DETROIT –Used-car shoppers show dissimilar buying behavior compared with their new-car counterparts.
“The two groups are very different,” says Mitch Golub, CEO of Cars.com, an online automotive marketplace.
Used-car shoppers tend to focus more on which vehicle to buy, typically having three or four different models in mind as they click through online listings. They also do a lot of price comparing among cars on their shopping list.
In contrast, new-car consumers tend to come to quicker conclusions on which car to buy, and concentrate more on where to buy it.
“Used-car shoppers are looking for a car; new-car shoppers are looking for a car dealership,” Golub tells WardsAuto. “If you are looking at new cars, there is less of a price difference, so there is more focus on picking the dealer.”
Many consumers arrive at dealerships armed with information garnered online. Such preliminary research has exploded in recent years.
“People are looking at consumer reviews, as well as expert reviews,” Golub says. “And they are looking a lot at dealer reviews. They also are looking at vehicle specifications, mileage and costs.”
Last March, Cars.com began running consumers’ dealership reviews. Dealers are allowed to opt out of participating.
“I was expecting fallout on some level, but we only had two cancellations because of negative reviews,” Golub says. “One dealer came back two days later; the other, five days later. Basically, after they got over their anger, they realized they had problems that had warranted the bad reviews.”
Most dealers enjoy good reviews: The average rating is 4.4 out of 5.
“Dealers are finding the negative review feedback helps them fix problems,” Golub says. “And dealers use good reviews to their advantage. A Washington DC dealer said his good reviews are as important as $100,000 in advertising.
“He said, ‘Who better to tell you how you are doing than your customers?’”
Cars.com screens reviews for obscenities and inappropriate content, but 92% of submissions are posted. Nearly 20% of reviews spur posted dealer feedback, “so it is a forum for dealers to give their input,” Golub says.
Most consumers deciding where to buy a car put much emphasis on the quality of a dealership’s service department, he says. “Ninety-one percent of consumers want to see the service-department reviews before they buy a car.”
Checking out the back-end operation before purchasing a product from the front-end showroom may seem improbable. But Golub says many shoppers see the two as connected when it comes to whether they can deliver customer satisfaction.
