THE AUTOMOTIVE INDUSTRY REPORT
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1 THE AUTOMOTIVE INDUSTRY REPORT Q4 2017
2 THE REPORT EXPLAINED IgnitionOne uses an index for every metric. The first year, quarter or month in the graph is set to a value of 100. Next to global statistics, the automotive industry report is broken down regionally into North America, Europe, LATAM (Latin America), and Asia. Numbers are presented according to the North American and European car segmentations.
3 EXECUTIVE SUMMARY Site Visits The automotive markets in North America, LATAM, and Asia saw a 24% decrease in site visits in Q4 compared to Q Engagement The quality of the traffic was lower in Q4 than Q3. In fact, within the quarter, December showed the lowest engagement level of car site visitors. Lead Volumes The number of leads generated on Automotive OEM websites were 4% higher in Q4 compared to Q3 despite lower engagement. This can be contributed to marketers initiatives to push sales to higher funnel visitors with incentives in Q4. Segment Trends SUVs are again attracting more people. For smaller cars, it looks like the buying process is shortening. Less engagement still resulted in more leads, indicating a quicker pace through the sales funnel. More and more conversions are happening on mobile devices. Q4 being more than 25% higher than Q1 17. Desktop leads saw a decline of almost 15%, comparing Q4 with Q1 last year.
4 SITE VISITS SITE VISITS: GLOBAL BY QUARTER When looking to historical data, automotive trends tend to slow down in the fourth quarter of the year. Therefore, we anticipated relatively low site traffic. However, the site visit strength from Q3 carried over to Q4. One thing was very clear: December site traffic was 24% lower than January Needless to say, the automotive industry will be happy when it is January again.
5 SITE VISITS: REGION BY QUARTER Similar to Q3, the regional site visit differences were distinct. LATAM and North America s site visits were down 20% in Q4 compared to Q1; whereas, site visits in Europe remained flat. Asia was the only region to see a decline in site visits. On the positive side, December traffic in Asia was higher than November, so we see early signs that the trend is turning.
6 SITE VISITS: NORTH AMERICA SEGMENTATION SHARE BY QUARTER According to North-American car segmentation, more and more visitors are looking at mid-size cross-over SUVs, full-size SUVs, and full-size pick-up trucks; whereas, mid-size and compact cars saw a decline in site visitors share of almost 20% in Q4 compared to Q3.
7 SITE VISITS: EUROPE SEGMENTATION SHARE BY QUARTER European car segmentation trends stayed consistent from Q3 to Q4. When looking to the data, one thing sticks out: SUVs are getting more and more attention. In fact, for the first time ever - more than 1/3rd of all automotive site traffic was related to SUVs, equalling the site traffic of mini, small and medium cars collectively. These segments declined from more than 40% traffic share in Q1 to 34% in Q4.
8 ENGAGEMENT The IgnitionOne Score describes the quality of site traffic - how engaged is a user with the automotive brand visited? ENGAGEMENT: GLOBAL BY QUARTER Q remained the highest quarter for engagement in The quality of site traffic was lower in Q4 with an engagement level index of 93 compared to 97 in Q3 (Q = 100). Within the quarter, December showed the lowest engagement level of car site visitors, scoring an index of just above 90. Looking to historical data, we expect this to increase in January 2018.
9 ENGAGEMENT: HIGHLIGHT OF THE NORTH AMERICA SEGMENTATION BY QUARTER When observing the quality of site traffic broken down, it is clear that only a few segments experienced a higher than average engagement in Q4. As engagement can be interpreted as a proxy for buying intent, lower global traffic and lower traffic share in combination with lower engagement signals that sales will go down in the near future. This plays true currently for compact cars, though compact crossover interest is increasing.
10 ENGAGEMENT: EUROPE SEGMENT SHARE BY QUARTER When focusing on EU car segments, where most volatility in site traffic occurred (mini/small), it s the mini car segment that is doing well in terms of engagement. We expect small cars to suffer more from a decline in traffic share, as this is not offset by a higher average engagement. Although the quality of traffic on SUVs declined by around 10%, the significant increase in traffic share will cause a positive net effect on future sales.
11 LEADS AUTOMOTIVE LEADS INDEX: GLOBAL BY QUARTER The number of leads generated on Automotive OEM websites were 4% higher in Q4 compared to Q3 despite lower engagement. This lower engagement was clearly offset by higher traffic and promotional incentives in Q4.
12 AUTOMOTIVE LEADS INDEX : REGION BY QUARTER When looking at lead share regionally, we see that the global spike in leads was largely due to a significant spike in LATAM, skewing the data. This could be caused by the economic growth in LATAM and pent up demand for purchasing a car, which signifies a rebound for LATAM.
13 AUTOMOTIVE LEADS INDEX : NORTH AMERICA SEGMENTATION BY QUARTER When looking at the global number of leads according to North American car segmentation, the share of Compact SUV leads grew significantly in Q4 due to a very strong October. One thing is consistent - the full-size pick-up truck remains very popular.
14 ENGAGEMENT: EUROPE SEGMENTATION SHARE BY QUARTER According to the European car segmentation, Mini and Compact SUV leads have started to decline in Q4 after a strong Q3. Only the Large SUV segment was able sustain growth. The leads for mini cars, small cars, and medium cars grew as well in Q4. However, for almost every segment, the number of leads within the quarter have declined towards the end of the year.
15 LEADS BY DEVICE TYPE In this report, we also looked into the types of devices that are being used by website visitors, when they request a brochure, a quotation, a test-drive, or any other way of raising their hand to get into contact with their local dealership. Surprisingly, desktop has recovered a bit in Q4, after a steady declining trend. Apparently, the desktop computer gained from tablets, where mobile usage still continues to grow usage share.
16 CONTRIBUTING AUTHORS Rachel Pierson Global Director of Strategic Accounts Rachel works closely with the marketing teams of major automotive manufacturers and their agencies to develop strategies and solutions to increase marketing performance. Rachel has 15 years of automotive marketing and advertising experience. Stephan van den Bremer Head of Automotive Stephan has worked in the automotive industry for over thirteen years. As IgnitionOne s Global Head of Automotive, Stephan is responsible for driving business growth in the automotive vertical, focusing on expansion and performance excellence. He has held various sales and marketing positions within the Volkswagen Group in the Netherlands. Prior to joining IgnitionOne, he led Autobytel Netherlands, focusing on online lead generation and CRM solutions for the automotive sector. Stephan.Vandenbremer@IgnitionOne.com
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