Free Access Articles, Management Workshop, Marketing , ,

AS AUSTRALIANS have hunkered down to weather the recent period of financial uncertainty, a new generation of buyers has emerged; younger, with a higher income and more influenced by online advertisements.

Representing more than one-in-ten new buyers in the automotive market, this new group of buyers is more interested in cars (53 per cent) than SUVs (30 per cent) compared to the more typical automotive buyer (41 per cent and 45 per cent respectively), showing a major difference in trends compared to the new-vehicle industry.

The new data is contained in a research report: Connect with the New Digital Car Buyer, commissioned by Autotrader and Gumtree Cars, and undertaken by BrandSpark. It uncovers how Australians’ buying behaviours have accelerated throughout the pandemic and outlines the opportunities for dealers to capitalise on this new generation of customers.

The report was presented by Richard Dicello, dealer sales director of Autotrader and Gumtree Cars at the AADA Convention & Expo held online this week.

The data revealed that one-in-two buyers start their search on vehicle marketplaces and automotive review sites. It said this highlights the need for dealerships to utilise every channel at their disposal to help maximise exposure.

“Over half of vehicle buyers agree that having an online showroom will make them more likely to purchase from a dealer. Even more so for the digital-first buyer segment that we’ve seen emerge in light of the COVID-19 pandemic.”

Mr Dicello also revealed that this new emerging vehicle buyer is more likely to travel in search of a good deal; with almost half of buyers admitting they’d travel 100-plus kilometres if the price was right.

“This new group of customers are more knowledgeable and are enjoying the shopping process of searching for their next vehicle purchase, more so than we’ve typically seen in the past. This group is willing to move quicker through the purchasing process in order to get a good deal and unwilling to compromise on quality.”

The research showed that COVID-19 has accelerated consumer buying behaviour across all vehicle categories with almost two-thirds (62 per cent) of car buyers now starting their search online and visiting classified platforms more than ever before.

“Despite a range of restrictions in place during the surveying period, consumer optimism still remained high proving the COVID-19 pandemic has not derailed the automotive industry but in fact, was the catalyst in an evolution and transformation of its digital offering,” the report said.

“In fact, both recent vehicle purchasers and auto intenders admit that a digital presence for a dealership is now much more than a tick-box exercise and an essential step in the purchasing journey.

Richard Dicello

“Further demonstrating the importance of an online presence, 60 per cent of vehicle buyers say it’s critical to have a digital showroom and a further two-thirds of buyers (66 per cent) indicate an online showroom showing transparent details including location, branding and hours of operation will encourage purchasing.

Mr Dicello said: “Over the past 12 months, the automotive industry has faced a wave of challenges from a variety of external forces including the decline of new-car sales and a change in credit conditions which has caused the need to pivot our business strategies.

“While customers transitioning to an online environment is nothing new, the increased adoption rate and demand for dealerships to meet them online has caused the industry to take note,” he said.

“Third-party classified sites remain the most popular and helpful resource for auto intenders across all segments, being the first step a buyer takes (69 per cent) when searching for their next vehicle, up five per cent compared to 2019.

“For many dealerships across the country, this presents an opportunity to engage in a multi-channel experience in order to provide a wider variety of opportunities and influence the shopper.

“As the most consistently trusted resource for vehicle shoppers, online classifieds are of particular interest to both new and used and used-only vehicle shoppers in helping to narrow down options and choosing which dealership to purchase from.

“Therefore, dealerships should be taking advantage of this opportunity by continuously optimising their online classifieds.”

Mr Dicello said the economic environment was especially conducive to dealer sales.

 “According to the Australian Bureau of Statistics, household savings are at the highest rate for over 25 years. This has increased appetite for significant purchases such as vehicles, with both new and used consideration almost twice as big as used only.

“Being the first dealer people visit is critically important, which is why these first impressions count as even those buyers that “shop around” will typically come back; 80 per cent of buyers ultimately purchase their next vehicle at the first dealer they visit.

“When choosing a location to shop, openness, honesty and transparency (45 per cent) were cited as reasons buyers purchased from a particular dealership while fair prices (42 per cent) and high-quality vehicles (33 per cent) were other key factors.

“Interestingly, the modern salesperson now requires skills beyond vehicle sales experience to be successful. Interpersonal skills including effective communication, positive attitude and strong listening skills are now almost 30 per cent more valuable than sales experience and vehicle knowledge,” Mr Dicello said.

By John Mellor

Manheim
DealerCell
Schmick