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Impact of Digital Media on Vehicle Buying Decision Making Process

Agenda

Statistics on cars

Indian Digital consumers

Research analysis and Implications

Question and Answer

Statistics of Cars Market

India became the fifth largest motor vehicle/car manufacturer in the world in 2011.

The Indian small and light commercial vehicle segment is expected to grow at 18.5 per cent compound annual growth rate for the next five years, according to a report by Frost & Sullivan.

In The LCV market - both passenger and goods carrier estimated to register a sales growth of around 20 per cent during FY 2012-FY 2015, as per a RNCOS report.

Name of report by Frost & Sullivan- 'Strategic Assessment of Small and Light Commercial Vehicles Market in India.

Name of report by RNCOS- India LCV Market Outlook

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Indian car market.

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BCG Perspective on Indian Digital Consumers

Research and Analysis

City SurveyedSampleSizeSampling Technique Number of QuestionsMumbai98Convenience Sampling25

Data Collection

QuestionnaireSegmentQuestion Type Number ofQuestions1Demography072Opinion and Preference Analysis103Impact of Media08

Data Analysis

Demographic Analysis

Opinion and Preference Analysis

Demography vs. Impact of Digital Media (ANOVA )

Demography vs. Switching Tendency (ANOVA)

Factor Analysis

Analysis was done by SPSS software

Demography

Age GroupNote: Data presented as percentage of total sample size (98).Majority of the respondents are in the age group of 26-35(46.7%) and 18-25 (25.6%).

Educational QualificationNote: Data presented as percentage of total sample size (98).Majority of the respondents are graduates (58.9%).

Price Range of the VehicleNote: Data presented as percentage of total sample size (98).Unit in lacs.Vehicles pertaining to the respondents are primarily in the price Range of 3 6 lacs (44.4%) and 7 10 lacs (41.1) category.

Internet Usage Per DayNote: Data presented as percentage of total sample size (98).Unit in hours.Majority of the respondents use internet for 3- 4 hours (37.8) and 1 2 hours (24.4).

OccupationNote: Data presented as percentage of total sample size (98)Majority of the respondents are working professionals (64.4%).

GenderNote: Data presented as percentage of total sample size (98)Majority of the respondents are men (75.4%).Women are 24.4%.

Household SizeNote: Data presented as percentage of total sample size (98)Majority of the respondents have household size 3 4 (41.1%) and 5 6 (31.1%).

Annual IncomeNote: Data presented as percentage of total sample size (98).Unit in lacs.Majority of the respondents have annual income of 8 10 lacs (52.2%) and 5 7 lacs(31.1%).

Target Group ProfilingNot so adventurous when it comes to trying new vehiclesIs Brand ConsciousNot ExperiencersAre Innovators Has a green thumb

Importance of Features in a vehicle

InferenceImportant Features From Highest to Lowest Preference

Those features with mean rating greater than 4.21

Important Features of Brand WebsiteVehicle Feature section is of most importance to the consumers. Dealer locator, price related information have second Preference and third preference respectively.

Tendency to change choice with respect to attractive offerMajority of the respondents do not have tendency to changechoice even if they encounter offer in terms of price discount.

Importance during Information Gathering Phase Top three most important channelsSearchBrand WebsiteAuto Portal and Review

1Search2Brand Website3Auto Portals3Reviews4Comparison Content5Schemes + Offers6Experiential Content7Testimonials8Display Media9Social Media

Rank of each channel in Information Gathering phase

Importance during Comparing and Refining Phase Top three most important channelsComparison contentReviews and SearchAuto Portals

1Comparison Content2Reviews2Search3Auto Portals4Schemes + Offers5Brand Website6Testimonials7Experiential Content8Social Media9Display Media

Rank of each channel in Comparing & Refining phase

Importance during Deciding Make & Model Phase Top three most important channelsSearchReviewsAuto Portals

1 Search2 Reviews3 Auto Portals4 Testimonials5 Brand Website6 Schemes + Offers7 Comparison Content8 Experiential Content9 Social Media10 Display Media

Rank of each channel in Deciding Make and Model phase

The major digital channels used for the Selecting & Locating dealers are SearchSchemes & OffersBrand WebsiteImportance in selecting and locating dealer phase

1Search2Schemes + Offers3Brand Website4Auto Portals5Reviews6Experiential Content7Testimonials8Comparison Content9Social Media10Display Media

Rank of each channel in Selecting and Locating dealer phase

The major digital channels used for the Post Purchase Experience are Brand WebsiteAuto PortalsReviewsImportance in post purchase phase

1Brand Website2Auto Portals3Reviews4Search5Testimonials6Experiential Content7Social Media8Comparison Content9Display Media10Schemes + Offers

Rank of each channel in Post Purchase Phase

Gather InfoCompare and RefineDecide Make and ModelSelect and locate dealerVehicle Experience (Post purchase)SearchSocial MediaDisplay MediaBrand websiteAuto PortalsReviewsTestimonialsExperiential contentComparison contentSchemes + Offers

Importance of platforms across stages in Vehicle Buying Process

Digital ExposureTop three vehicle brands according to digital exposure on the consumer:Maruti Suzuki ALTO 800Mahindra VeritoTata Indica Vista

Rank of the Vehicle Brands according to Digital ExposureMaruti Suzuki ALTO 8004.2Mahindra Verito3.97Hyundai EON3.63Tata India Vista3.76Maruti Suzuki Swift3.53Hyundai i203.45Honda Jazz3.2Volkswagen Polo3.12Ford Figo2.85

Reasons for buying a HatchbackMajority of the consumers buy hatchback, as it is economically Feasible and easier to park to smaller space.

Analysis of Variance (ANOVA)In ANOVA we looked at the significance difference between the variables. ANOVA provides a statistical test of whether or not the means of several groups are all equal.

Here we have taken Significance level of 95%.

Impact of Digital Media

AgeGenderInternet UsageEducational QualificationsOccupationAnnual Income

edia

Digital MediaHousehold size

Age Vs Digital Media

Inferences A significant difference in mean was observed for age groups with impact of digital media on vehicle buying decision making process.

26 35, 18 25, 36 45 age groups are highly influence by digital media.

In the age group of 26-35, the impact of digital media is highest.

Gender Vs Digital Media

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Inferences Significant difference in mean was not observed for gender with impact of digital media on vehicle buying decision making process.

Occupation Vs Digital Media

Inferences Significant difference in mean was observed for occupation with impact of digital media on vehicle buying decision making process.

Working Professionals, students, public sector service professionals are highly impacted by digital media.

It is observed that impact of digital media is highest for professionals in the public sector service.

Internet Usage Vs Digital Media

Inferences Significant difference in mean was not observed for usage of internet with impact of digital media on vehicle buying decision making process.

Educational Qualification Vs Digital Media

Inferences Significant difference in mean was not observed for educational qualification with impact of digital media on vehicle buying decision making process.

Household size vs Digital Media

Inferences Significant difference in mean was observed for household size with impact of digital media on vehicle buying decision making process.

Impact of digital media is highest for household size of 1 2.

Annual Income vs Digital Media

Inferences Significant difference in mean was observed for income level with impact of digital media on vehicle buying decision making process.

It is observed that impact of digital media is highest for the annual income level of 5-7 lacs.

Tendency to Switch to Sedan

AgeGenderEducational QualificationsOccupationAnnual Income

edia

Switching TendencyHousehold size

Age Vs Tendency to Switch

Inferences A significant difference in mean was not observed for age groups with switching tendency to sedan.

Gender Vs Tendency to Switch

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Inferences Significant difference in mean was observed for gender with switching tendency to sedan.

Females have higher tendency to switch to sedan.

Occupation Vs Tendency to Switch

Inferences Significant difference in mean was not observed for occupation with switching tendency to sedan.

Educational Qualification Vs Tendency to Switch

Inferences Significant difference in mean was not observed for educational qualification with switching tendency to sedan.

Household size vs Tendency to Switch

Inferences Significant difference in mean was observed for household size with switching tendency to sedan.

Tendency to switch to sedan is highest for household size of 5 6.

Annual Income vs Tendency to Change

Inferences Significant difference in mean was not observed for income level with switching tendency to sedan.

More than one third of our sample size prefers to book test drives via dealerships over digital platforms such as cell phones or brand website.From the above graph we can infer that brand websites and cell phones have certainly not taken over the traditional ways of booking test drives. However, collectively they do have a good enough opportunity to attract a sizeable chunk of potential car buyers.Medium for Test Drive Booking

From the above charts it can be concluded that Digital Media does impact 62 respondents out of a sample size of 98 in our study and the Mean score of these 62 respondents is significantly high.

Mobile Platform is mainly used for selecting & locating dealer as well as finding out maintenance tips. Usage of Mobile Platform

Time Taken for each stage1-4 days5-9 days10-14 days15-19 days 20 days & moreNeed Recognition 33 respondentsGather Info 25 respondents 25 respondentsCompare and Refine 31 respondentsDecide Brand and Model 21 respondents 24 respondentsSelect and locate dealer 22respondentsTrial/Test drive28respondentsFinal Purchase 36 respondents

The maximum amount of days required for a potential car buyer is for the Need Recognition & the Final Purchase phases.Conversely, the minimum amount of days are required for Deciding Brand & Model phase and Selecting & Locating dealers.

Factors to be considered in the Vehicle Buying ProcessFeaturesRatingsVery LowLowNeutralHighVery HighExterior looksSafetyPriceMileageMaintenanceAfter Sales ServiceSpace & ComfortColourFuel EfficiencyProduct ReviewsTestimonials from ownersProduct TestsResale ValueEngineFuel Type(Petrol/Diesel/CNG)

Factor AnalysisWe conducted a factor analysis in order to reduce the data into a smaller set of summary variablesFollowing are the 5 components within which we can club the individual factors:

Guess the Celebrity

Guess the Celebrity

Guess the Celebrity

Whats the word Online?

Buzz Mentions : Brand wiseTata leads the vehicle brand category with highest online mentions(12239). Maruti and Hyundai are following Tata with 8084 and 7524 mentions respectively

Brands taken into consideration:Chevrolet Beat Chevrolet Spark Fiat LineaFord Fiesta Ford Figo Honda Brio Honda City Hyundai Elantra Hyundai EON Hyundai i10 Hyundai i20 Hyundai Verna Mahindra Verito Maruti Alto Maruti Swift Maruti Swift Dzire Maruti SX4 Nissan Micra Nissan Sunny Renault Scala Maruti Ritz Skoda Rapid Tata Indica Vista Tata Indigo eCS Tata Indigo Manza Tata Nano Toyota Etios Volkswagen Polo Volkswagen Vento Wagon R Chevrolet Beat Chevrolet Spark Fiat Linea Ford Fiesta Ford Figo Honda Brio Honda City Hyundai Elantra Hyundai EON Hyundai i10 Hyundai i20 Hyundai Verna Mahindra Verito Maruti Alto Maruti Swift Maruti Swift Dzire Maruti SX4 Nissan Micra Nissan Sunny Renault Scala Maruti Ritz Skoda Rapid Tata Indica Vista Tata Indigo eCS Tata Indigo Manza Tata Nano Toyota Etios Volkswagen Polo Volkswagen Vento Wagon R 79

Brand Personality

Brand Personality

Website VisitsSource: comScore Type: 3 month Average April, 2013

Chevrolet.co.in

Chevrolet.co.in website has most number of visitors from the age group 25-34. Other Car Brand websites such as Hyundai, Ford & Maruti Suzuki as well as some auto portals have the highest percentage of visitors that also viewed Chevrolet.co.in Source: comScore

MarutiSuzuki.comMarutiSuzuki.com website has most number of visitors from the age group 25-34. Other Car Brand websites such as Hyundai, Ford & Volkswagen as well as some auto portals have the highest percentage of visitors that also viewed MarutiSuzuki.comSource: comScore

Ford.comFord.com website has most number of visitors from the age group 25-34. Other Car Brand websites such as Hyundai, MarutiSuzuki & Volkswagen as well as some auto portals have the highest percentage of visitors that also viewed Ford.comSource: comScore

TataMotors.comTataMotors.com website has most number of visitors from the age group 25-34. Other Car Brand websites such as MarutiSuzuki, Hyundai & Ford as well as some auto portals have the highest percentage of visitors that also viewed TataMotors.comSource: comScore

Mahindra.comMahindra.com website has most number of visitors from the age group 25-34. Other Car Brand websites such as MarutiSuzuki, Hyundai & Ford as well as some auto portals have the highest percentage of visitors that also viewed Mahindra.comSource: comScore

ToyotaBharat.comToyotaBharat.com website has most number of visitors from the age group 25-34. Other Car Brand websites such as Ford, Hyundai & MarutiSuzuki as well as some auto portals have the highest percentage of visitors that also viewed ToyotaBharat.comSource: comScore

Volkswagen.co.inVolkswagen.co.in website has most number of visitors from the age group 25-34. Other Car Brand websites such as Hyundai, Ford & Maruti Suzuki as well as some auto portals have the highest percentage of visitors that also viewed Volkswagen.co.in Source: comScore

Hyundai.comHyundai.com website has most number of visitors from the age group 25-34. closely contested with the age group 15-24.Other Car Brand websites such as MarutiSuzuki, Ford & Volkswagen as well as some auto portals have the highest percentage of visitors that also viewed Hyundai.comSource: comScore

Honda.comHonda.com website has most number of visitors from the age group 15-24. closely contested with the age group 25-34.Websites such as Honda2WheelersIndia, HondaCarIndia & the Brand Website of Hyundai as well as some auto portals have the highest percentage of visitors that also viewed Honda.comSource: comScore

Insights from Brand WebsitesTatamotors.com and Toyotabharat.com have highest number of male visitors.Volkswagen.co.in has highest number of female visitors.Honda.com has highest number of visitors from the age group of 15-24.Mahindra.com has cross visitors from RoyalEnfield.com. Source: ComScore

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KeywordCompetitionLocal Monthly Searches (India)car price0.59450000car prices0.61301000car dealerships0.75201000car price in india0.56135000cars online0.4174000car comparison0.4249500car price list0.6633100new car prices0.7712100car price comparison0.62900

Top Generic KeywordsSource: Google Adwords Keyword Tool

KeywordCompetitionLocal Monthly Searches (India)hyundai india0.29201000car maruti0.64135000ford india0.32135000toyota india0.29110000honda cars0.5290500honda dealers0.3190500honda showroom0.2590500maruti india0.3374000cars of tata0.5974000tata cars0.5974000tata india0.3374000mahindra cars0.5660500hyundai cars0.6560500

Top Brand KeywordsSource: Google Adwords Keyword Tool

ConclusionAfter sales service, Safety, Space & Comfort are the most critical features that prospective buyers look for while buying a vehicleFeatures of the vehicle is the most important section for the consumers on a brand websiteTop three vehicle brands according to digital exposure on the consumer:Maruti Suzuki ALTO 800Mahindra VeritoTata Indica VistaTendency to switch to sedan is highest for female and same applies to respondents with house hold size of 5-6.

In the age group of 26-35, the impact of digital media is highestThe impact of Digital Media on the Vehicle buying decision making process is indifferent of Gender & Educational QualificationBrand websites and mobile phones collectively have a good enough opportunity to attract a sizeable chunk of potential car buyersDigital Media highly impacts more than 2/3rd of our respondentsMobile Platform is mainly used for Maintenance Tips as well as Selecting and Locating car dealers

Conclusion

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