Before new car buyers go out to kick the tires at their local car dealer, nearly two-thirds of them first research auto makes, models and prices on the Internet, according to a report released Monday by J.D. Power & Associates.
“The Internet provides automotive shoppers with information of real value that not only continues to attract new users, but also keeps them coming back for more,” said Chris Denove, partner and senior director of automotiveretail research at the Agoura Hills, California-based firm.
The research firm’s Autoshopper.com 2001 report found that 62 percent of new-car buyers turn to the Web for information, compared to 54 percent in 2000.
However, new online car sales continue to lag. J.D. Power said that 6 percent of all new vehicles were sold through an online buying service, up from 4.7 percent in 2000.
Those car buyers who do go online visit an average of 6.8 sites each.
Compare and Contrast
Third-party sites offering independent information are the most popular choice for comparison shoppers, the report said. KelleyBlueBook.com and Edmonds.com ranked No. 1 and No. 2 among online car shoppers.
However, carmakers themselves are beginning to attract more visitorsthrough heavy promotion, the survey found.
“Companies such as BMW and Isuzu that instituted offline campaigns to drive customers to their Web site saw the largest increases in automotive Internet usage,” Denove said. “The best way for a manufacturer to drive traffic toits Web site is to feature the site as part of its traditional advertising campaign.”
Some Buy, Too
Autobytel.com (Nasdaq: ABTL) again ranked as the top independent site for new car sales, J.D. Power said, while among manufacturers, GM’s BuyPower.com ranked as the most efficient site for generating new car purchases.
As they cast around for the winning online sales formula, automakers have been seen as the beneficiaries of failures andconsolidation among many of the pure-play car sales sites.
In fact, Jupiter Media Metrix (Nasdaq: JMXI) reported in September that carmakers were about to surpass third-party sites in traffic because visits to manufacturer’s sites were skyrocketing.
Driving Lessons
Earlier this year, however, J.D. Power found that car dealers were largely mishandling that opportunity, in partbecause they were not clear on how to best use the Web to drive buyingtraffic onto their lots.
J.D. Power said it expanded its survey for 2001, questioning more than26,000 customers who bought model year 2001 and 2002 vehicles.
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I have heard very little about the effectiveness of using the web as a tool for dealers to sell used vehicles. If you consider the time and energy costs involved in the search activities of a used vehicle buyer – it is easy to see why the net works for this product. Online vehicle listings save the consumer the hassle of poring through newspapers, driving past car lots and phoning dealers individually. Instead, they just bring up the dealer’s listings in the comfort of their own home. This is one of the best examples of where the web provides obvious and easily attainable benefits for both the consumer and the business.
I agree with you. I work as a web site administrator for a Peugeot-owned dealership in the U.K. Peugeot last year actually won an award for being the best manufacturer web site. However, the dealer I actually work for is very slow in using Peugeot’s initiative to get more people visiting our local web site. More training should be initiated in the benefits of marketing and sales via the Internet, especially for the salespeople, who in general have very little understanding of this marketplace.