The three key findings from a detailed research project on the cost-of-living crisis undertaken for MotoNovo Finance involving dealers and consumers are:
- Consumers are undertaking greater pre-purchase analysis of running and reliability costs.
- Buyers are seeking longer finance repayment periods.
- Overall, there is greater buyer hesitancy in making a purchase decision.
The report indicates evident changes in buyer behaviour driven by the economic changes of the last year, identifying some of the critical challenges facing dealers in sourcing stock and accommodating customers’ financing wishes.
That buyers undertake research online before contacting a dealer is well established. However, the research level has increased significantly to an almost forensic level as buyers seek to drill down to instill cost certainty.
When they arrive in showrooms, customers have assessed a broad range of cost-related attributes, often from a wide range of media. Information sought by buyers included fuel efficiency, clear air zone status, insurance, road fund licence, tyre and servicing costs. Some also seek insights on reliability and repair costs, and then there are finance costs.
Research over many years indicates that customers car buying journeys often start with an idea of what they can afford per month. However, this can be a challenge in the current environment. Lenders of all types have adjusted their lending criteria in light of the prevailing economic landscape, interest rates have increased, and people’s capacity to access headline rates often depends on their credit status.
Commenting on the position MotoNovo’s Commercial Director Debbie McKay (pictured) reflects, “The challenge and opportunity for dealers is ensuring detailed information is easily accessible across their promotional material, not just in tables but in descriptive commentary, which is often a customer’s first port of call. It is also important to be open and compliant about finance. An increased focus on creating informed buyers delighted to make positive buying decisions has never been more important.”