.jpeg)
Buying a vehicle is one of the most exciting, pricey, and personal purchasing decisions an individual can make. For OEM’s (Original Equipment Manufacturers) and their market research agencies, this means leveraging new technologies to gather more accurate data to give their consumers what they want, when they want it.
Read on to learn more about how automotive brands can leverage market research to do everything from customizing vehicles to the consumer to optimizing after-sales delivery.
Why automotive market research matters
For many, it’s impossible to imagine selling a car without knowing as much as possible about your target market. That’s because your target market determines everything from your vehicle design to your accessories, to dealership locations, and even your CSR initiatives. Market research allows you to ask your target market, both directly and indirectly, what they want. By gathering information about your target market or customer, you get an insight into your customer’s purchasing decisions, buying patterns, and future desires. This allows you to boost not only sales but also project trends.
In the automotive industry, qualitative market research has long been used to improve car services. Regular services are essential to ensure the health of the vehicle and the safety of the customer. Customers spend around 15 hours buying a car but almost 50 hours servicing their car during ownership. So OEM’s need to ensure that services are easy to book, value-adding, and as enjoyable as possible for customers to strengthen brand value and ensure the safety of their vehicles.
However, from a car owner’s view, car services are often seen as time-consuming and expensive. Market research via post-service customer satisfaction surveys gives OEMs the information they need to improve the customer experience and avoid potential pain points.
Quantitative Research: The missing piece in your business strategy?
Unlike qualitative market research, which uses open-ended questions in surveys and interviews to describe your target market, quantitative market research numerically analyzes data collected via multiple-choice surveys and other methods to find patterns and predict consumer behavior. For example, focus groups are a form of qualitative research, while concept tests are quantitative research.
Here are some examples of quantitative research in the automotive context:
- After-sales performance management
- Vehicle health monitoring
- Residual value monitoring
- Long-term vehicle design trend studies
- Sales funnel analysis using all dealership website data
- Predicting future desires and concerns for the customer base
Quantitative research is most valuable in predicting future automotive trends, specifically in the revenue earning sales and after-sales segments. Many industries are shortening their product cycles, from fast-fashion to consumer electronics. In response, modern customers expect their desires to be anticipated and met almost immediately. This presents a unique challenge for the automotive industry’s long-term product cycle. Typically, a redesign takes around four years from concept to sale, with a completely new model being in development for upwards of eight years before coming onto the market. Accurately assessing customers’ desires early in the planning and design process is key to meeting these needs.
Quantitative research uses several data sources, including customer surveys, revenue streams across markets, and competition research, to infer future trends using emerging technology, including machine learning and AI. Armed with this knowledge, automotive manufacturers ensure their new vehicles meet customer expectations when they go on sale for the first time.
Quantitative vs. Qualitative Research in the Automotive Industry — which comes out on top?
While it’s tempting to view quantitative and qualitative research methods as opposing forces, the reality is they work best when used together. Known as a mixed-method approach, this market research strategy is growing in popularity across research fields.
Practical applications of mixed-method are:
- Concept Evaluation
- Car Clinics
- Brand Positioning
- Brand Advertising Evaluation and Research
- Market Segmentation
- Marketing Mix Modeling
- Product Testing
- Choice Modeling Pricing Optimization
- Optimization of Product Launches with Post-Introduction Research
Combining qualitative survey data with quantitative research methods can assist car makers in the global roll-out of electric vehicles. Because of a combination of legislation and growing consumer demand, global electric mobility is set to increase over the next decade. Investing in electric mobility is expensive for OEMs, who can expect to install charging points across their markets. For large auto brands like Volkswagen and Toyota, this includes developing markets in Africa and South America.
Accurately assessing future customer demand in these different markets is essential for a successful and profitable roll-out. Because of the scale of the roll-out, customer surveys alone are not enough. Instead, the automotive industry will benefit from analyzing these surveys using quantitative methods, including nested model analysis and natural language processing.
By using both quantitative and qualitative market research, your customer insights will be both nuanced and give the big picture. If you’d like to know more about how survey data can complement your business strategy, or to request a free demo of our survey software, contact us.
.png){kind=tracking}
