If you look through any marketing articles on the automotive industry in the last 12 months, you could come away with the impression that traditional bricks and mortar dealerships are a thing of the past and the only thing that manufacturers and dealers need to have is a Twitter account since, one might think, customers are more than willing to shell out $30k to #buycarnow.
I’m not convinced the data back that argument up. Just before I’m accused of being a Luddite, my reasoning is not based on fancy but hard facts.
In both the US and Canadian versions of the New Vehicle Customer Study (NVCS), which are the largest automotive studies in North America, we ask customers what sources of information they found most influential in their buying decision. For the US in the last five years, the top 10 sources are found below. I did significance testing comparing all of the columns vs. the 2011 results. A red cell indicates a value statistically lower than 2011; a green cell indicates a statistically higher value vs. 2011.
I think there are some pretty important findings here:
1. Because of the complexities in buying a car, the salesperson at the dealership is the most influential information source and it’s significantly higher in 2011 vs. the other years. Despite the prevalence of social media, they are still the #1 source. People buy from people
2. In the same vein, people recommend people. What our family and friends say or recommend to us is important. Therefore, WOM is absolutely essential as a positive source of information in the vehicle buying decision. It’s statistically higher in the US compared to other years and in Canada, it’s higher than what it was in 2010; it’s interesting to note that the influence of Family and Friends is down from the levels in 2007 to 2009.
3. Consumer guides e.g., Consumer Reports, are still #3 as an influential source of info, but it’s significance is lower compared to 2007 to 2010. Other sources of info seem to be taking on more prominence.
4. Websites – Dealer & manufacturers’ sites are statistically more significant in 2011 vs. other years. This is not too surprising considering the plethora of info that is available. The sites are also getting a lot better so customers don’t have to necessarily go into a dealership to get all of the pertinent pricing and product information. They can go online and save time and effort in the process.
Please don’t misunderstand what I’m saying. Every manufacturer needs to have a well defined social media strategy. That’s clear. However, we still need to remember the human interaction is price of entry in buying a car. Social media can certainly support the selling effort but I believe it would be a mistake to believe that it will usurp it. And that’s not going to change anytime soon.