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90% buyers research online before showroom visit: How digital platforms affect car buying decision

72% of buyers decide the brand and about 49% close on the car model before a store visit- all based on online information, as mentioned in a recent Bain-Facebook study.

90% buyers research online before showroom visit: How digital platforms affect car buying decision

The internet is now a de facto tool for consumers to get information, compare and narrow down choices. Automobile purchases are no different. The automobile industry is currently going through turbulent times and is being reshaped by the power of digital media and changing consumer expectations.

As per a study by Kantar TNS, 90% of car buyers research online- even before they visit a showroom. This research and validation continue even when they are at a showroom, reducing the role of dealer’s sales personnel. More than half of buyers use third-party comparison sites to research all parameters, after which they close on the brands they consider. Except for the car variant, a decision on key parameters is taken with the help of online information.

72% of buyers decide the brand and about 49% close on the car model before a store visit- all based on online information, as mentioned in a recent Bain-Facebook study. Social Media is predicted by another study, to contribute almost 40% of auto-sales this year.

Digital advertising often gives more value for money. Last year, auto brands like Volkswagen, in a local digital campaign, saw a double-digit increase in inquiries, at almost half of the usual print investment. The ability of digital media to push and influence awareness and sales especially in hyperlocal markets is noteworthy.

Videos are becoming a major contributor in the pre-purchase research phase.80% of buyers watch online videos of test drives, walkarounds, demos, opinion vlogs, etc. Consumers are now watching a range of colours, styles, interiors, technical aspect and even test drive experience- all online. Videos are also pushing consumers to act. The majority of consumers contact a dealer or visit the brand’s website, after watching a video. Videos, among all digital media, are the most influencing factor in the process of purchase of an automobile. Search and independent comparison sites being the top two online influencers.

It’s not only the purchase, but even the post-purchase decision making is getting influenced by digital. The same study by Bain, highlights the increasing number of consumers are relying on digital channels for making post-purchase services. Digital advertising is predicted to become responsible for almost 30% of accessories and services purchased this year. Keeping this in mind, auto accessories brands should communicate more frequently online with consumers. With the increased efficiency of data and analytics, synchronization between auto and accessories brands can make purchase experience more seamless. Product digitalisation is becoming important to drive consumer experience and engagement.

Another study by Deloitte points out at the amount of time Indians spent online for research, which is a staggering average of more than 10 hours. Considering how much of the purchase journey is already digital, it’s highly possible that in the near future actual vehicle purchases may be online too.

Also read: How India’s used car market is beating the economic slowdown

The rising level of comfort in ridesharing and vehicle hiring across markets is often credited to digital media. App-based vehicle hiring services along with improved public transports has impacted the desire to ‘own’ a vehicle. It’s not surprising that many millennials question the reason for buying a vehicle. There are increasing instances of car owners, preferring rental services for a commute. Consumer expectations are rapidly changing. Smart in-car digital technology about entertainment, connectivity, mobility and safety along with new emissions norms are expectations of potential buyers. Highlighting these aspects -online- is becoming key to grabbing attention.

Digital media, in India, is poised to grow at a rate of 30% year on year and will overtake print media, according to industry reports by WPP-owned media agency, GroupM. With such strong growth, reach and impact digital media has become imperative in auto-marketing. Automobile brands must strike a balance between digital and experience-based marketing to connect seamlessly with potential buyers.

It’s evident that when it comes to buying a vehicle, consumers prefer digital first. Digital is now the critical influencer in automobile marketing and will continue to be so in the future.

Author: Prateek Kumar, MD & CEO, NeoNiche Integrated Solutions

Disclaimer: The views and opinions expressed in this article are solely those of the original author. These views and opinions do not represent those of The Indian Express Group or its employees.

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