seeing evidence of pent-up demand building with consumers actively researching their next car purchase on cargurus and pistonheads. It is a critical time for dealers to focus on their digital presence in order to build pipeline ahead of dealerships reopening.”

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Automotive Industry Digest

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