S&P Chief Economist, J.D. Power Executive Offer Cautious but Positive Outlooks

Two experts from Standard & Poor’s and J.D. Power offered cautiously positive outlooks for the U.S. economy and for the U.S. auto industry to some 300 auto dealers and industry participants during the recent Western Automotive Conference, sponsored by J.D. Power and the National Automobile Dealers Association (NADA).

Beth Ann Bovino, U.S. chief economist for Standard & Poor’s, said that the U.S. is in its fourth year of recovery with an average growth rate of 2%. On a global level, she cited challenges to be faced including a slowdown in China, the remaining effects of the debt crisis in the Eurozone, and spikes in global oil prices.

In addressing current conditions in the U.S., Bovino said the Fed is focusing on creating jobs and is offering incentives for businesses to invest and hire, which will lead to higher growth. She said there has been robust demand and hiring in the private sector in spite of shocks. Continue reading ›

Experts Discuss how Millennials Consume Content, Shop Differently

AMR 2013 audienceReaching millennial consumers is a key focus for marketers in the auto industry, and was a key topic during presentations and panel discussions at the October J.D. Power Automotive Marketing Roundtable in Las Vegas, NV. A few highlights from a few sessions with panelists and presenters that addressed millennial consumers are presented.

“Let’s talk about millennials. . . They won’t get cable. They don’t have any money. They’re entitled. They want to do their own thing. They’re a completely digital first generation.”—Mike Shields, digital editor of AdWeek

How Different are their Media Consumption Habits?

“My team at Microsoft—80% of them are millennials—it’s an on-demand environment. They want to consume a lot of content at the same time. They can do it better than any other group. Some 83% are using a second screen and multi-tasking. . .You have to make sure you have something there to complement what they are consuming on TV.”—Randy Shaffer, director, Xbox West Sales, Microsoft

“We see ‘fanboys’ consuming media voraciously across all platforms. They go to five movies a month. They’re watching two more hours of television—on demand—than their own peer set. They’re consuming a ton of web video. In the case of gamers, they are willing to pay for content. They’ve been paying for $60 games for a very long time. . . You need to figure out how to present it to them. They will steal it first if they have to. But, if it’s good, they are willing to pay for it—that’s proven in gaming, premium video and web video content as well.”—Jay Sampson, executive vice president, sales and operations, Machinima Continue reading ›

Urban Shift Impacts India New-Vehicle Shopping Behavior

Mohit Arora

Mohit Arora

During the past five years, demographic differences in India and urban shifts have been creating distinctive regional shopping behaviors as well as different regional ownership experiences among new-vehicle buyers, according to our 2013 India Escaped Shopper Study (ESS).

A few of the major regional changes that J.D. Power Asia Pacific observes in the study that examines the reasons why new-vehicle shoppers consider but ultimately reject certain models in favor of another are highlighted:

• There has been a regional surge in first-time new-vehicle buyers mainly in the Eastern and Western regions of India. Nearly 70% of buyers in the Western region and 57% of buyers in the East are purchasing a new vehicle for the first time.

• In contrast, the percentage of first-time new-vehicle buyers in the Northern region has declined while the first-time buyer percentage has remained flat in the South. Continue reading ›

Retailers Must Pitch the Product and Benefits, Not the Price

Editor’s Note: Automotive retailers need to embrace change and take advantage of new approaches to reach consumers. In a second post, Deirdre Borrego highlights key practices to help retailers satisfy and retain new-vehicle buyers. Excerpts from her article, “U.S. Dealers: Preparing for the Future,” published in the October issue of AutoRetailNet magazine include insight about shopping behavior for auto retailers. An earlier post included Borrego’s insight about Gen Y consumers.

Shoppers are Primed with Information Before Visiting a Dealership

Deirdre Borrego

With such a wealth of information available to vehicle shoppers in the digital realm—including pricing, options, incentives, as well as consumer and expert opinions about a brand, vehicle or specific dealer—shoppers know more about the choices available to them than ever before, and all prior to visiting a dealership.

Most of them know exactly what vehicle they want, the options and the technology associated with them, and how much they intend to pay for it. This knowledge gives them much greater leverage in purchasing their vehicle. As a result, if a retail salesperson is focused on price—rather than the product, the customer’s needs and the relationship—the salesperson is going to be doing the brand, the customer and the dealership a disservice.

Customers come into the dealership with much of the information they need at hand. The challenge for dealerships is to align the salesperson’s role with the customer’s needs in an increasingly information-accessible environment. Continue reading ›

Automotive Marketers Need to Understand Facebook’s Role in New-Vehicle Buyers’ Lives

Arianne Walker

Social networking website Facebook’s popularity means that new-vehicle buyers are often on Facebook just before visiting an automotive site, providing messaging opportunities for manufacturers, according to our 2011 Website Performance Tools Report, which analyzes results from clickstream* tracking of new-vehicle buyer Internet behavior that we produce in collaboration with Compete, Inc. during the 6 months before buyers make a purchase.

Some 6% of new-vehicle buyers who visit an OEM website visit Facebook immediately before going to a manufacturer-sponsored website, which is competitive with third-party automotive content providers Edmunds.com (8%) and AOL Autos (4%). Facebook matches Ford.com (7%) in the percentage of buyers who visit the social networking site after an OEM site visit. In addition, we find that Facebook “refers” three times as many new-vehicle buyers to OEM or third-party automotive sites as general Internet population traffic (6% vs. 2%, respectively). Continue reading ›