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Study: When Researching And Buying, Auto Intenders Put Local Dealership First.

Auto dealers remain the centerpiece of the car-buying experience, according to a study conducted for Cumulus Media/Westwood One of Dallas-Ft. Worth auto buyers.

The survey of 600 recent auto buyers conducted from March-April 2023 by MARU/Matchbox consisted of 285 consumers who had purchased or leased a vehicle in the past year. In addition, 442 consumers who plan to buy a vehicle in the next 12 months were also surveyed. Some 127 respondents were both prior year purchasers and auto intenders in the market for another vehicle in the next year.

Despite all of the online purchase options, more than three in four (77%) of prior year new car buyers purchased from an auto dealer while 23% used an online car retailer or an online marketplace. In addition, the majority of auto intenders said they plan to buy from an auto dealer.

The study showed the dealer website and the dealer showroom to be the most used auto shopping research tools. Among those who purchased new or used vehicles in the past year, 49% researched their purchase in person at a dealer and 41% reviewed dealership websites. A third of purchasers consulted family or friends.

“You see a lot of the national websites that people use to research but the top two are local dealers, both the in-person experience as the number one research process, as well as the website of the dealer,” said Cumulus Chief Insights Officer Pierre Bouvard in a video summary of the study’s findings. “The dealer location and the website are the top two research platforms for auto shoppers.”

Validating the adage, “You have to be known before you’re needed,” four out of five prior purchasers who bought from a dealership were aware of the dealership before their purchase. That follows a Nielsen study conducted in Los Angeles in 2016 that found 90% of people who say they intend to purchase an auto brand could already name the brand on an unaided basis. Bouvard said this finding illustrates “the super important brand building necessary to make consumers aware and feel positively about your dealership before someone actually comes in market because it looks like the vast majority of the transactions are coming from dealers that they already were previously aware of.”

Underscoring the importance of the dealership in the car purchase funnel, the survey found that as purchasers get further into the sale process, they want to complete steps at the dealer. Although some prior year purchasers and auto intenders said they would like to complete car-buying steps online, in-person interactions increase as the shopper gets closer to purchasing, Bouvard says in a Westwood One blog post about the study.

The research also concludes that AM/FM radio reaches more vehicle buyers than television and that AM/FM radio listeners are 25% more likely to be auto intenders than TV viewers. “That's why radio impressions are worth 25% more when it comes to auto intenders than TV,” Bouvard reasons. “Pound for pound, radio listeners are 25% more likely to be in the market now.”

The study results are being published as American car shoppers have been flocking to dealerships so far this year, shaking off concerns about rising interest rates and inflationary pressures. With dealer supplies returning and supply chain issues subsiding, the auto industry is expected to have notched a 12%-to- 14% rise in new vehicle sales for the first half of this year, a pace far ahead of industry forecasts heading into 2023.

Using the media planning tool Nielsen Media Impact, the researchers found that a 20% reallocation of a local dealership’s TV spend to broadcast radio increased reach by 31% among 25-54 auto intenders. “Radio brings you the new people that are under the age of 60, the auto intenders that you're never going to reach on TV,” Bouvard explains. Reallocating 20% of the TV budget to radio delivered a 22% increase of 45-54 auto intenders, a 40% increase in 35-44 auto intenders and an 80% increase in 25-34 auto intenders. “Radio does a wonderful job of complementing and supplementing the TV buy with auto intenders under the age of 60,” Bouvard concludes.

Download the study’s findings HERE.

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