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Consumers unwilling to pay premium for franchised dealer

Research has revealed that consumers are unwilling to pay a premium when buying from a franchised dealer. It also suggested dealer group marketing of its brand has little influence on the car buyer.

In a survey on the Auto Trader website, 61% said they were not willing to pay more for a car from a franchised dealer than an independent. Of those who were, 70% would only pay up to £299.

A further finding in the survey, completed by 5,000 site users, was that dealer branding is not important in a purchase decision.

Revealing the findings at the AM Used Car Market Conference, Tim Peake, Auto Trader commercial director, said: “While franchised dealers can offer tens of thousands of examples of buyers who pay a significant premium over a non-franchise outlet, the lesson is that franchise dealers need to market their brand values, not just their brand.”

A total of 27% of survey respondents said they were prepared to buy a car online without seeing it. A further 33% said they were prepared to order a car online.

Auto Trader’s full analysis of its consumer survey at:
www.am-online.com/files/ATOctoberConsumerSurvey.pdf

 

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