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WOM drives India auto market

News, 23 December 2014

CHENNAI: Indian car buyers tend to visit car dealerships only to validate prior research including recommendations from family and friends, according to a new study.

A report from consultants Deloitte – Driving through the consumer's mind: Steps in the buying process – was based on a survey of 1,813 adults across India, of whom more than 1,500 were car owners.


This found that word of mouth was the most important source of information, the Times of India reported, with social media and sales people at dealerships having relatively little influence despite the efforts manufacturers made here.

More than half those surveyed spent up to ten hours researching which car they wanted to buy, but they were less keen on talking to a dealer: half wanted to spend as little as 45 minutes at a car dealer's. Having made the decision to go to a dealer, however, most (70%) took a test drive.

Male customers typically spend more time on research than female, the report said, and older Generation X buyers spend much more time on research then the younger Generation Y.

Deloitte highlighted the finding that less than 20% of customers conducted research on all the brands they had in their initial purchase consideration set and suggested that potential buyers had a shortlist in mind very early in the process.

This view was given added weight as more than 50% of people considering three or fewer brands for purchase were found not to carry out research for even a single car brand.

Customers readily endorsed products to their family and friends, even those which they did not themselves own. More than half of respondents who considered four or more brands recommended at least one which was different to what they had. And more than 40% of respondents considering three brands recommended at least one non-owned brand to others.

Focus on reference from existing customers, Deloitte recommended: "Given the influence they can have over their friends/relatives, getting them to be the brand ambassadors would be of critical importance." 

Data sourced from Times of India, Deloitte; additional content by Warc staff