2008 Dealer Walk-In Traffic Study Results
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1 Objectives Northwood University and AutoTrader.com Present: 2008 Dealer Walk-In Traffic Study Results January 25,
2 Chip Perry President and CEO, AutoTrader.com 2
3 State of the Industry - Current Observations Since the advent of the Internet, manufacturers and dealers continue to seek the most effective and efficient media strategy. Traditional media continues to garner a large share of advertising spend. Automotive advertisers often treat the Internet as a leadgenerator and define its impact based on s and phone calls alone. 3
4 State of the Industry - Current Observations Yet, leads have stagnated over the last several years. 80% 71% 75% 67% % 68% 64% 60% 40% 20% 20% 21% 21% 22% 22% 20% 21% 21% 22% 22% 0% Online New Car Shopper as % of Total Buyers Lead Requestors as % of Total Buyers Source: JD Power New AutoShopper.com Study 4
5 Why conduct the Dealer Walk-In Traffic Study? To better understand the missing link, what was previously immeasurable: The impact of advertising on the volume of walk-in traffic at dealerships nationally. 5
6 Objectives Keith Pretty President, Northwood University 6
7 Study Objectives Specific Objectives Determine how walk-in traffic initially iti establishes contact t with dealerships (i.e., phone, or walk-in). Measure the impact that all forms of advertising have on dealer walk-in traffic. 7
8 How did we conduct this study? Methodology Intercept interviews conducted among customers as they exited the dealership. Interviews administered by research firm Morpace, Inc. and Northwood University students. Interviews were conducted over a two-day period at each dealership. Sample Must have been visiting the dealer to shop for a vehicle (Those visiting for service or to make a car payment were not included in this study). Data has been weighted to reflect the actual market. * * Geography weights determined by population; Customer type weights determined by share of units sold 8
9 Where did we conduct this study? 59 dealerships (mix of manufacturers, independent and franchise, luxury and non-luxury) 17 markets Eugene, OR Reno, NV Sacramento, CA Denver, CO Boston, MA Syracuse, NY La Crosse, WI Detroit, MI Philadelphia, PA Chicago, IL Kansas City, KS Louisville, KY Richmond, VA Phoenix, AZ Macon, GA Austin, TX Tampa, FL 9
10 The Focal Point Question of the Survey What was the primary source that led you to visit this dealership today? 10
11 How do walk-ins establish contact with the dealer? 80% of car shoppers who walk through a dealership s doors do not establish contact with the dealer prior to their initial visit. Dealers Perception Reality Walk-In 41% Phone 42% Walk-In 80% Phone 17% 2% 17% Source: 2008 Dealer Brand Image Study & Dealer Walk-In Study 11
12 What are the primary sources that drive dealer walk-in traffic? Primary Source Leading to Dealership Driving by 31% Advertising 27% Advertising drives over one-fourth of dealer walk-in traffic Prior Experience 22% Friends or family 20% Source: 2008 Dealer Walk-In Study 12
13 What advertising drives dealer walk-in traffic? The Internet is the number one media source driving dealer walk-in traffic. More than half of all walk-in traffic generated by advertising can be attributed to the Internet. Internet Dealers Perception 32% Reality 54% Newspapers 27% 13% Classified Magazines 11% 15% Radio Television Direct Mail Outdoor Advertising Phone Book 9% 8% 7% 6% 0% 4% 8% 3% 0% 3% Source: 2008 Dealer Brand Image Study & Dealer Walk-In Study 13
14 What advertising drives dealer walk-in traffic? Of the 54% brought to the dealership by the Internet, 61% do not contact the dealership first. Internet 54% Newspapers 13% Classified Magazines Radio 4% 15% Walk-In 61% Phone 25% Television Direct Mail Outdoor Advertising Phone Book 8% 3% 0% 3% 14% Source: 2008 Dealer Walk-In Study 14
15 It s important to invest in efficient and effective media. The Internet is the number one media source at driving walk-in traffic. However, dealers are still spending heavily on more traditional media such as Newspaper, Radio and TV. Internet 17% 54% Newspaper 13% 27% TV 8% 17% Primary Media Source Leading to Dealership Dealer Advertising Spend Radio 4% 17% Direct Marketing 3% 10% Source: 2008 Dealer Walk-In Study & NADA Data 2008 Report. 15
16 Objectives Thank You! 16
NORTHWOOD UNIVERSITY & AUTOTRADER.COM PRESENT: DEALER WALK-IN STUDY RESULTS
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