More Australians seeking car loans online
Dealerships need more compelling finance options.
A new research report highlights the need for car dealerships to recognise the benefits of the online automotive marketplace and adjust their marketing and sales tactics in order to capitalise on affordability, increased buying intentions and low interest rates.
Last week we reported the number of Australians intending to buy a new car has fallen since the beginning of the year, although the industry still anticipates a record number of new vehicle sales.
ACA Research released the fifth edition of its Automotive Finance Insight (AFI) report this week, revealing customers are effectively using the internet to streamline the process of deciding on a shortlist of vehicles, narrowing down their final choice in an average four weeks.
Around two-thirds (66%) of Australians spend more than six hours researching vehicles online, resulting in a more informed customer who's likely ready to buy.
Almost half (46%) seek and obtain pre-approval from at least one lender prior to visiting a dealership.
This isn't surprising, considering the research shows just one-third (34%) of customers currently utilise dealership finance, down from two-fifths (40%) in 2013.
More than one-tenth (16%) of customers used an online broker to secure finance. ANZ and Macquarie Bank (including Esanda) were the most popular choices.
However, the proportion of customers completing finance applications online has settled at just 18%, exposing a gap in the process.
Previous studies show Aussies feel anxious, uncomfortable and pressured when visiting a dealership.
Vehicle financiers need to find a way to intercept customers before they arrive and provide a more compelling finance offer in order to reclaim lost business.