How to Meet Evolving Consumer Needs to Stay a Step Ahead
It’s no secret to any modern dealer or anyone in the automotive industry… The future of car buying is evolving rapidly, driven by technological advancements and shifting consumer expectations. Even the quickest of reviews of the last five to ten years indicate a massive transition towards a more digital and customer-centric approach, nearly redefining the entire purchasing experience.
So, to help you plan for 2025, as well as start building for what consumers say they want, need and will demand in the future, we’ve asked Angela Drake, Cox Automotive’s Director of Research and Market Intelligence to help guide us through the top five macrotrends from Cox Automotive’s Evolving Consumer Study.
The findings will have a transformative impact on consumer behaviors and expectations and ultimately how you do business. From the surge in omnichannel shopping, to the increasing emphasis on social responsibility, discover how these influential trends will reshape the way consumers shop, interact with brands, and make purchasing decisions in the coming years. Ensure you’re taking the necessary actions today that these results call for, so that you’ll be aligned for more successes in the future.
Five Key Macrotrends Shaping Consumer Needs
The research conducted by the team at Cox Automotive revealed five significant macrotrends that are redefining consumer behaviors and expectations transforming how they shop, interact and ultimately purchase from you.
Defining moments from the previous decade that are impacting the evolving consumer landscape include things we’re all too familiar with: the global pandemic, technological advancements, shifting economic conditions. Although you’ve heard this a million times, we believe it deserves a repeat:…The pandemic has had a profound impact over the past four years, fundamentally altering consumer behavior and accelerating many of these trends.
According to the study, as Angela Drake points out, while the phrase ‘the new normal’ may feel a bit overused, it is more than accurate. How much will these macrotrends impact the future of car buying? According to the study, 80% of consumers predict that each macrotrend will affect the way they shop and buy vehicles over the next ten years.
Understanding these trends is crucial for dealers, OEMs, and industry stakeholders as they navigate the evolving landscape of consumer needs. By closely examining these macrotrends, we can gain valuable insights into the future of car buying and the broader implications for the market.
80% of consumers predict that each macrotrend will affect the way they shop and buy vehicles over the next ten years.1
Trend #1: Transition to Omnichannel
The Findings: A shift in the way consumers prioritize flexibility leads to a more comprehensive online experience. Consumers are rethinking how they use and shop for products. According to Drake, “Nearly 7/10 vehicle shoppers intend to complete some or all their purchases online.”
“Nearly 7 out of 10 vehicle shoppers intend to complete some or all of their purchases online.“1
With consumers’ changing expectations, it calls for a shift towards a more digital and integrated shopping experience. This transformation is driven by the need for convenience and the increasing comfort with online transactions, which have become a cornerstone of modern consumer behavior.
Actions to Take: When we take a closer look at the 70% of those who prefer an online experience, there was no single car-buying model that stood out as a clear winner. Fragmentation tells us that you must meet your consumers where they are at and make it easier for car-buyers to buy from you. You will need to provide the option to move back and forth from online to in-store, creating a seamless shopping experience. A failure to do so will send those consumers to your competitors in a heartbeat.
Trend #2: Trust and Transparency
The Findings: With the increased sharing of sensitive data online, consumers are growing more cautious about their digital footprints. This heightened concern over data privacy and protection is expected to continue, influencing how companies manage and secure customer information.
Actions to Take: The demand for completing purchases online is growing, but it won’t be as simple as flipping a switch in your business. You must use the power of data to re-define personalization. You have so many insights at your fingertips that can be used to execute hyper-personalized and targeted campaigns.
Trend #3: AI and Automation
The Findings: Another significant trend is the rise of Artificial Intelligence (AI) and Automation. Driven by vast amounts of data, consumers anticipate that AI will significantly advance over the next decade, becoming an integral part of their daily lives and interactions with brands.
Actions to Take: Your data is a two-way street. AI and automation not only enable your business to execute those highly impactful and targeted campaigns, but they provide consumers will value. When used well, consumer data can make them feel heard, understood, and improve the likelihood that they’ll share their information again in the future.
Trend 4: Affordability
The Findings: Affordability remains a critical factor in the automotive industry, but a noticeable shift has emerged, highlighting consumer concerns regarding their financial priorities.
The 2024 Cox Automotive Consumer Market Update reveals that 59% of consumers believe vehicle ownership is becoming prohibitively expensive. This growing apprehension about the cost of owning a vehicle is prompting consumers to reevaluate how they allocate their income, which could significantly impact traditional vehicle ownership models.
As a result, there may be an increased interest in alternative options such as leasing, car-sharing, or subscription-based services, reflecting a more flexible and cost-effective approach to vehicle access. And, 1 in 4 consumers are looking to move towards more non-traditional ownership options in the future1.
1 in 4 consumers are looking to move towards more non-traditional ownership options in the future1
Actions to Take: The power of data and automation doesn’t just help you move more cars from your lot. It can provide insights that empower conversations beyond traditional ownership options. You can automate some of the more mundane tasks that eat up your time to shift the conversation to more impactful and meaningful topics.
Trend #5: Social Responsibility and The EV Path
The Findings: Consumer behavior studied over the previous decade indicates that businesses are being held accountable for their impact on society and the environment. This growing importance of social responsibility reflects a shift in consumer values, where ethical practices and sustainability are becoming key factors in purchasing decisions.
Companies are now expected to contribute positively to their communities and demonstrate a commitment to environmental stewardship, which in turn influences consumer loyalty and brand perception.
In the automotive industry, this trend has led to increased demand for electric vehicles (EVs) and more sustainable manufacturing practices. Companies are investing heavily in research and development to produce vehicles that reduce carbon emissions and rely on renewable energy sources.
Additionally, automakers are being scrutinized for their supply chain practices, prompting a shift towards more ethical sourcing of materials and better treatment of workers. This shift not only addresses consumer expectations but also positions automotive companies as leaders in the movement towards a more sustainable and socially responsible future.
Actions to Take: As consumers pay more attention to the ways your business contributes to society, celebrating your causes is a great way to build your brand. Communicate the causes you support through social media and let your consumers know that you’re part of the community.
Be Ready for the New Era of Consumer Evolution
The Evolving Consumer study has revealed a dynamic and shifting playing field for both the consumer and the automotive dealer. Yet, as Jade Terreberry, Senior Director of Strategic Planning for Autotrader and Kelley Blue Book and host of the UnJaded podcast points out, “Change and disruption are the catalysts for the future.”
These trends reveal so much about what we may expect about the next ten years of the automotive industry that it’s important to look at the direction future car buyers are moving towards—and for dealers, especially, what specific actions they should take. Angela Drake points out that up to 70% of car buyers are looking for a non-traditional, online solution for their future purchases.
However, the story of that data may not belong to a single model (or a simple solution) for purchasing a car. Everyone has preferences between online and offline and, five to ten years from now, the data will be very different as GenZ and Millennial buyers make up a larger segment of this audience. You have to meet your buyers where they are, or your competitors will. Selling vehicles in the way your buyers want, prefer, and demand is the true key to meeting (and keeping up with) the evolving needs of today’s consumer.
For the Road Ahead
Consider this only the beginning. New technologies that benefit your dealership and your customers are always right around the corner. In fact, keeping up with new technologies is part of the fun of running a successful dealership. It’s also the best way to stay a step ahead of change and keep your dealership from falling behind.
With every Autotrader listings package, you’ll gain access to nVision, an invaluable tool for dealers and their professionals. nVision provides online training, industry insights, key reporting tools, shopper behavior data, and more. This comprehensive resource ensures you have the knowledge and tools needed to leverage the latest technologies effectively.
Autotrader provides you with qualified leads for people who want cars. We have the data that connects and activates your data, and we have the shoppers. We know what they want, and our goal is to match them with our dealer partners, driving quality leads that have the highest gross profit on average industry wide. We connect you with customers virtually, to move shoppers to you, so that you can focus on building and letting your brand shine.
Want to watch or hear the podcast episode recorded with Angela Drake to go deeper on this hot topic? View or listen to the UnJaded episode now available.
1 2024 Cox Automotive Evolving Consumer Study
The Author
Angela Drake, Director of Research and Market Intelligence, Cox Automotive
