If you’re looking to market your high-tech vehicles, the customers most interested consume three key forms of media at considerably strong rates.
According to a recent J.D. Power report, those media — Internet, television and magazines — are consumed at very high rates by consumers shopping with in-vehicle technology in mind.
The J.D. Power 2015 U.S. Automotive Media and Marketing Report – Summer, fueled by a nationwide survey of 28,983 principal drivers of recently purchased or leased new vehicles (acquired between November 2013 and October 2014), takes a look at where shoppers interested most by technology in their cars consume their media and discovered the following statistics:
- 43 percent of new premium brand drivers and 28 percent of new non-premium brand drivers attributed their vehicle’s technology as one of the reasons they bought it.
- Of the new-vehicle drivers that bought their ride based on its technology, 69 percent access the Internet via smartphone and 54 percent via tablet – vs. 63 percent and 46 percent, respectively, who did not cite in-car technology as a reason for their car choice.
- New-vehicle drivers that chose their vehicle based on technology spend more time on the Internet for personal use, watch more television and read more magazines than those not seeking a vehicle based on its technology. Tech-savvy drivers are more likely to read a magazine via an app than those who chose their vehicle for other reasons (33 percent vs. 27 percent, respectively).
Arianne Walker, the senior director of automotive media and marketing at J.D. Power, points to tech-based advertising as the best way to attract tech-savvy shoppers.
“It’s important that auto manufacturers promote the technological virtues of their vehicles to consumers via the media they consume,” Walker said. “Targeting these technology seekers with the right messaging is critical to using marketing dollars efficiently to reach consumers who will actually buy new vehicles because of new technology.”
So what does the average tech-savvy shopping demographic tend to look like? As it turns out, there really isn’t a specific age bracket that outweighs the others in the area of primary tech interest — roughly a third of all new-car shoppers chose their vehicle based on its technology offerings. Here are J.D. Power’s findings in the report:
- 31 percent of men and 28 percent of women said one of the reasons they bought their new vehicle was due to it having the latest technology features.
- Looking at specific age groups, the following percentages of people chose their vehicle based on its tech features: 34 years and younger (31 percent), 35 to 54 years of age (28 percent), and 55 years or older (31 percent).
Here are a few more interesting findings about tech-savvy shoppers from the report:
- Brands with the most tech-focused shoppers include both premium brands (Lincoln, Infiniti, Cadillac and Audi) and non-premium brands (Mazda, Buick and Chrysler).
- They watch an average of 33 hours of television each week. Their favorite shows? “The Walking Dead,” “The Big Bang Theory” and “The Voice.”
- Tech-seeking drivers read an average of nine magazines, with a high rate of focus on topics such as wealth, science/technology and travel.
Even though not everyone cited technology as a primary reason for their purchase, new-car buyers, in general, are also increasing their levels of media consumption, albeit not quite to the extent of the tech-focused group.
- New-vehicle buyers read an average of eight magazines, with the biggest increased in the last year focusing on topics such as business/personal finance, wealth, men’s lifestyle/fitness/outdoor, travel, and women’s lifestyle.
- Younger new-vehicle drivers watch less television per week than older drivers: 34 years and younger (20 hours), 35 to 54 years old (24 hours) and 55 years and older (35 hours).
- Nearly 70 percent of new-car drivers utilize social media via websites or applications; Facebook was the most popular, followed by LinkedIn and Pinterest.
Those interested in sharpening their auction skills can look forward to an upcoming National Auto Auction Association standards training event in Michigan next month.
The upcoming NAAA Auction Standards Training Program will feature two days of classroom and hands-on training for vehicle inspectors, operations managers, account coordinators, arbitration managers or anyone else interested in enhancing their knowledge on vehicle inspections and arbitration trends.
The upcoming event will be hosted by the Grand Rapids Auto Auction in Jenison, Mich. on Aug. 19 and Aug. 20.
Auto Remarketing recently attended an Auction Standards Training event near our home office at ADESA Charlotte. Check out the full story here.
Here’s a breakdown of what you can expect to learn about during the upcoming event, according to the NAAA:
Day 1
- Condition reports
- Estimates for reconditioning
- Inspection and mechanical basics
- Prior repairs
- Vehicle sections
- Interiors
- Flood and hail damage
- Restraints
- Vehicle grading
- Collision estimating guidelines
Day 2
- Structural damage policy
- Identify correct structure type
- Prior structural repairs
- Collision dynamics
- What is considered structural damage?
- What is not structural damage?
Sound interesting to you? You can find more information and register here.
The National Automobile Dealers Association announced today its fierce opposition of an amendment potentially headed for the Senate floor this week that would prohibit the retail sale of used vehicles with an open recall.
The NADA as well as the American International Automobile Dealers Association and the National Association of Minority Automobile Dealers sent a joint letter to their senators on Monday to urge them to vote against the proposed amendment.
According to the NADA, the amendment in question was officially filed by Sen. Richard Blumenthal (D-Conn.) and may come to the Senate floor for a vote as part of the transportation bill being voted on this Thursday.
In the letter, the three organizations argued that the proposed legislation would “instantly diminish the value of millions of customer trade-ins while not guaranteeing that a single recalled vehicle gets fixed.”
The organizations speculate that dealers would be less likely to accept trade-in offers due to the knowledge that they would have to sit around until a recall remedy could be found, thus causing many trade-ins to be declined and forcing consumers to sell their vehicles in the private market and further perpetuate the putting off of recall repairs.
The organizations estimate that between 250,000 and 500,000 sales of new vehicles would be lost per year due to consumers being unable to trade in their vehicle.
In a previous discussion with Auto Remarketing, vAuto founder Dale Pollak echoed this opinion.
“The responsibility of checking and remedying open recalls for all used vehicles prior to sale is an excessive and unreasonable burden to dealers,” Pollak said. “This is because dealers frequently do not possess the resources, expertise and/or parts to make the necessary repairs. Moreover, this situation is exacerbated in light of the fact that dealers cannot practically refuse trade-ins on the purchase of new vehicles.
“These trades represent a significant portion of the customer’s payment, and therefore, the receiving dealer must have the ability to turn the trade quickly in order to convert the asset to cash,” Pollak continued. “The inability to do so as a result of the proposed legislation will likely deny all dealers the necessary capital to sustain operations.”
To check out the full letter submitted by NADA, AIADA and NAMAD to their senators, click here. To check out commentary on the topic from NADA Chairman Bill Fox, click here.
Imagine what would happen if dealers could only offer a fraction for their customer's trade-ins, or could not even send the trade-in vehicle to auction. This could be a dark reality if the Sen. Richard Blumenthal (D-Conn.) used car amendment, which would ground all recalled vehicles at dealerships until remedied, is passed.
When a food recall is issued, the product under recall is immediately removed from commerce and tossed from retail shelves. This is not the way it works for a recall involving automobiles. When a particular vehicle is under open recall, that doesn't necessarily mean it requires the drastic step of grounding the vehicle. While there are at least 46 million vehicles currently under open recall, the truth is many recalls don't require the vehicle being taken out of service. Furthermore, recall notices are often issued even though there is nothing an owner or dealer can do to resolve the problem because of a lack of auto parts.
And some recalls are due to minor causes, such as a printing error in the owner's manual.
The Blumenthal amendment to the highway bill (H.R. 22) currently being considered by the Senate proposes to ground all used vehicles sold at a dealership under open recall. (Private sales would remain unregulated.) The amendment would effectively slash the trade-in value of some recalled vehicles while removing cars from the road needlessly, and the reason could be for something as minor as a warning sticker that may peel off the sun visor. This amendment would cripple the used-car market, leaving consumers with diminished trade-in values or fewer options because cars would be grounded indefinitely until parts became available. This would be devastating for consumers, dealers and automakers.
Franchised auto dealers play a critical role in ensuring that recalled vehicles are repaired.
Proposals that ground all vehicles under open recall at a dealership miss the mark: they don't differentiate between recalls involving a serious defect and those with a negligible impact on safety. Time and time again, they prove to be overly broad measures that do not require the drastic step of grounding cars. A recent survey of 2,100 vehicle recalls revealed that 80 percent of them do not come with any recommendation from the manufacturer or the National Highway Traffic Safety Administration to stop operating the vehicle.
NADA is advocating for a better solution. A more viable approach would be to improve the recall process by differentiating between truly dangerous defects in which vehicles should be immediately taken off the road versus trivial issues where there is no harm to driver safety or the public good.
Policies should be tailored to boost consumer recall response and completion rates. The average vehicle recall completion rate is 75 percent. America's dealers support a 100 percent completion rate and we urge NHTSA to improve the recall process by designing a database that handles multiple VIN requests as a single inquiry.
Dealers should call their Senators today at 202.224.3121 and tell them to vote “No” on Sen. Blumenthal's ill-conceived amendment. This amendment would diminish in an instant the trade-in value of millions of vehicles, while not guaranteeing one recalled vehicle gets fixed.
Bill Fox is 2015 NADA chairman and a multi-franchise dealer in upstate New York.
Used-car dealers won’t have to worry about a federal requirement of bearing the burden of fixing recalls before being allowed to resell used vehicles. At least, for now.
This is in light of a Senate Committee on Commerce, Science, and Transportation mark-up meeting on Wednesday that voted on several legislative actions attempting to alter operations in various areas of the United States’ transportation sector, including highway, rail and port-related issues.
While many areas of transportation in the U.S. will be affected, the key takeaways for used-car dealers are as follows.
The committee passed S. 1732, a multi-year transportation bill including multiple amendments that the committee says offers critical regulatory and consumer protection reforms. As we reported a few days ago, the Republican-driven bill will directly affect franchised dealers and car rental companies by requiring them to provide consumers with notification of open safety recalls.
The Democratic amendment proposed by senators Ed Markey (Massachusetts), Bill Nelson (Florida) and Richard Blumenthal (Connecticut) that would require used-car dealers to repair recalled vehicles prior to their resale was shot down by the committee.
That same amendment would have also required dealers to check for and fix safety defects subject to open recalls, with customer permission, when such vehicles were taken in for routine maintenance. Per the specific wording of the amendment, the auctioning of used-vehicles would be exempt from repair requirements.
Sen. John Thune, the Republican senator from South Dakota and chairman of the committee that sponsored the bill that passed showed his hesitations toward the Democrat-sponsored amendment that would specifically require used-vehicles to be repaired prior to their sale by a dealer.
“Just let me say in response that requiring used-car dealers to remedy any open recall prior to sale could have unintended consequences, negative consequences, for consumers in the used-car market,” Thune said. “Cars would sit on used-car lots for potentially long stretches of time before the used-car dealers could get them repaired as used-car dealers would not be a recall-repair priority for franchised dealers.
“Used-car dealers would also likely be reluctant to accept trade-ins or otherwise purchase cars from consumers with open recalls even from minor defects because they would have to repair the car before it could be resold. I appreciate the intent of this amendment, and I’m open to continuing to work on the issue, but I don’t think we have addressed the potential implementation issues so I’m going to vote no at this time and would urge my colleagues to do the same.”
Washington-state Democrat Sen. Maria Cantwell spoke in defense of the legislation, bringing into the conversation the lives that have been lost due to used vehicles sold with unrepaired recalls.
“New-car dealers cannot sell vehicles under recall, but used-car dealers can,” Cantwell said. “So this presents a real danger to the public. In fact, several individuals who died from exploding Takata airbags purchased used cars that hadn’t been fixed. So consumer safety requires corporate accountability — this would also have accountability from third-party vendors, and I think this amendment would help achieve that.”
At the closing of the mark-up session, Blumenthal addressed Thune and lightly expressed his dissatisfaction with the speed of the processes involved with various issues related to the various amendments he tried to get passed.
“Thanks Mr. Chairman. I want to join in thanking for adopting the measures that you did and express the hope that we can reach agreement on some more,” Blumenthal said. “I think that there is always a tendency to articulate what happens here as overly simplistic terms. Essentially I think that we’ve taken some steps, they strike me as baby steps, in the right directions when we should be making giant strides given the absolutely gut-wrenching, heartbreaking stories we’ve heard in this very room about the real-life consequences of safety lapses and gaps in our present laws. I’m hoping we can correct some of them. Thank you.”
A recent research study conducted by Blackhawk Engagement Solutions shed light on several aspects of automotive shoppers around the country, revealing that many use their smartphones to compare prices. And the majority use retail websites as one of their top sources for comparing prices on automotive products.
Looking at the specifics of the “Where It’s At: A Connected Shopper Study,” 47 percent of the 2,608 adults surveyed from every region of the United States by Blackhawk, on a range of topics, said that they utilize their smartphone to compare the prices of auto products.
Interestingly, when posed with a scenario of purchasing four tires for $500, 60 percent said they would prefer a $125 rebate compared to 40 percent that said they would prefer an $85 instant discount.
Rodney Mason, the company’s global vice president of marketing, commented on the changing nature of shopping.
“Gone are the days of retailers only worrying about keeping up with their competitors,” Mason said. “Today, the key to winning at retail is keeping up with your customers. By charting where shoppers are landing as they explore new shopping territories, retail marketers can position their business in front of the competition and closer to targeted and underserved customers.”
The shopper study also featured a handful of other automotive-shopping related revelations, including the following sources that automotive shoppers surveyed rely upon the most for purchasing automotive products of varying types:
Top 3 sources for comparing prices
- 59 percent – retail websites
- 47 percent – in-store displays
- 43 percent – Google
- 41 percent – Amazon
- 29 percent – print ads
- 28 percent – TV/radio
- 25 percent – value shopper sites
- 14 percent – social media
- 10 percent – mobile apps
- 5 percent – billboards
To check out the entire “Where It’s At: A Connected Shopper Study,” click here.
The TPC Management Co.’s continuing education program for auction professionals, Auction Academy, has hosted two successful classes in the first half of the year and has two more scheduled in the next two months.
The program, designed to enhance essential skills sets, promote best practices and yield better auction performance, will host a session for “Class 4” in Spokane, Wash., next week (Monday through Thursday). The fourth class of the year will be hosted by DAA Northwest in conjunction with its 20th Anniversary Rock & Roll Sale.
Meanwhile, a session for Class 3 will be hosted August 27 through August 29 at Brasher’s Salt Lake Auto Auction.
TPC recently wrapped up hosting both the Class 3 and Class 4 groups jointly in the Baltimore area at the end of April, beginning with presentations by Todd August of Avis/Budget Remarketing and Frank Hackett, the chief exetcutive officer of the National Auto Auction Association. The group then traveled to the NADA headquarters in McLean, Va., for a version of the NADA Dealer Academy before being hosted to dinner by BSC America executives and Bel Air Auto Auction staff members in Annapolis, Md.
David Pendergraft of DAA Northwest reflected on his experience at the combined session as a member of the Auction Academy’s Class 4 group.
“The training offered by Auction Academy is a tremendous benefit to anyone who wants to expand their knowledge and understanding of the auto auction business, whether they’re new to the industry or a seasoned veteran,” Pendergraft said. “No other program provides the opportunity to intimately learn from our industry’s key executives, offer in-depth operational walkthroughs with auction pioneers like Mr. Ray Nichols, or help build lifetime connections with other auction leaders. The value of the education Auction Academy provides is priceless, to both the individuals undergoing the training and by extension the companies for which they work.”
Auction Academy also plans to introduce a shorter, more intense Seminar Series to focus on a specific discipline related to remarketing and the auction industry. The first of these events, titled as Digital Managers Session, is scheduled for July 27 and 28 in Chicago.
“We had been discussing for some time the need in our industry for shorter, more focused sessions that bring together managers from specific disciplines, in contrast to the regular two-year Academy program which takes a broader approach, covering many topics and areas,” said Pierre Pons, the program’s chief executive officer. “The response to this initial Digital Managers Session has been overwhelming; not only did the session quickly sell out, but now stands at 30 percent more participants than we had originally anticipated. I look forward to the interaction of representatives from some 30 independent auctions on this session’s very timely focus to internet remarketing and its impact on our industry.”
For more information on Auction Academy, visit its site here.
Long gone are the days where a dealership could adequately maintain its inventories by utilizing traditional methods of vehicle acquisition alone. That’s according to the folks at Autotrader, who hosted the company’s Interactive Dealer Summit in the North Carolina capital last Thursday.
One of the workshops for dealers at the event, titled “The Frond-End Fundamentals: Transforming the Art of Selling to the Science of Results” was presented by Glenn Pereira, Autotrader’s manager of industry education.
Pereira hit on what the company sees as the eight key areas that successful dealerships should focus on the front end of the vehicle sales process, from vehicle selection all the way to customer handling. One topic during the event proved particularly poignant: dealers can’t stay in a selling-only mindset.
“You can’t afford to only sell cars,” Pereira said. “You need to be in the business of buying cars, as well.”
This statement, made while discussing the vehicle acquisition process, resonated well with the dealers in attendance at the event. Pereira went on to break down the traditional and non-traditional methods of vehicle acquisition.
He explained that a good acquisition strategy involves pursuing every avenue possible. In addition to more traditional methods, like vehicle trade-ins and auction purchases, Pereira heavily emphasized the use of more non-traditional acquisition methods, such as a car-buying campaign or a “trade-in marketplace” on the dealer’s own website.
“It’s a good plan to have a buying center without the contingency of selling them a car,” Pereira said.
Autotrader says its most successful customers advertise their car-buying intentions separately and in addition to their own vehicle sales. While some dealerships have an acquisition manager on staff, some of the larger groups will even have an entire acquisition team dedicated to targeting ideal inventory.
For more information and further Autotrader advice on the acquisition process, visit its site here.
Is your dealership ready for this coming October’s fraud liability rules to take effect?
Are you well versed in EMV (Europay/MasterCard/Visa) chip card acceptance?
If not, then you may want to jot down the time and date of the American International Automobile’s Dealers Association’s upcoming Webinar.
The next AIADA Autotalk Series webinar, presented by Wells Fargo Dealer Services, will focus on preparing your dealership for the October fraud liability shift, a new intative that employs EMV chip technology to cut down on in-store fraud.
The webinar, titled “Preparing for EMV Chip Card Acceptance,” is scheduled for June 16 at 10 a.m. EDT and again at 4 p.m. It will be hosted by Ben Brown, vice president and regional sales manager at Wells Fargo Merchant Services.
The Webinar is designed to help dealers understand coming changes impacting payment acceptance for merchants, including the latest on EMV chip cards, EMV-enabled readers, and NFC (near field communication) contactless payments including Apple Pay.
The below items will be discussed in detail:
- The importance of layered security: Learn about implementing multiple layers of security including EMV chip card technology, encryption, tokenization and PCI compliance to help protect customer data and your business.
- EMV chip card acceptance: Find out more about the benefits of accepting EMV chip cards including data security, reduced counterfeit fraud, reduced merchant liability and expanded payment acceptance.
To register for the 10:00 a.m. EDT session, click here.
To register for the 4:00 p.m. EDT session, click here.
For information on upcoming webinars in the AutoTalk series, click here.
Manheim is currently hosting a national promotion, titled “Pump Up Your Volume,” that is aimed at aiding dealers in their inventory building efforts to prepare for the impending selling season.
The national promotion, expected to drive traffic at all of Manheim’s 79 wholesale auctions, will include offers from DealShield and Ready Auto Transport via a national email campaign. The promotion will also include daily prizes, including a grand prize — a guitar signed by Aerosmith.
The campaign started Monday and runs to May 3.
“We want to promote the message to dealers that Manheim is where you’ll find the right inventory to win at your lot,” said Stephen Smith, senior director of customer marketing at Manheim. “We are the go-to source for both the volume and the variety of vehicles that dealers need to drive traffic to their lots and ultimately sell more vehicles.”
More information can be found on the Pump Up Your Volume website.
Upcoming Wholesale Webinars
- The National Auto Auction Association will host its webinar on the 2015 Arbitration Policy Updates on two different dates: Friday (at 2 p.m. EST) and Monday (also at 2 p.m. EST). Each webinar will last approximately 45 minutes, featuring Matt Arias, the auction standards committee co-chair at NAAA, who will review the updates to the NAAA Arbitration Policy that take effect on May 4. Registration links are above; to review the updated arbitration policy, click here.
- AIADA and ADESA will host a free webinar, “Buy and Sell Wholesale … Without Leaving Your Desk!” on Tuesday, April 21 at 10 a.m. EST and again at 4 p.m. EST. The webinar is designed to provide an in-depth overview of “real life” wholesale inventory management solutions. To register, click the corresponding time you are interested in above.
