Cars.com Online CPO Insights Presentation Nov 2012
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Cars.com Online CPO Insights Presentation Nov 2012

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About the study ...

About the study

To help dealers and manufacturers understand more about shopper motivations for purchasing or considering a CPO vehicle, Cars.com conducted a survey of nearly 900 online car shoppers in June 2012 who intended to purchase or had recently purchased a CPO vehicle. The survey was served via Qualtrics survey tool utilizing Qualtrics’ survey panel of respondents.

Intenders n=590 and purchasers n=288

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  • CPO Insights Study n=878Mobile Car Shopper Study n=1502Pic of mobile phone appears when talking about mobile shopper data
  • CPO shoppers income are right on the edge of the typical new vs used shopper, which is partly why CPO is appealingMobile adoption is highest among the wealthier CPO shoppers
  • CPO shopper age distribution is in line with new auto shoppersMuch lower percent of young shoppers, under 35, than overall used shoppers
  • CPO shoppers are well-educated, compared to new shoppers
  • Ethnicity and marital status in line with new shopper demographics
  • Looking at overall demographics, CPO shoppers tend to look more like new than used shoppers on paper. What makes them different?
  • 2/3 of shoppers already visited a dealership to see a new or used car before even considering CPOAccording to the JD Power 2012 New Auto Shopper study, nearly two-thirds (68%) of new auto buyers ONLY considered a new vehicle when they first started shopping.
  • --CPO purchase horizon = long cycle----63% purchase in 2-6 months--Much higher percent of new shoppers purchase within a month----63% purchase in first 3 months--CPO shoppers visited dealership first -- extended purchase cycle
  • Half of CPO shoppers - narrowed consideration to 1-3 vehiclesConsideration set of vehicles is not too broad overall--most people don’t want to be overwhelmed by choices--they think they know what they want already
  • CPObuyers tend to spend less on a vehicle than they originally planned for--price drives CPO consideration --price is key part of the CPO value proposition
  • CPO buyers tend to spend less on a vehicle than they originally planned for--price drives CPO consideration --price is key part of the CPO value proposition
  • CPO buyers spend less--value in CPO program? ABSOLUTELY is there Value in WHO certifies?
  • Huge drop-off between intent and purchase of a CPO vehicle--Converted at dealership--From focus groups we’ve conducted internally, seems that many car buyers don’t understand the difference between OEM and non-OEM CPO programs--Messaging to differentiate the value of OEM CPO brand from non-OEM
  • --People tend to move up from where they started. --Shiny new toy syndrome kicks in on the dealer lot, emotions take over--Remember, CPO buyers spend less than they planned,
  • This underscores the true motivators for why shoppers consider CPO, as well as the value propositions that advertisers, OEMs and dealers can focus on to resonate with vehicle shoppersQuality,reliability, and price, are always top consideration factors for vehicle shoppers, particularly if the vehicle is not new
  • Looking further into quality, the real story here is TRUST --peace of mind, OEM warranty, brand reputation--Dealers have earned TRUST. Manufacturers have earned TRUST. Consumers want a vehicle they can TRUST.--Providing that peace of mind is key messaging to deliver across customer contact points, from advertising to in-person interactions on the sales floor--1 in 3 CPO shoppers want an extended warranty; these shoppers are already halfway on board with the value proposition of a CPO vehicle
  • Price is a top consideration factor for nearly everything we buyBeyond price--CPO shoppers are looking for a great value. They want to know their money was well spent--Low mileage; just as good as a new vehicleBeyond value--CPO shoppers feel like buying CPO is a smart decision--many consumers feel like they’re avoiding the instant depreciation hit and getting a great vehicle they can rely on--TRUSTKey messaging--appeal to shopper instinct in getting the most for their money, and that it’s a wise decision to do so--educate shoppers on ownership “peace of mind” and long-term cost savings of CPO vs. non-certified pre-owned.
  • Comparing luxury and non-luxury shoppers--Arrows showing key factors where luxury shoppers are different from non-luxury----Luxury shoppers are a little less concerned with getting the best price and lowest mileage----But more concerned with getting more bells and whistles--Also added the 11th reason to the bottom of the list – CPO allow at least 1 in 5 CPO shoppers to get into a vehicle they couldn’t otherwise afford----They want the luxury experience, but either can’t handle the cost or don’t see the value in buying the same car new----For luxury CPO shoppers, messaging should appeal to the emotion of the luxury experience----Need TRUST; need VALUE; WANT extra je ne sais quois.
  • --Many points of controlledmessaging--There’s no one clear place where consumers learn about CPO--People that learn about it at the dealer or on TV will then research it on the internet----contributes to the longer shopping cycle============================Dealer recommendations are powerful – the highest source of CPO consideration--floor sales staff should be well-versed in the benefits and value of CPO programs3rd party and dealer websites rank higher than OEM website--all 3 types of sites allow controlled messaging of CPO programs--important tools for communicating CPO value--differentiating from competitors
  • --Auto shoppers are doing their homework online, making decisions from their living room.--Across the board, the internet has a strong influence on what to buy, how much to pay, where to buy it--On and offline branding is key to staying competitive throughout the shopping process, from consideration through purchase--Inventory availability may be the reason Internet is slightly less influential on where to purchase ----dealers need to be diligent about online merchandising to differentiate from competitors ----make sure vehicle photos and listings are complete and put your inventory in the best light
  • Complete consumer value proposition of shopping on internet:Most people use the internet to determine which car they wantSignificant portion of CPO shoppers also using internet to decide where to buy the car, and how much to pay
  • Learn about CPODoes shopper form set of general assumptions that are universal to all CPO programs?Learning about CPO is ranked higher than researching extended warranties. Shoppers recognize that CPO is more than a warrantyDealership staff is the most common place that people first learn about CPO programs, but they still want to go home and research CPO programs more. It’s critical that dealer staff know how to present the value of CPO programs and build trust, so the customer will come back after doing their homework.
  • Top item = find a vehicle for sale----Underscores the importance of online merchandising----make sure vehicle photos and listings are complete and put your inventory in the best light--Notice the top items involve finding a vehicle, then finding dealer contact info so they can go see the vehicle. ----But at the bottom, a low percent of consumers want direct interaction with dealers--Consumers are taking control of the process and making decisions on their own terms vs. letting a dealer sell them on something.
  • 88% of mobile vehicle shoppers still say the traditional PC is most important for auto shoppingPercent of mobile study respondents that say each device is very or somewhat important for auto shopping
  • A Google study found that 36% of U.S. adults said they’d give up chocolate for a month if they could keep accessing the Internet on their smartphones. 43% would give up beer.
  • 88% said desktop/laptop was essential in auto shopping process– on prior slide
  • Mobile has become fully integrated into daily life and this chart shows us mobile auto shopping is no exception. Whether in-market consumers are at home in front of the TV or standing on the dealer lot, they are accessing related content to help them make the best purchase decision.
  • OEM recommendation: influence car shoppers throughout the shopping funnel in all the places where they’re narrowing down their options.Dealer recommendation: certify a good mix of vehicles to provide options throughout the buying process and maximize exposure for your dealership brand and inventory.
  • OEM recommendation: --provide comparison tools for consumers to utilize when considering their purchase options--ad campaign messaging in line with cross-shopping activityDealer recommendation: --Floor salespeople are very influential in driving consumer awareness – ensure your staff is educated on benefits and value of CPO.
  • 1 animation click!!Key messaging--educate shoppers on ownership “peace of mind” and long-term cost savings of CPO vs. non-certified pre-owned--appeal to shopper instinct in getting the most for their money, and that it’s a wise decision to do so

Cars.com Online CPO Insights Presentation Nov 2012 Presentation Transcript

  • 1. 2012 Cars.com Online CPO Shopper Insights David Greene Manager, Advertiser Insights
  • 2. Today’s AgendaObjectives and MethodologyCPO Shopper DemographicsMotivations for CPO ConsiderationInternet Role in Shopping ProcessConclusion
  • 3. Objectives Objectives • To gauge awareness of certified pre-owned vehicles (CPO) among consumers • To understand more about consumer influences and motivations for purchasing or considering a CPO vehicle • To better understand how car shoppers use their mobile devices in the decision making process
  • 4. MethodologyCPO Insights Study Mobile Car Shopper Study• Online Panel via Qualtrics • Online Panel via Nielsen• June 2012 • June 2012• CPO Shoppers n=590 • Auto Shoppers n=748• CPO Purchasers n=288 • Auto Purchasers n=754• Internet used to research/shop • Mobile device used to research/shop • Mobile apps, mobile websites, Internet
  • 5. Today’s AgendaObjectives and MethodologyCPO Shopper DemographicsMotivations for CPO ConsiderationInternet Role in Shopping ProcessConclusion
  • 6. Household Income 78% 63% New Shoppers 65% 58% Used Shoppers All Auto Shoppers**: $50,000+ All CPO Shoppers: Mobile CPO Shoppers*: $45,000+ $50,000+Q: Please choose the category that roughly includes your total annual household income before taxes. *Source: Mobile Web and App Usage for Automotive Shoppers Conducted on behalf of Cars.com by Nielsen, September 2012 **Source: Nielsen @Plan, Q2 2012; Shoppers that will definitely or probably purchase a new/used vehicle in the next six months.
  • 7. Age: Percent of Shoppers 35+ Years Old 60% New Shoppers 60% 58% All Auto Shoppers**: 35+ years old 51% Used Shoppers All CPO Shoppers Mobile CPO Shoppers*Q: Which of the following groups include your age? *Source: Mobile Web and App Usage for Automotive Shoppers Conducted on behalf of Cars.com by Nielsen, September 2012 **Source: Nielsen @Plan, Q2 2012; Shoppers that will definitely or probably purchase a new/used vehicle in the next six months.
  • 8. Education 36%New Shoppers: 20% 15% 9% New Shoppers College graduate Post-grad work Q: What was the last year of school you completed? Source: Nielsen @Plan, Q2 2012; Shoppers that will definitely or probably purchase a new/used vehicle in the next six months.
  • 9. Other CPO Shopper Demographics Caucasian 73% Married 58% Q: Prior to considering a Certified Pre-Owned vehicle, did you visit a dealership to see:?
  • 10. Today’s AgendaObjectives and MethodologyCPO Shopper DemographicsMotivations for CPO ConsiderationInternet Role in Shopping ProcessConclusion
  • 11. Before considering CPO Visited a dealership to see a NEW car 70% Visited a dealership to see a USED car 69% Q: Prior to considering a Certified Pre-Owned vehicle, did you visit a dealership to see:?
  • 12. CPO Shoppers Intend to Research and Shop Much Longer Than New Buyers CPO Shoppers New Vehicle Buyers* 38% 35% 28% 28% 20% 17% 15% 9% 1 month or sooner 1-3 months 4-6 months 7-12 monthsQ: You’ve indicated you’ve shopped for a used or Certified Pre-Owned vehicle. When do you plan to purchase or lease a vehicle?* New Vehicle Buyers from J.D. Power and Associates 2012 New Auto Shopper Study
  • 13. Number of vehicles considered at beginning of shopping process 44% 36% 14% 6% 1 2 to 3 4 to 6 6+Q: Approximately how many different vehicle models were you considering when you first used the Internet in your current or most recent vehicleshopping process?
  • 14. CPO buyers spend less than originally planned Price Planning to Spend 30% Shoppers/Buyers Percent of CPO 25% 20% 15% 10% 5% < $10,000 $10K- $15K- $20K- $30K- $40,000+ $14K $19K $29K $39KQ: What was the price of the Certified Pre-Owned vehicle you purchased, excluding tax, license, trade-in, rebate, etc.?
  • 15. CPO buyers spend less than originally planned Price Spent Price Planning to Spend 30% Shoppers/Buyers Percent of CPO 25% 20% 15% 10% 5% < $10,000 $10K- $15K- $20K- $30K- $40,000+ $14K $19K $29K $39KQ: What was the price of the Certified Pre-Owned vehicle you purchased, excluding tax, license, trade-in, rebate, etc.?
  • 16. How much is CPO worth? 54% 25% 22% < $1,000 $1,000-$2,500 $2,500+Q: Certified Pre-Owned vehicles, unlike other used vehicles, have been inspected, repaired, and given a warranty. Knowing that, how much extrashould a Certified Pre-Owned vehicle cost, compared to a similar used non-certified vehicle?
  • 17. Half of CPO Purchases Fall Into OEM Programs CPO Shoppers intending to buy OEM CPO 85% CPO Buyers that purchased OEM CPO 49% Q1: You mentioned that you are planning to purchase or lease a used or Certified Pre-Owned vehicle. Which of the following are you most likely to consider purchasing or leasing? Mark all that apply. Q2: You mentioned that you purchased or leased a Certified Pre-Owned vehicle in the past six months. Which of the following best describes the Certified Pre-Owned vehicle that you most recently purchased?
  • 18. Higher CPO Intent Than Purchase Among Mobile Shoppers Intenders Purchasers 35%Shoppers/Buyers 30% Percent of 25% 20% 15% 10% 5% Used CPO New Source: Mobile Web and App Usage for Automotive Shoppers Conducted on behalf of Cars.com by Nielsen, September 2012
  • 19. Top 10 Reasons Shoppers Consider CPO Quality/ Reliability 60% Lower price than new vehicle 55% Peace of mind that its a quality vehicle 51% Certified warranty is backed by OEM 47% Brand reputation 42% Lower mileage than a non-certified 39% Just as good as a brand new vehicle 38% I want an extended warranty 30% Vehicle Reviews 28% I can afford more features/options 23%Q: Which of the following are the most important factors that influenced you to consider a Certified Pre-Owned vehicle? Please select all that apply.
  • 20. Top 10 Reasons Shoppers Consider CPO: TRUST Quality/ Reliability 60% Lower price than new vehicle 55% Peace of mind that its a quality vehicle 51% Certified warranty is backed by OEM 47% Brand reputation 42% Lower mileage than a non-certified 39% Just as good as a brand new vehicle 38% I want an extended warranty 30% Vehicle Reviews 28% I can afford more features/options 23%Q: Which of the following are the most important factors that influenced you to consider a Certified Pre-Owned vehicle? Please select all that apply.
  • 21. Top 10 Reasons Shoppers Consider CPO: VALUE Quality/ Reliability 60% Lower price than new vehicle 55% Peace of mind that its a quality vehicle 51% Certified warranty is backed by OEM 47% Brand reputation 42% Lower mileage than a non-certified 39% Just as good as a brand new vehicle 38% I want an extended warranty 30% Vehicle Reviews 28% I can afford more features/options 23%Q: Which of the following are the most important factors that influenced you to consider a Certified Pre-Owned vehicle? Please select all that apply.
  • 22. Top 11 Reasons Shoppers Consider CPO Luxury Shopper Quality/ Reliability 60% Differences Lower price than new vehicle 55% ↓ Peace of mind that its a quality vehicle 51% Certified warranty is backed by OEM 47% Brand reputation 42% Lower mileage than a non-certified 39% ↓ Just as good as a brand new vehicle 38% I want an extended warranty 30% Vehicle Reviews 28% I can afford more features/options 23% ↑ It allows me to afford a luxury vehicle 22%Q: Which of the following are the most important factors that influenced you to consider a Certified Pre-Owned vehicle? Please select all that apply.
  • 23. Today’s AgendaObjectives and MethodologyCPO Shopper DemographicsMotivations for CPO ConsiderationInternet Role in Shopping ProcessConclusion
  • 24. Where do shoppers first learn about CPO? Dealership staff 20% TV ad 14% Prior experience 12% 3rd Party vehicle information site 11% Dealership website 11% Friend/family member 9% OEM website 7%Q: Where did you first learn about Certified Pre-Owned vehicles?Less than 2.5%: While servicing my car or while at the mechanic; Newspaper or magazine advertisement; Other Social networking website;Magazine or newspaper article; Radio advertisement; Online advertisement
  • 25. Did the Internet Change orInfluence Your Decision? No Strong Influence Influence Make or model CPO or new/used Price to pay Where to purchaseQ: On a scale of 1 to 5 where “1” means “No Influence” and “5” means “Strong Influence”, how much does your use of the Internetinfluence the following?
  • 26. What are CPO shoppers doing on the Internet? Research vehicle 92% What car Determine brands to consider 69%do I want? Determine type of vehicle I want 64% Where Learn about CPO programs 53% should I buy it? Read dealership reviews 43% Learn about negotiating price 33%How much should I Research extended warranty programs 33% pay? Q: In the past six months, have you used the Internet to: (Mark all that apply)
  • 27. What are CPO shoppers doing on the Internet? Research vehicle 92% Determine brands to consider 69% Determine type of vehicle I want 64% Learn about CPO programs 53% Read dealership reviews 43% Learn about negotiating price 33% Research extended warranty programs 33%Q: In the past six months, have you used the Internet to: (Mark all that apply)
  • 28. Interacting with Dealers Through the Internet Find Browse vehicle listings and read about options 66% vehicle Find dealership address 46% &dealership Find dealership phone number 43% E-mail a dealership for a price quote 39% Negotiate price through email 29% Have a dealership contact me by email 28%But don’t Have a dealership contact me by phone 21% call Instant message or online chat 17% me, I’ll Dont want to interact through Internet 10%call you! Q: Thinking about your recent online vehicle shopping experience, and how you might shop for vehicles in the future, how would you prefer to use the Internet to interact with vehicle dealerships while car shopping? (Please select all that apply)
  • 29. Device Usage for Vehicle Shopping Percent of Mobile Shoppers Indicating High Importance 88% 39% 49% Cell Phone Tablet PC/laptopHow important was each device in your vehicle shopping process?Percent of shoppers indicating 4 or 5, where 5 = extremely important, and 1 = not important.Source: Mobile Web and App Usage for Automotive ShoppersConducted on behalf of Cars.com by Nielsen, September 2012
  • 30. How Important Is Mobile? 36% 43%Source: Google/OTX, The Mobile Movement, U.S., April 2011
  • 31. How important is mobile to auto shoppers? Mobile device supplemented vehicle search, but most research done on PC/laptop 71% Info researched on mobile device is essentialfactor in decision to purchase specific vehicle 35% Source: Mobile Web and App Usage for Automotive Shoppers Conducted on behalf of Cars.com by Nielsen, September 2012
  • 32. Mobile Shoppers Access Automotive Content Wherever They Are 79% 58% 54% 50% 43% 43% 40% Home Watching While Work In a car Restaurant Dealership TV waitingSource: Mobile Web and App Usage for Automotive ShoppersConducted on behalf of Cars.com by Nielsen, September 2012
  • 33. Auto Information ResearchedWhile At a Dealership Pricing Information 57% General Information 22% Vehicle Feature Information 14% Vehicle Information 12% Information About Reviews 9%Source: Mobile Web and App Usage for Automotive ShoppersConducted on behalf of Cars.com by Nielsen, September 2012
  • 34. Today’s AgendaObjectives and MethodologyCPO Shopper DemographicsMotivations for CPO ConsiderationInternet Role in Shopping ProcessConclusion
  • 35. Key Takeaways CPO Shopping Cycle is Longer 35% 28% 20% 17% 1 month or 1-3 months 4-6 months 7-12 months sooner
  • 36. Key Takeaways Before considering CPO, visited dealership to CPO shoppers also see: consider new and used, non-certified vehicles prior to certified NEW car 70% vehicles. USED car 69% Q: Prior to considering a Certified Pre-Owned vehicle, did you visit a dealership to see:?
  • 37. Key Takeaways CPO shoppers are motivated by value, and they want a vehicle they feel they can trust. Messaging to CPO shoppers: • Peace of mind • Long-term cost savings of CPO • CPO is smart decision
  • 38. Thank you! 2012 Cars.com Online CPO Shopper Insights David Greene Manager, Advertiser Insights dgreene@cars.com @GreeneCars dealers.cars.com/cpo