OVERCOMING THE DISCONNECT BETWEEN CONSUMERS AND DEALERS WHEN IT COMES TO SOCIAL MEDIA TOOLS
As my regular column followers will attest, I often refer to the disconnect between consumers and auto retailers. In the fall of 2011, I was fortunate to meet Diane Mackie, President of Idea Space, an independent research firm located in Barrie, Ont. We got to talking about the industry and its issues and quickly arrived at social media.
Diane also teaches research techniques and data interpretation to final year students at the Automotive Business School of Canada (ABSC) and to post-graduate students in the research analysts program. Diane was intrigued with the whole social media interaction with automobile dealers.
To make a long story short, Diane and I met with Rick Gauthier, President and CEO of the Canadian Automobile Dealers Association to discuss whether CADA would support the idea of both her classes conducting research on the issue of Canadian auto dealerships and their use of social media. Rick jumped at the opportunity and an independent, Canadian focused research study on social media was born.
Patrice Maltais and I had the opportunity to kick-off the research at the ABSC last January, to an enthusiastic group of students, all social media power users.
IN-DEPTH RESEARCH
Over the January to April 2012 winter term, her students conducted a significant number of dealer and consumer face-to-face interviews and focus groups with both consumers and dealers alike. To gain firsthand data from automotive consumers, some 32 students, equipped with handheld technology roamed the halls at the 2012 Canadian International Auto Show in Toronto. Back at the ABSC, other students conducted face-to-face and telephone interviews with dealers right across Canada. Yet another group of students conducted in-depth focus groups each lasting for more than two hours with consumers. It was a very extensive and energetic exercise.
Diane then made a competition out of this program. I recently had the pleasure of participating, at CADA’s offices, in a Dragon’s Den type presentation by the winning team consisting of four post-graduate students; Virginia Connell, Robert Jamison, Barb Paszyn, and Dorothy Soltys. For almost two hours these students presented their findings and interpreted the results. We were all blown away by their professional approach and presentation quality and also the relevance of their findings to auto dealers today.
With their permission, this article will summarize some of the teams’ key findings. Although a short article does not do their report justice, the golden nuggets contained in the report are worthy of repeating here as many of us struggle with getting our heads around the social media phenomenon.
The objective of the study was to gain insight into the social media desires of consumers and identify the current capabilities of auto retailers to meet or exceed those desires. From this exercise, the “gap” or disconnects might be identified to aid auto dealers in focusing their individual approach for their stores.
KEY CONSUMER FINDINGS
Platforms, demographics and reach
- Facebook is by far the number one social media platform, followed closely by YouTube. Twitter is a distant 3rd.
- Most of those interviewed in the 16 to 30 age range are daily users.
- The over 40 age group access Facebook and YouTube on average twice per week.
- 33 per cent of respondents had over 400 friends/followers. Only 15 per cent had fewer than 100 friends/followers. To put this into perspective, for the auto show interviewees only, the total number of friends for the 400+ interviewees added up to over 92,000 individuals. This is obviously a powerful communications forum for those dealers that expose themselves via this medium.
Positive vs. negative posts
- Social media users consume more than they post with reading someone else’s post occurring approximately 64 per cent of the time.
- Favourable content outweighs negative content. Isolated negative posts or rants are for the most part ignored. Users are looking for balance and normally form their own impressions after reading a number of posts.
Brand vs. Dealership
- There is less focus on dealerships than brands. At this point in the evolution of social media, information about the brand is sought after 33 per cent more often than dealership information.
- Brand post frequency is double those to dealerships.
- 21 per cent of respondents have made a positive post about a dealership with 15 per cent having made a negative post.
- Promotions/contests are strong draws.
Click “like” or “follow” currently
- 49% like or follow at least one brand.
- 43% like or follow a promotion or contest, either brand or dealership.
- 39% like or follow events.
- 33% like or follow a dealership.
- 30% like or follow enthusiast groups.
- 26% like or follow industry experts or independent 3rd parties.
Motivators to click “like” or “follow” – Dealership Specific
- Relevant content is key!
- 62% sales related promotions.
- 40% service related promotions.
- 31% owner reviews and testimonials.
- 31% info about specific models at the dealership.
- 10% do not like or follow anything.
Motivators to click “like” or “follow” – Brand Specific
- 58% promotions and rebates.
- 41% future products and designs.
- 41% videos.
- 20% question or discussion forum.
- 26% model comparison data.
- 11% do not like or follow anything.
Top Influencers impacting the vehicle buying decision
- 61% word of mouth.
- 54% positive posts from a “friend” on Facebook/Twitter.
- 54% a review by industry experts of a particular make/model.
- 48% previous purchasers’ comments.
- 47% negative posts from a “friend” on Facebook/Twitter.
- 43% manufacturer website.
- 31% auto dealer’s website.
- 25% manufacturer’s Facebook page.
- 21% dealer’s Facebook page.
- OEM and Dealer’s Facebook page are not yet a major influence of the purchase decision but focus groups reveal that they are often the beginning of a conversation with prospects.
Traditional vs. New Media
- Traditional forms of informing/connecting with consumers remain the most important influence to consumers opinions at 42 per cent of respondents.
- Social media is clearly gaining momentum with 38 per cent of respondents. A full 20 per cent indicate they rate them equally.
- New media cannot be ignored by dealers and their brands.
Pre-Purchase Tool
- Social Media is an integral pre-purchase tool.
- Consumers gain awareness of current offers or upcoming events.
- Arms the consumer with rich information prior to visiting a dealership.
- Public forums provide knowledge that actually causes change in the ultimate purchase.
Credibility
- Consumers are aware of credibility issues.
- In forming their opinion, consumers consider many rather than few online comments.
- Traditional word-of-mouth still prevalent in the purchasing decision.
- Consumers still trust the opinions of those they know personally first and foremost.
- Consumer Expectations of their Dealership
- In response to the abundant and instantaneous information available online, consumers expect the dealer to have more knowledge of the product than is available online.
KEY DEALERSHIP FINDINGS
Website review
- 13 per cent of dealers do not have a website!
- Of the 87 per cent of dealerships that do have a website, 61 per cent of dealership websites do not show the Facebook symbol. This does not necessarily mean that these dealerships do not have a social media presence.
- 54 per cent have fewer than 200 Facebook followers.
- 10 per cent have more than 1,500 followers.
- Weighted average number of followers is 425.
- 77 per cent of dealership websites do not show the twitter symbol on their website.
Training
- Most dealers rely on their own initiative to learn about social media.
- Social media presence is new for most dealerships.
- Most dealers have not received formal training in social media usage.
The Messenger
- The gateway to social media seems to be Facebook.
- YouTube is becoming popular to advertise cars and dealerships.
- Social media is assisting dealers to develop word-of-mouth advertising.
- Ability to achieve fast responses to positive and negative feedback.
- It is viewed by dealers as an inexpensive and effective marketing tool.
Dealer perceptions
- Dealers that are unfamiliar with social media tend to be skeptical of its benefits.
- Negative experiences expressed by consumers on social media are perceived to have more of an impact.
- Some dealers believe it is too time consuming and an unproven method to sell cars.
- Others believe it enhances customer relations and is effective for advertising.
- Others again believe they do not want to be left behind and to remain competitive they must adopt the medium.
KEY CONCLUSIONS
- YouTube videos are viewed as effective in engaging customers through emotion.
- Small incentives used to encourage customers to “like” or “follow” are an effective way to build your base of social media friends.
- Close alignment with the dealership website (in some ways social media could act like a portal), creates consistency and credibility.
- Allows dealers to quickly measure the effectiveness of campaigns.
- Allows dealers to communicate with their friends in a warm, word-of-mouth type of environment.
- Allows the dealership to show its personality through responses to both positive and negative comments, again building credibility.
- Allows the dealership to be exposed to a large circle of warm leads by befriending friends of friends.
The challenge: defining the gap
Consumers expect dealerships to add to their information base when visiting stores; they certainly do not expect to know more than the dealership staff.
A disconnect currently exists in many cases, where dealerships assume this is a medium only for youth. In fact, social media users vary in age, geography, social status and ethnicity.
This is another disconnect: Consumers like to read a variety of reviews, good and bad where dealers on the other hand are fearful that bad reviews will cause consumers to shy away.
This leads to yet another disconnect: Dealers are posting business and sales related content while social media users are looking for relationships, sign of a dealership’s personality and emotion. The lack of cohesion is a big disconnect.
This article is filled with a host of useful facts that we can quickly absorb and put into play. Social media is a powerful tool if you understand the wants and preferences of your target audience. It enables your current customers to be your advocates, except their “word-of-mouth” concept has evolved to include “words-from-their-fingertips.”
