Newspapers Take Issue with J.D. Power Used Car Buyer Study

Newspapers Take Issue with J.D. Power Used Car Buyer Study

The Newspaper Association of America (NAA) was quick to take issue with the findings of the latest J.D. Power and Associates 2004 Used Autoshopper.com Study, which suggested that the internet is relied upon more in used car purchase decisions than newspaper advertising.

According to the Power study on which the WANADA Bulletin reported July 28, 2004, 54% of used vehicle buyers used the Internet during their shopping process, up from 47% in 2003. The study said 36% of used vehicle buyers were impacted by information found online, up from 29% in 2003. Around 22% say they were impacted in their selection of sellers, which is up from 16%. And among Internet users, 85% say the Internet impacted the price they paid for their vehicle, while 66% of this group say it impacted which model to purchase The study also found that, for the first time, online sources have outpaced traditional newspaper advertising as the method that led buyers to the vehicles they actually purchased. Only 9% of buyers say they found their used vehicle through a newspaper advertisement, while 11 percent attributed their purchase to the Internet.

–The Power study flies in the face of logic,” says Jake Kelderman, NAAês director of marketing for Auto Industry Relations. –As of June 2004, only 21.5% of the total used vehicle inventory is being offered online and the sales rate is 27.3%.

–Most troubling is that the Power study does not define what •impactedê means, he adds. –Used vehicle shoppers use a multitude of media to help them decide. The key for dealers is understanding which of these theactual buyer relied upon most. That way they are properly allocating their advertising dollars.”

From a dealer perspective, Kelderman says, –I sure would like to know what Internet sites the consumers are talking about the dealerês or what third party vendor? And if, as Power says, 11% of used car buyers found their car online and only 9% found it in the newspaper, then where are the other 80% found?”

Kelderman points to recently released findings from CNW Marketing Research, Inc.,which are part of the firm’s ongoing studies of how consumers use the media to help them decide on vehicle purchases. The study shows that, on average, approximately 91% of all used vehicle buyers use the newspaper to help them find the vehicle they are looking for and that nearly 60% rely on the paper as their “primary” source of information.

–No other media, including the Internet, approaches anywhere near these usage percentages,” says Kelderman.

CNW Marketing Research, Inc., also reports that as a primary source of information, newspapers outdistance the Internet by a full 26 percentage points for used car consumers shopping at franchised auto dealers, 60 percentage points for those shopping independent auto dealers and 67 percentage points for those shopping private party sales.

–The point is, you have to be very careful when determining how the Internet works,” says Kelderman. –One big issue the sites donêt talk about is the matter of multiple listing of vehicles on multiple sites. Itês just one car but when it sells, all the sites on which it was listed report it as sold by them. CNW looks at this very carefully and eliminates these double counts.

–You also need to look carefully at •time spent at a siteê because that is defined by both the nature of the site and the type of shopper doing the looking,” he added. –In the end, dealers are right to be interested only in the •qualifiedê shopper/buyer and newspapers still deliver those better than any other media.

–Of course dealers should have an online presence, but the newspaper automotive section is still the •touchstoneê of the local auto market for new and used vehicle buyers,” says Kelderman.