Internet Playing Bigger Role in Consumers' Vehicle Purchase Decisions

WESTLAKE VILLAGE, Calif. – As consumers become more familiar with using the Internet to purchase new vehicles, auto dealers are increasingly satisfied with the online buying services providing them sales leads, according to the J.D. Power and Associates’ 2005 Dealer Satisfaction with Online Buying Services StudyT released Sept. 13. Although only 10 years old, the concept of online buying services has made a dramatic impact on how consumers shop for vehicles, said J.D. Power’s Dennis Galbraith, senior director of online marketing solutions. The Internet, he added, provides matchmaking capabilities that were never available to this industry before, and more improvement is inevitable over the remainder of this decade. Galbraith forecasts that “the future will bring even greater emphasis on matching shoppers with the right vehicle, the right dealership and the right salesperson.” Not only are consumers more comfortable with using the Internet in researching and buying their vehicle, the study also finds that dealers are most satisfied with online buying services sponsored by auto manufacturers. Dealer satisfaction, however, is improving particularly with “hybrid online buying services” – non-manufacturered affiliated services that deliver both online and offline leads to dealers, such as CostcoAuto.com. Satisfaction among dealers is also increasing for independent services that primarily focus on the sale of new vehicles, such as Dealix and Autobytel. The J.D. Power study also found that online lead generation for new vehicles continues to increase. However, online buying services that focus on the sale of used vehicles such as AutoTrader.com, cars.com, and eBay Motors, are providing fewer leads per dealer per month than in 2004, but the close ratio has increased to 18%.