The ‘Auto Gear Shift India 2020 Report’ by Google India says that while the Tier-1 city consumers showed varied research behaviour, 86% of the Tier-2 car buyers were solely influenced by YouTube and the digital platform has bagged the second spot on the search engine for buying new cars.
The report also noted that nine out of the ten people being influenced did at least one follow-up action triggered by what was shown in the video for buying a new car. There is a 35% more increase in YouTube searches than in 2018.
Car buyers watch online videos for diverse, local and relevant content. They mainly focus on design (walk-around interior, 360º video, vehicle features and technology), in-action (vehicle safety tests, VR content, performance videos), reviews and ads (testimonials, third party reviews or comparison tests).
These trends arise as today the four-wheeler buyers are digitally connected more than ever before.
“With more than 500 million Internet users today, India is the second-highest connected country in the world. India has also added more than 100 million smartphone users in the past two years itself and with COVID-19, the average time spent has also increased in the last three months,” the report said.
There has also been a 33% increase in data consumption along with the drop in data prices. Over 500 million Indians are expected to view internet videos by the end of 2020.
Alongside, there had been an increase in searches for ‘Buy Car Online’ during the COVID-19 times along with a 3x growth in searches for EVs over the past years.
For the Auto Gear Shift India 2020 Report launched on Monday, with Kantar as its onground Research Partner, Google claims to have done an extensive survey of 2,000 respondents covering 17 cities from Tier-1, 2, 3 areas. While the respondent base was across male and female, the age groups relied upon were between 18 to 40 years. The respondents were chosen based on their access to the internet.
The report covered three segments – hatchback, sedans and SUVs – for studying the purchase journey of a four-wheeler buyer in India. It covered the organised and unorganised players for used car buyers and sellers.
Moving towards digital India
As per the Google report, 52% of respondents cited ‘improvement in the financial situation’ as the biggest common trigger for buying new cars.
While online resources occupied a major portion of the car-buying decision, offline resources like family, friends, dealer visits, test drives, TV ads and service advisors also contributed to that.
About 72% of respondents researched online to find their dealer through websites or search engines. One in every four new car buyers took action on the company website to reach the dealer, with 15% going through the online lead forms and 62% making phone calls.
Also, three in five people consider an average of more than two brands. However, more than 50% have no or little idea about the brand or model.
The report also states that the window of being influenced and final decision-making is short. While 85% of new car buyers decide within two months, about 91% of Tier-2 buyers took almost two months.
For new cars, 54% of buyers are aware of connected vehicles and 82% of buyers are also likely to pay premiums as well.
Meanwhile, an interesting trend that emerged from the report is that advanced technologies could replace test drives. Seven out of 10 car buyers agreed that 360-degree videos or VR videos would probably convince them to buy cars without a test drive.
Consumer Insights on used car buying
In the used car segment, the report suggests that 94% of used car buyers research online. Out of this, 98% go for organised used car sellers while 90% for unorganised ones.
Here, the influence of friends in offline research is slightly more, followed by family, new place or promotion at work.
Heavy Google search and YouTube behaviour was observed for used car buyers as well. While 62% of consumers were ready to buy a used car online, eight out of ten people did at least one follow-up action triggered by what was shown in the video for buying a used car.