What Car? Insight weekly update – week four
What happens after the V-shaped bounce?
This is the fourth in a series of weekly updates for industry colleagues from Rachael Prasher, managing director of What Car? and Haymarket Automotive.
On face value, our weekly poll of consumer intentions data suggests a V-shaped bounce in the new car market post-lockdown.
If correct, that would mirror the Chinese market, which has seen a sharp improvement from a fall of 80% year-on-year in February to a decline of just over 40% in March. Preliminary figures for April look just as encouraging – with average daily sales doubling from around 20,000 cars in the first week of the month to 40,000 in the third – although a series of incentives have helped spur those numbers.
But what happens here in the UK later in the year? Can this recovery be sustained in the face of a certain economic downturn and dented consumer confidence? Could we see another dip?
Last week, the Government confirmed that dealers could “sell and deliver” cars during the lockdown. While some have successfully been doing the former since the beginning, some have missed the opportunity. We know from the leads we’re generating and comments from the likes of Peter Vardy, Robert Forrester and Daksh Gupta, people haven’t just been looking; they’ve been buying.
Now, I would argue, the need to respond has become urgent. No one should under-estimate the psychological impact the Government’s statement had on the car-buying public. The story was the third most-read news story of the week on What Car? and the most read – by a factor of three to one – on the always more news-led Autocar. Just days later, as you’ll read below, we recorded our best day of car-buying enquiries since lockdown began.
‘Sunday marked a turning point; new car leads were above our daily average for 2020’
We are still polling visitors to our site to ascertain the full impact of the statement on car-buying intentions, having closed our previous poll the day before it was made. However, up until that point, it continued to show that the number of people looking to buy “as soon as coronavirus is over” still stands at around one in five. Similarly, the much smaller yet important group of car buyers trying to complete on a deal in the next four weeks has consistently grown again – now up 50% since the start of April.
Those stats are great news for under-pressure car makers and buyers in the short term – but of potentially more concern is the declining number of people indicating they intend to buy in more than six months. That figure is down 21% since the start of April. Given that this group of car buyers is usually the largest proportion of people visiting What Car? – by virtue of our dual role in the purchase funnel of early research and point of purchase – we shouldn’t ignore the fall.
I have two theories. The first is that we’re simply seeing a higher concentration of in-market buyers who are looking to complete on a deal in the short term. If true, we might see a softening of this figure in the coming weeks as dealers start delivering and restrictions ease. The second, more worrying one is that long-term confidence is genuinely being eroded at the moment.
People buy cars because they need to and because they want to; it’s natural rational and emotional purchasing behaviour. Confidence is a key driver for those wanting to change. Either way, the message is clear: it has never been more important to respond to leads. Those dealers and OEMs on the front foot today, with virtual sales advisors managing enquiries and operational teams gearing up to deliver (stock) cars, will not only capitalise on the early stages of any V-shaped bounce but also be in a stronger position to fill up a pipeline of orders that will protect them over the longer term.
Enquiries to dealers rise again
Throughout lockdown, we have tested direct email consumer marketing of our New Car Buying platform off and on, trying to judge when the public mood is in the right place to respond to us highlighting our best deals.
This Sunday looks to have been a turning point. The number of leads generated were up – marginally – on our all-year average, including the boom first three months of this year in the run-up to March.
Couple that with our evidence of recent weeks that those who do make enquiries are more engaged than ever, but still expecting prompt replies from dealerships, and you will understand why I repeat again that there is business out there today for retailers who are open and nurturing leads.
Sell your cars online for free
‘Online selling’ is a buzz phrase in our industry right now, so please don’t miss the opportunity to take advantage of our free offer sell to What Car?’s audience through our New Car Buying platform during lockdown. There’s no charge and no lock-in period, either.
For more information:
Call 020 8267 4138 or email firstname.lastname@example.org