Detroit, MI - Detroit Trading Automotive Research & Insights
Since our original publication our team of data scientists have continued to monitor the trends. Through the Detroit Trading ClearPath™ Enterprise Platform, we’ve analyzed hundreds of millions of data points nationwide to produce this analysis. This article will show you how the following 3 key metrics we reported two weeks ago have progressed:
As in our original article, we’ve graphed daily activity of these three metrics against seasonally adjusted, historic activity - shown as the “expected” baseline in the charts below.
At last publication we saw a slight downturn in consumer interest. That continues to be the case when we add in the last 2 weeks worth of data. While there are some spikes above expected interest, a low start to April has affected the overall trend, which is slightly down. However, since then we’ve seen April bounce back in-line with expectations.
Below is a look at consumer interest based on body style and applied geographically to shed light on how regions’ Covid-19 cases affect the marketplace.
Consumer online shopping activity hasn’t decreased as much as one would expect during a pandemic of this magnitude. One highlight we’ve noticed is that there is a sizable increase in consumer interest, in some cases up 40%, in trucks as the crisis continues.
Overall data shows a downward trend in dealer activity over the past couple of weeks. As of publication, overall dealer’s participation in lead marketing is down approximately 10% from expected. With that said we see a dramatic difference by OEM, with some of the largest showing an increase in the number of dealers buying leads. Through our internal discussions with dealers and OEMs, we’re hearing that leads are the most valuable marketing lifeline during this crisis.
US Automotive Dealers continue to leverage leads to connect with interested consumers. Additionally, OEMs with the lowest declines in Q1 2020 sales either increased or had the smallest decreases in dealers utilizing leads.
The trend line represents expected close rate by day versus actual close rate by day. The trend line we illustrated in late March has turned downwards quite a bit. We are currently seeing 7 day close rates perform 25% - 75% lower than normal. Low close rates confirm that Covid-19 is indeed delaying sales.
Although purchases are being delayed, consumer interest remains strong and people want, and need, to buy cars. Following up with shoppers in preparation for when they are ready and able to act will be a key rebound strategy for dealers.
We’re seeing people shopping for cars online at near-normal levels. We’re also seeing dealer’s continue to utilize leads as an important part of their marketing strategy to connect with interested consumers. The clear news that buying decisions have been delayed makes sense in this climate. What we take to heart is that, historically, interest indicates intent to purchase. Dealers are the best entrepreneurs on the planet. If they can sell a car now they will, however in this environment it is critical to build a book of business and prepare for delivery when the consumer is ready. In doing that they’ll see sales increase and their business revived when restrictions loosen and the pandemic is under control
About the Author - Jack Lintol is the President of Detroit Trading, a Detroit-based firm that is amongst the world’s foremost data and technology providers of “in-market” automotive shoppers and shopper intelligence. The firm provides data and leverages data science for original equipment manufacturers and dealers that is responsible for more than 30,000 and $1 billion in monthly car sales. Contact Jack at email@example.com.
Detroit Trading – 248.352.1313
Learn more about these tips and more directly from the source!
Can't wait? Call (248) 965-4875 to learn more about our BDC Services.