Web Originated Dealer Walk In Traffic

Objectives Northwood University and AutoTrader.com Present: 2008 Dealer Walk-In Traffic Study Results January 25, 2009 1

Chip Perry – President and CEO, AutoTrader.com 2

State of the Industry - Current Observations • Since the advent of the Internet, manufacturers and dealers continue to seek the most effective and efficient media strategy. • Traditional media continues to garner a large share of advertising spend. • Automotive advertisers often treat the Internet as a lead- generator and define its impact based on e-mails and phone calls alone. 3

State of the Industry - Current Observations Yet, e-mail leads have stagnated over the last several years. 80% 75% 75% 71% 71% 6 % 67% 68% 68% 64% 64% 60% 40% 20% 21% 21% 21% 22% 22% 22% 22% 20% 20% 0% 2004 2005 2006 2007 2008 Online New Car Shopper as % of Total Buyers Email Lead Requestors as % of Total Buyers Source: JD Power 2004-2008 New AutoShopper.com Study 4

Why conduct the “Dealer Walk-In Traffic” Study? • To better understand the “missing link,” what was previously immeasurable: The impact of advertising on the volume of walk-in traffic at dealerships nationally nationally. 5

Objectives Keith Pretty – President, Northwood University 6

Study Objectives Specific Objectives • D t Determine h i how walk-in t ffi initially establishes contact lk i traffic i iti ll t bli h t t with dealerships (i.e., phone, e-mail or walk-in). • Measure the impact that all forms of advertising have on dealer walk-in traffic. 7

How did we conduct this study? Methodology • Intercept interviews conducted among customers as they exited the dealership. dealership • Interviews administered by research firm Morpace, Inc. and Northwood University students. • Interviews were conducted over a two-day period at each dealership. Sample • Must have been visiting the dealer to shop for a vehicle (Those visiting for service or to make a car payment were not included in this study). • Data has been weighted to reflect the actual market * market. * Geography weights determined by population; Customer type weights determined by share of units sold 8

Where did we conduct this study? • 59 dealerships (mix of manufacturers, independent and franchise, luxury and non-luxury) • 17 markets Eugene, OR Boston, MA Syracuse, NY La Crosse, WI Detroit, Detroit MI Reno, NV Philadelphia, PA Chicago, IL Sacramento, CA Denver, CO Kansas City, KS Richmond, VA Louisville, KY Phoenix, AZ Macon, GA Austin, TX Tampa, FL 9

The Focal Point Question of the Survey What was the primary source that led you to visit this dealership today? 10

How do walk-ins establish contact with the dealer? • 80% of car shoppers who walk through a dealership’s doors do not establish contact with the dealer prior to their initial visit. Dealers’ Perception Reality Phone 17% Walk-In Email Walk-In Walk In 80% 2% 41% Phone 42% Email 17% Source: 2008 Dealer Brand Image Study & Dealer Walk-In Study 11

What are the primary sources that drive dealer walk-in traffic? Primary Source Leading to Dealership Driving by 31% Advertising drives Advertising 27% over one-fourth of dealer walk-in traffic Prior Experience 22% Friends or family 20% Source: 2008 Dealer Walk-In Study 12

What advertising drives dealer walk-in traffic? • The Internet is the number one media source driving dealer walk-in traffic. • More than half of all walk-in traffic generated by advertising can be attributed to the Internet. Dealers’ Perception Reality Internet 32% 54% Newspapers 27% 13% Classified Maga ines Magazines 11% 15% Radio 9% 4% Television 8% 8% Direct Mail 7% 3% Outdoor Advertising 6% 0% Phone Book 0% 3% Source: 2008 Dealer Brand Image Study & Dealer Walk-In Study 13

What advertising drives dealer walk-in traffic? • Of the 54% brought to the dealership by the Internet, 61% do not contact the dealership first. Internet 54% Newspapers 13% Walk-In Classified Magazines 15% 61% Phone 25% Radio 4% Television 8% Direct Mail 3% Email Outdoor Advertising 0% 14% Phone Book 3% Source: 2008 Dealer Walk-In Study 14

It’s important to invest in efficient and effective media. • The Internet is the number one media source at driving walk-in traffic. However, dealers are still spending heavily on more traditional media such as Newspaper, Radio and TV. 54% Internet 17% 13% Newspaper 27% 8% Primary Media Source Leading to Dealership TV 17% Dealer Advertising Spend 4% Radio 17% 3% Direct Marketing 10% Source: 2008 Dealer Walk-In Study & NADA Data 2008 Report. 15

Objectives Thank You! 16

Web Originated Dealer Walk In Traffic

by Ralph Paglia on Oct 22, 2009

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Web Originated Dealer Walk In Traffic — Document Transcript