Franchised dealers still seen as most trustworthy by used buyers despite growth of online-only retail
This is the latest report in a series of weekly updates for industry colleagues from Rachael Prasher, managing director of What Car? and Haymarket Automotive. Quoted poll data is from more than 1500 whatcar.com users.
Online-only retailers have significantly increased their presence in the used car market over the past 12 months. Operating without physical sites, buyers view and purchase their car entirely online, with the sector representing a new, and potentially a very profitable, direction for the industry.
To find out how receptive used buyers are to buying their next vehicle entirely online, we polled 1571 used in-market buyers as part of our latest industry study. In our research, 94% of respondents stated that they are either very or fairly confident in buying their next used car from a franchised dealer, compared with 63% from a car supermarket, 55% from an independent dealer and 20% from an online-only provider.
The relative lack of confidence in buying online came despite reasonable awareness of the ‘big three’ retailers in the sector; Cazoo, Cinch and Carzam.
More than half of respondents had heard of at least one of the trio, with confidence growing to 56% with awareness of the brand. Age was not a significant factor in determining this level of trust, with buyers in the 17 to 34-year old and 55 and over age groups expressing similar levels of confidence
The survey also revealed that cash remains the favoured way to buy a used car for 72% of buyers, while 13% expect to take out a personal bank loan, and 11% are looking to either lease or finance their next used purchase.
With used car sales currently booming, the research found that 24% of used buyers expect to purchase in the next four weeks, while 33% are set to buy within 1-3 months.
The study shows that brand awareness is critical for online-only retailers because it’s correlated to an improved perception of trust. It also shows that even the biggest players in the industry have their work cut out for them.
For now, and potentially the foreseeable future, the majority of used car buyers are telling us that they would still prefer to purchase their next car from a dealer with a physical presence, rather than purely online.
For further insight from whatcar.com’s unique website data, please contact firstname.lastname@example.org