Capgemini Cars Online 1009

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<ul><li> Automotive the way we see it Cars Online 09/10 Understanding Consumer Buying Behavior in a Volatile Market </li> <li> Contents Introduction 2 Executive Summary 3 Developing Markets: Buying Trends Evolve Rapidly 5 How Consumers Buy: Target Your Marketing Mix 8 Green Vehicles: A Force for the Future 11 The Role of the Web: Consumer Usage Pattern Emerges 14 Online Buying: No Hassles, No Negotiations 17 Customer Interaction: Loyalty and Satisfaction Rates Improve 20 Aftersales/Servicing: Focusing on the Post-Sale Experience 24 Conclusion and Recommendations 27 </li> <li> Automotive the way we see it Introduction Mergers and acquisitions. Bankruptcy This years report focuses on both filings. Government intervention. mature and developing markets. The Vehicle scrapping and rebate research involved more than 3,000 programs. The past 12 months have consumers in Brazil, China, France, brought fundamental changes to the Germany, India, Russia, the United automotive industry around the globe. Kingdom and the United Sates. Last year ushered in an unprecedented In this edition we take a deeper look global downturn that originated in at top-of-mind issues such as online 2007. What started as a financial buying of vehicles and crisis soon expanded into the larger parts/accessories, alternative-fuel economy, affecting mature and vehicles and aftersales/servicing. In developing markets alike. The addition, we asked consumers to automotive industry has been one of think about the biggest changes they the hardest-hit sectors. The downturn expect to make in how they shop for has led most automotive businesses to and buy vehicles in the coming years. put in place initiatives aimed at short- Their responses provide valuable term survival and mid-term stability insight into consumer expectations with the focus largely on cost cutting about the future of the vehicle buying and cash preservation. Tomorrows process. Look for their direct quotes winners, however, will shift their throughout the report. focus to longer-term prosperity with the emphasis on future differentiation We hope that the findings of Cars and competitive advantage. Online 09/10 will provide automotive manufacturers and dealers with To achieve this objective and regain insights into changing consumer their footing, automotive companies dynamics in both mature and must have a deep understanding of developing markets, and will help the consumer buying behavior. Cars industry gain a better understanding Online 09/10 Capgeminis 11th of consumer buying behavior in annual global automotive study todays turbulent climate. aims to provide insight into how consumers shop for vehicles, what leads them to buy and what they are really looking for from the full vehicle lifecycle experience. I believe the whole car industry will soon look very different. Those companies owned by the government and unions will be bust. Those that listen to the public and offer value, fair prices and the right features will prosper. U.S. consumer Cars Online 09/10 2 </li> <li> Executive Summary With vehicle sales suffering in most experts or other consumers in-market environment as the primary reason: markets today and automotive is an important trend, which grew 26%, up from 19% the previous year. companies focused on cost cutting strongly this year. Traditional This trend was particularly evident in and cash preservation, its easy to take information sources such as TV the U.S. your eye off the consumer. But, in a advertising remain important in climate characterized by volatility, developing countries, however, and Improvements in brand and consumer insight is more important than ever as buying behavior patterns should be part of the marketing mix. 4 dealer loyalty and overall satisfaction with the buying process evolve rapidly. How do car buyers Consumers want to buy vehicles bode well for the industry. With research vehicles? What types of cars are they looking for? What triggers 2 and parts and accessories online as they look for lower prices plenty of bad news for automotive companies these days, our research them to buy? Where and how do and an alternative to the traditional uncovered a bit of good news. More they want to buy? How do they want dealer model. Nearly 40% of than two-thirds of respondents said to communicate with manufacturers respondents said they would like to they were likely to purchase the same and dealers? buy a car over the Internet (the make/brand as their current vehicle, complete end-to-end process) and half up from 61% last year. Similarly, Capgeminis Cars Online research aims would buy parts and accessories. dealer loyalty also rose, with 63% of to answer these questions and more to While lower price is the leading consumers saying they were likely to provide insight that can help reason, many respondents said they purchase from the same dealer where automotive companies respond faster simply did not want to negotiate price they bought their current car, up from and more effectively to changing or interact with the dealer in person. 59% the year before. consumer needs and demands. Consumers seem to be polarized in their desire to negotiate: about one- Satisfaction with the overall buying Key Findings quarter wanted the ability to negotiate process was also up somewhat. The research uncovered a number of a better deal, but another one-quarter However, consumer approval was key findings: felt this was something they preferred more muted in the mature markets, to avoid. demonstrating that there is still work Usage of the web as a key to be done to improve the customer 1 information source during the vehicle buying process has become 3 Green vehicle ownership continues to rise as experience in the U.S. and Western Europe. pervasive across most markets. environmental concerns grow. Almost 90% of consumers today use Consumers indicate a growing Developing markets show early the Internet to research vehicles, up from 61% in 2005. A clear online confidence in their understanding of so-called green vehicles. This 5 signs of trending toward mature markets, as consumers in the BRIC usage pattern has emerged, with increased knowledge is influencing countries become more familiar consumers turning initially to search buying decisions. In this years study, with buying cars. For example, this engines, which jumped up the list of 41% of consumers said they currently year the gap between the factors that information sources this year; then to own a fuel-efficient or alternative-fuel impact vehicle decisions in mature vs. manufacturer and dealer sites for vehicle, up from 36% the year before. developing markets was much factual information about vehicles, Another 30% said they plan to buy a smaller. Greater convergence will prices and availability; and finally to fuel-efficient or alternative-fuel vehicle. likely still take a number of years, and consumer-to-consumer tools like market differences will remain for discussion sites for qualitative Interestingly, the reasons behind these some time. For instance, mature information and opinions. buying decisions are evolving. While markets increasingly look for fuel economy remains the leading information online, whereas The ability to interact online and hold driver, a growing number of developing markets are still keen to real-time discussions with automotive respondents named impact on the get information from more traditional 3 </li> <li> Automotive the way we see it Many of the formalities of car purchases will soon be a thing of the past. The selection and purchase process will be faster, easier and nicer. Russian consumer sources such as TV advertising and manufacturer to respond to an online trade shows. And mature markets inquiry within four hours. In China, focus on permanent value when consumers are even more demanding, choosing a vehicle, whereas with more than half expecting a developing markets show greater response within an hour. In addition, interest in more transactional almost one-quarter of respondents marketing such as cash-back bonuses. point to ease and speed of transaction as the key reason for buying a vehicle Now is the time for automotive online, and 30% say it is the driving companies to focus attention on factor behind their desire to purchase providing a positive customer parts and accessories over the web. It experience in developing countries is important to note that most of these About the Study while loyalty and satisfaction levels factors leading to consumer remain higher than in mature frustration seem to be down to poor markets. basic management and are in the Capgemini worked with SmartRevenue, industrys own hands to resolve. a Ridgefield, Connecticut-based As the duration of the vehicle 6 buying cycle contracts, automotive companies have less 8 Less than half of consumers with cars still in-warranty have research firm, to conduct the survey for Cars Online 09/10. All analysis and interpretation of the data has been time to influence purchases. their vehicles serviced at the made by Capgemini in collaboration Consumers today can quickly and purchasing dealership. This with the Car Internet Research Program easily get vast amounts of information represents a significant missed (CIRP) of the University of Ottawa, about the vehicles they are interested aftersales opportunity for dealers. Canada. In total, more than 3,000 consumers were surveyed in eight in, resulting in a shrinking buying And it may also impact repurchase countries: Brazil, China, France, cycle. What used to take six months is decisions, as consumers tend to be Germany, India, Russia, the United now likely to take only four, with more likely to buy their next vehicle Kingdom and the United States. showroom visits coming ever closer to from the servicing dealer rather than the point of purchase. More than two- the prior purchasing dealer. The composition of the consumer thirds of respondents begin the...</li></ul>