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Los Angeles Automotive Path
To Purchase Study
Rich Tunkel
Senior Vice President
Nielsen Audio
June 2017
Copyright © 2017 The Nielsen Company. Confidential and proprietary.
1
Los Angeles Automotive Study:
Project Background
•Radio’s role in the path to automotive purchase in Los Angeles
Copyright © 2017 The Nielsen Company. Confidential and proprietary.
•Survey conducted primarily online
•Re-interview of Scarborough consumer respondents
•2,237 auto buyers age 18+ in Los Angeles
•Field dates: February 27, 2017 to March 13, 2017
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State of the Automotive Industry
Several good years…
2017 is a challenge!
3
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Three Key Findings
1.
Two Distinct Auto Buying Segments
2.
Reach Drives Sales Results
3.
L.A. Radio Reaches Millions of Auto
Buyers Each Week
4
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Decideds / Undecideds
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5
60% of L.A. Auto Buyers Know What They Want
40% Are Undecided
14%
Knew
vehicle
make I
wanted
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60%
Decided
Auto Buyers
Knew body style,
not make/model
9%
6%
Didn’t know specific
vehicle, but had
certain class of
vehicle in mind
8%
Knew exact
make and model
I wanted
10%
46%
7%
Didn’t know exact
make/model, but had
certain features in
mind
40%
Undecided
Auto Buyers
Didn’t know exact
make/model, but
had certain budget
in mind
Didn’t know what
vehicle I wanted when
started looking
Source: Los Angeles Auto Path to Purchase 2016 Release 2
Q: Statement that best describes how you approached deciding on the vehicle you most recently purchased/leased
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These Two L.A. Auto Buying Groups Differ
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DECIDED AUTO BUYERS
• UNDECIDED AUTO BUYERS
•
Generation X (age 37-51)
•
Millennial (age 20-36)
•
Equal male / female
•
More female
•
Higher income
•
Building income
•
Larger families
•
More likely to be Hispanic
Source: Los Angeles Auto Path to Purchase 2016 Release 2
Decided and Undecided Auto Buyers Age 18+
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Decideds, Undecideds and The Purchase Funnel
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Different Paths to Purchase in Los Angeles
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DECIDED AUTO BUYERS
• UNDECIDED AUTO BUYERS
•
Shorter Decision (many less than 1 week)
•
Longer decision (many up to 1 month)
•
Sole Decision-maker (45% decide alone)
•
Joint Decision (27% decide alone)
•
Purchase New (60%) Used 40%
•
Purchase New (45%) Used (55%)
•
Knowledgeable/Confident (51% score 9 or 10)
•
Less Confident (32% score 9 or 10)
•
Visit Fewer Dealerships (half only visit 1)
•
Visit More Dealerships (most visit 2-3)
•
“Want Vehicle” (31%)
•
“Need Vehicle” (81%)
Source: Los Angeles Auto Path to Purchase 2016 Release 2
Decided and Undecided Auto Buyers Age 18+
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Media Implications
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DECIDED AUTO BUYERS
• UNDECIDED AUTO BUYERS
•
1 Week until purchase
•
1 Month until purchase
•
Urgent and Always On
•
Always On as they decide
•
Shorter Window- Focus on Offer
•
Longer Window- Focus on Dealer Brand
•
Direct them to your website
•
Direct them to your website
Source: Los Angeles Auto Path to Purchase 2016 Release 2
Decided and Undecided Auto Buyers Age 18+
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L.A. Dealer Website Is Most Valuable
Online Resource to Auto Customers
Most Valuable Websites to Auto Buyers
24%
18%
20%
19%
16%
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14%
14%
16%
14% 13%
12%
10%
9%
5%
Dealership website Kelley Blue Book
Dealer
Website
Kelly Blue
Book
Manufacturer
Google / search
website
engine /
Manufacturer
Google
Website
Search Engine
Decided Auto Buyers
9%
4%
Craigslist.org
ConsumerReports
CarFax.com
AutoTrader.com
Craigslist
Consumer
Reports
CarFax
Auto Trader
Undecided Auto Buyers
Source: Los Angeles Auto Path to Purchase 2016 Release 2 : Decided and Undecided Auto Buyers Age 18+:
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Dealer Website: Help Decideds Buy
Help The Rest Make Up Their Minds
Top ways dealer website used to research/shop
UNDECIDED AUTO BUYERS
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DECIDED AUTO BUYERS
• Special offers/Incentives (73%)
• Find actual vehicle listings (81%)
• Locate the dealer (68%)
• Research pricing (64%)
• Request a quote (63%)
• Request a quote (53%)
• Find actual vehicle listings (60%)
• Compare models (50%)
Source: Los Angeles Auto Path to Purchase 2016 Release 2 : Decided and Undecided Auto Buyers Age 18+
12
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Dealer Websites Are Rarely Mentioned In
Los Angeles Ads
•
•
•
•
Offer (price, promotion) - mentioned 5.8 times
Dealer Name - mentioned 5.2 times
Brand - mentioned 2.5 times
Website - mentioned only 1.2 times
Source: Media Monitors review of Los Angeles radio ads from the top 7 automotive advertisers for Q1 2017
(English Language)
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Reach Drives Sales Results
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Even The Heaviest TV Campaigns Miss Customers
Adults 25-54
Adults 18-34
77% reached
23% NOT reached
60% reached
40% NOT reached
2,870 Ford TV Commercials
January 2017
Source: Simulmedia.com Market Insights simulation: National Linear TV Campaign January 2017.
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Optimal Ad Mix Study:
5,000
Campaigns
1,000
Brands
100
Categories
45
Countries
The Advertising Research Foundation: “How Advertising Works, Today” March 2016
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Optimal Ad Mix: 80% Of Ad Buy Should Be
In Traditional Media (TV & Radio)
Digital
22%
Digital
29%
Traditional
78%
Traditional
71%
P18+
P18-34
The Advertising Research Foundation: “How Advertising Works, Today” March 2016
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Sales Grow When Adding Media Platforms
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Incremental ROI of additional media platforms
1 Platform
+19%
+23%
2 Platforms
3 Platforms
+31%
4 Platforms
+35%
5 Platforms
Advertising Research Foundation “How Advertising Works” : Analytic Partners, 2016; Analysis based on over 3,200 campaigns from 2010-2016; Platforms include TV, radio,
display, paid search, online video, PR, out-of-home, and cinema
18
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Radio Delivers Millions of Auto
Buyers in Los Angeles
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Radio’s Weekly Reach of Automotive Buyers is
Greatest of All Major Media in L.A.
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94%
91%
89%
Vehicle
Buyers
83%
76%
45%
Listen to
Spent Any
AM/FM Radio
Time on
Past 7 Days Internet Past
Week
Access To
Mobile
Internet
Watched Any Watched Any Read Any
Broadcast TV Non-Premium Newspaper
Past Week
Cable Past
Past Week
Week
Source: Nielsen L.A. Scarborough R1 2017 (Feb 2016-Jan 2017) Vehicle Buyers = Plan to buy New/Used/Leased Vehicle in next 12 months
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Radio Delivers 1.8 Million People Who Plan To
Buy a NEW Auto In Los Angeles
WEEKLY REACH (of Auto buyers 18+)
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Planned New Vehicle Purchase or Lease – next 12 Mo.
1.8
Million
Reached
Weekly
=
$52 Billion
In Planned
Auto Purchases
(93%)
Source: Nielsen L.A. Scarborough R1 2017 (Feb 2016-Jan 2017) Vehicle Buyers = HHLDS who Plan to buy New/Used/Leased Vehicle in next 12 months
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Radio Delivers 1.5 Million People Who Plan To
Buy a USED Auto In Los Angeles
WEEKLY REACH (of Auto buyers 18+)
Copyright © 2017 The Nielsen Company. Confidential and proprietary.
Planned Used Purchase – next 12 Mo.
1.5
Million
Reached
Weekly
=
$20 Billion
In Planned
Auto Purchases
(95%)
Source: Nielsen L.A. Scarborough R1 2017 (Feb 2016-Jan 2017) Vehicle Buyers = HHLDS who Plan to buy New/Used/Leased Vehicle in next 12 months
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L.A. Auto Buyers: A Lot Like L.A. Radio Listeners
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HEAVIEST USERS FOR EACH MEDIA AMONG PERSONS 18+
LOS ANGELES
AUTO
BUYERS
RADIO
DIGITAL
TV
PRINT
AVERAGE AGE
43
45
39
55
53
NUMBER OF VEHICLES OWNED
2.0
1.9
1.8
1.7
1.8
FAMILY (1+ Child)
43%
51%
35%
28%
30%
WORK FULL OR PART-TIME
69%
73%
72%
36%
52%
USE SOCIAL MEDIA
80%
78%
93%
63%
67%
Source: Los Angeles Path to Purchase 2016 Release 2. Adults 18+ for Auto buyers
Los Angeles Scarborough Release 1 2017 for Media Quintiles
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L.A. Radio Automotive Ads
Drive Vehicle Purchasing
Important in deciding which brand/vehicle to purchase
85%
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74%
70%
L.A. Radio
67%
L.A. TV
Decided
Undecided
Source: Los Angeles Auto Path to Purchase 2016 Release 2 : Decided and Undecided Auto Buyers Age 18+ c
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Company. Confidential
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proprietary.
Galpin Ford Sells Vehicles to the Entire L.A. DMA
Dealer Sales by Zip
1 - 16
17 - 47
48 - 78
79 - 119
123 - 247
Galpin Ford
DMA
25
The Average L.A. Adult Travels
154 Miles In A Vehicle Weekly
and proprietary.
Confidential and
Company. Confidential
Nielsen Company.
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2017 The
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proprietary.
Encino
Audio
in Car
94% of auto buyers are listening to
audio entertainment in the car!
Source for Auto Buyers: Los Angeles Auto Path to Purchase 2016 Release 2
Source for Average Adults: Los Angeles Scarborough Release 1 2017 Adults 18+
South San Diego Bay
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AM/FM Has A 93% Share Of Audio Time Spent
SHARE OF TIME SPENT WITH AUDIO (GROSS MINUTES)
93%
Radio
Streaming Audio
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Company. Confidential
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2017 The
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proprietary.
ADULTS
18+
7%
Broadcast Radio Captures
9 in 10 minutes with in-car audio
88%
Persons
18-34
12%
vs. less than 1 in 10 for streaming audio
Source: Nielsen Comparable Metrics Report Q4 2016 / Adults = P18+
Note: Streaming Audio accounts for listening via PC, Smartphone, and Tablet to content providers such as Pandora, Spotify, etc
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Using Radio with Digital and TV
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L.A. Online Auto Research Occurs
11AM – 8PM; Radio’s Prime Time
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Time of day for online
research/shopping for vehicle
44%
50%
54%
43%
31%
16%
36%
19%
Morning
(5am to 10am)
Midday
(11am to 4pm)
Decided Auto Buyers
Early evening
(5pm to 8pm)
Late evening
(9pm or later)
Undecided Auto Buyers
Hourly Radio Listening for Adults 18-54
Source: Los Angeles Path to Purchase 2016 Release 2. Adults 18+
Nielsen Los Angeles Metro PPM April 2017 PUMM for 18-54 Mon-Friday 6a-Mid
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L.A. Radio & TV Achieve Similar Recall…
Despite Different Investment Levels
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2016 Auto
Ad Spend
TV
Radio
Auto Ad Recall
among auto buyers
$362.7 M
17%
Ad Recall
$70.6 M
13%
Ad Recall
Source: Los Angeles Auto Path to Purchase 2016 Release 2
Nielsen Ad Intel 1/1/16-12/31/16 : dealer associations/dealer ad spend
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L.A. Radio’s “Cost Per Awareness”
Is 4x As Efficient As Television
Cost of recall
$21 Million cost per
awareness point
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TV
Television
Radio
Radio
$5.4 Million cost per
awareness point
Source: Los Angeles Auto Path to Purchase 2016 Release 2
Nielsen Ad Intel 1/1/16-12/31/16 : dealer associations/dealer ad spend
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A Radio-Only Schedule in L.A. Delivers 1.5x More
Auto Buyers Than a TV-Only Schedule
Reach of Adults 25-54 Auto Buyers, Los Angeles DMA
Copyright © 2017 The Nielsen Company. Confidential and proprietary.
62%
39%
100% Radio
100% TV
How to read: $335,000 spent only on AM/FM radio delivers 62% of adults 25-54 in the Los Angeles DMA vs. 39%
if spent only on TV
Source: Nielsen Commspoint Research US 2016, Adults 25-54, 1 week net reach. Budget determined using Nielsen AdViews CPP Data, Q1 2017. Assuming a $650 CPP for
Los Angeles Radio and a $3,350 CPP for Los Angeles Television. Data reflects Automotive – Passenger Vehicles category.
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Radio Improves The Reach of L.A. TV Campaigns
Adults 25-54, Los Angeles DMA
Sweet Spot
+50%
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52%
58%
61%
63%
64%
65%
65%
30% AM/FM
radio / 70% TV
40% AM/FM
radio / 60% TV
50% AM/FM
radio / 50% TV
60% AM/FM
radio / 40% TV
70% AM/FM
radio / 30% TV
39%
0% AM/FM radio 10% AM/FM
/ 100% TV
radio / 90% TV
20% AM/FM
radio / 80% TV
How to read: $335,000 ad spend, with a mix of 20% AM/FM radio and 80% TV reaches 58% of
adults 25-54 in the Los Angeles DMA every week.
Source: Nielsen Commspoint Research US 2016, Adults 25-54, 1 week net reach by GRP level. Budget determined using Nielsen AdViews CPP Data, Q1
2017. Assuming a $650 CPP for Los Angeles Radio and a $3,350 CPP for Los Angeles Television. Data reflects Automotive – Passenger Vehicles category.
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20% Radio = 42% More Purchases
And Greater Brand Impact in L.A.
Brand health metrics increase when allocating 20% of TV budget to radio
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Awareness +48%
Consideration +39%
Purchase +42%
Advocacy +47%
Source: Nielsen Commspoint Research US 2016, Adults 25-54, 1 week net reach by GRP level. Budget determined using Nielsen AdViews CPP Data, Q1 2017. Assuming a $650
CPP for Los Angeles Radio and a $3,350 CPP for Los Angeles Television. Data reflects Automotive – Passenger Vehicles category.
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5 Key Takeaways
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A.U.D.I.O.
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A.U.D.I.O.
Always-on media strategy
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A.U.D.I.O.
Utilize More Than One Media
38
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A.U.D.I.O.
Drive Vehicle Sales With Radio
39
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A.U.D.I.O.
Individualize The Message
40
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A.U.D.I.O.
Optimize Reach With 80%
Broadcast Media
41
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Always On
Utilize Multiple
Drive With Radio
Individualize Message
Optimize with Broadcast
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For more information
Other data available or future studies:
Carol Edwards 410-913-1037 [email protected]
Copyright © 2017 The Nielsen Company. Confidential and proprietary.
Nielsen’s automotive data solutions:
Carl Enroth 646-654-4749 [email protected]
About this presentation:
Rich Tunkel 646-362-0246 [email protected]
About the SCBA:
Thom Callahan 323-930-5597 [email protected]
Liz Fancher 626-627-9223 [email protected]
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Copyright © 2017 The Nielsen Company. Confidential and proprietary.
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