How much are car buyers willing to spend on a car online?
Websites are a vitally important part of the buying process for motorists in the market for a new vehicle, as we discussed in our eBook, Digital Technology for Dealerships. They are used for research, comparing deals, looking for reviews, as well as finding the location and opening times for nearby retailers, and more.
The next logical step is a complete online buying journey – from research through to payment. Many manufacturers have launched click and buy websites, where customers can customise their vehicles to their individual tastes and requirements and go through to ordering without ever stepping foot on a forecourt. Does this spell the beginning of the end for retailers? Not according to new research from Dealerweb.
Are motorists willing to buy cars online?
Dealerweb has discovered a limit to what the majority of car buyers would spend when shopping for a vehicle online. They polled 1,200 UK motorists on the price range in which they would consider buying a new car entirely online (i.e. without speaking to a dealer or visiting a showroom) and found:
- 93% said they would not purchase a car online worth more than £30,000 – below the £33,559 average value of a new car sold in the UK, according to Cap HPI.
- 77% would never consider buying a new car online with a list price of more than £15,000.
- 52% said that they would never consider purchasing a new vehicle online under any circumstance.
What does the future hold for online car buying?
In a Card Expenditure Statistics report from UK Finance, it stated online card spending amounted to almost £187bn in the 12 months from November 2016 to October 2017. A month-on-month comparison between October 2016 and 2017 showed a 27% increase in the value of online card purchase transactions, clearly demonstrating a growing appetite for the convenience of internet shopping.
Will that translate to car sales? Retailers appear to be safe for the foreseeable future, as car buyers primarily use the internet to research their next car purchase, before visiting a dealership to inspect their chosen make and model, as we discovered in our Digital Technology eBook. However, retailers must ensure their online presence is as effective and efficient as their sales team, so they can continue funnelling online shoppers onto their forecourts.