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New-Vehicle Buyers Turn to the Web in Record Numbers

Changes in driving habits, high gas prices mean more research

October 17, 2008

• Auto Bailout Chief: GM's CEO Had To Go • Taxpayers Unlikely To Recover Full Auto Industry Investment • GMAC Changing Name to Ally Bank • New Car Sales Show Improvement From May • April Dismal For U.S. And Foreign Carmakers • Chrysler Files for Bankruptcy, GMAC Takes Over Financing • Auto Sales Stagnant, But Hope Appears • What Would a Chrysler Bankruptcy Mean For You? • U.S. Carmakers Getting More Federal Aid • GM Cuts More Jobs, Eyes China • New Car Sales Plunge in February • Car Buyers Seeking Higher Fuel Economy • Video: Do Women Really Hate Car Shopping? • GM Plans New Minicar, Electric Cadillac • GMAC Becomes a Bank • White House to Loan Carmakers $17.4 Billion • Chrysler Closing Car Plants for 30 Days • What Would a Washington-Designed Car Industry Look Like? • States Want Stronger Used Car Rule • Industry Troubles Cloud LA Car Show • Carmakers Get Neither Love Nor Money From Congress • Taxpayers Headed For Automotive Bailout • Time May Be Running Short for U.S. Carmakers • Feds Move Closer to Carmaker Bailout • New-Vehicle Buyers Turn to the Web in Record Numbers --- • More about Auto Sales ...

New-vehicle buyers are using the Internet more than ever when researching vehicle information, according to the J.D. Power and Associates 2008 New Autoshopper.com Study.

The study finds that 75 percent of new-vehicle buyers in 2008 are using the Internet during their shopping process, compared with 70 percent in 2007. It's the largest year-over-year increase in online shopping since 2001.

The total amount of time shoppers spend online researching automotive information also has increased since 2007 -- up 12 percent to more than six and a half hours. Meanwhile, the number of Web sites being visited by new-vehicle shoppers has remained relatively flat since 2007, which suggests that consumers have become more engaged with the sites they currently visit.

"The current economic environment, coupled with high fuel prices, has given rise to a shift in the vehicle buying habits of U.S. consumers," said Arianne Walker, director of marketing/media research at J.D. Power and Associates. "Shoppers who were once loyal to larger vehicle models are now finding themselves in the market for a compact or midsize car. For many, this is unknown territory, and these shoppers are turning to the Internet for information and education about the vehicles in their new consideration set. The resulting demand for information provides automotive marketers with valuable opportunities to reach out to shoppers via the Internet."

Automakers can further engage shoppers through consumer-generated content on the Web. According to the study, nearly 70 percent of automotive Internet users (AIUs) use consumer-generated content while shopping for a new vehicle. In particular, vehicle ratings and reviews are the most popular form of consumer-generated content, with 63 percent of AIUs utilizing this resource.

Additionally, 95 percent of AIUs who use consumer ratings and reviews say that the information is "helpful." Dealer ratings and reviews are also popular among new-vehicle shoppers, with 38 percent of AIUs utilizing the resource, and 87 percent of those find the information "helpful."

"The collaborative environment facilitated by Web 2.0 is changing the way shoppers research vehicles, driving many to seek the experiences and opinions of other shoppers and owners," said Walker. "The opinions of other consumers are so impactful that we are already seeing distinct purchasing patterns develop between those shoppers who use consumer ratings and reviews, and those who rely solely on expert ratings and reviews."

The study also finds that different types of automotive Web sites have specific benefits that satisfy the information and shopping needs of consumers. For example, shoppers view independent, third-party sites such as Edmunds.com and Kelley Blue Book (kbb.com) as being most useful for researching vehicle pricing and for providing ratings, reviews and forums.

Conversely, shoppers view manufacturer Web sites as most useful for their information on vehicle model options, features and specifications, while dealer sites are perceived as being most useful for inventory information.

"The challenge for automotive manufacturers and dealers alike is discovering how best to get involved in online conversations taking place among consumers in order to shift sales to their advantage," said Walker. "Knowing the strengths of various types of sites and where shoppers are going for their information can enable manufacturers and dealers to manage their site content more strategically and focus on efficiently targeting consumers at each stage of the shopping process."

The study also finds that Kelley Blue Book (kbb.com) is the most visited independent Web site, with 44 percent of automotive Internet users visiting the site. Additionally, Edmunds.com is the most useful independent Web site among automotive Internet users.

Edmunds.com shoppers are 42 percent more likely than consumers using other independent, third-party sites to say that the reviews, forums and ratings are the most useful information on the site.

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