Marketing Forecast from Ad-ology

As Americans emerge from the recession, they are buying much different vehicles than they did before the crash – smaller and more fuel-efficient – signifying a major shift. Compared with consumers in the first half of 2007, Americans now are buying more cars, fewer trucks and smaller vehicles in general; smaller and less expensive cars within segments; and ordinary rides that replace bigger or more luxurious vehicles. Still, as they go down in size, buyers aren’t necessarily sacrificing equipment.

Consumers who are venturing into the car buying market for the first time generally do not have enough cash to purchase a vehicle. This situation means they must research financing alternatives before signing a contract. These buyers also need to consider the total cost of ownership before they make a decision. But a recent survey from Capital One Auto Finance shows first-time car buyers lack the information they need to make a financially responsible decision.

Foresight Research recently introduced its proprietary “2010: Automotive Marketing Return On Investment” study. As part of that study, a detailed examination of the influence of the internet and social media on automotive purchase decisions was conducted and returned interesting results. In 2009, 86% of all new vehicle buyers used the internet in their new vehicle purchase process. Of this group, 90% used the internet to compare vehicles and pricing, while 83% checked it for incentives. For young buyers under the age of 35, nearly a quarter (24%) used social networking to share their decision.

New research on the automotive aftermarket from The NPD Group finds there is a direct relationship between the specific attributes of price, guarantees, and brand variety, and future purchase intention. According to NPD’s Car Care Trac, the percentage of consumers who reported they “definitely will” shop a retailer again in the future declined dramatically as satisfaction with the most recent purchase occasion declined. Seventy-one percent of those who rated the most recent purchase occasion as “excellent” said they definitely will shop the retailer again. “NPD’s analysis shows the importance of understanding what really drives satisfaction and future purchase intentions at the total market level,” says David Portalatin, industry analyst for NPD’s automotive aftermarket unit.

Sales in the pickup truck market are about to get more competitive. Mahindra & Mahindra, an Indian-based company, has been waiting for over a year to introduce its compact diesel pickup in the U.S. The firm had originally planned to launch the truck, to be named either the TR20 or TR40, last summer. But the entire auto industry slowdown forced Mahindra t change its plans. Now the company plans to begin actively selling its trucks in the U.S. by December.

Car selling season is upon us and U.S. manufacturers hope to increase their market share. In particular, Ford is determined to make a success of its new subcompact car. Part of the company’s strategy has been to train dealers on how to sell smaller vehicles. The other part of the strategy is all about marketing.