In 2015, U.S. car sales hit a record high with over 17.5 million cars and light trucks sold. This number marked a 5.7% increase from 2014. Although new car sales are currently quite high, the average age of cars on the road has continued to widen. A recent IHS Automotive survey reported that the average age of cars on the road was 11.5 years old. Additionally, there were approximately 14 million cars that were over 25 years old in 2015, compared to only 8 million back in 2002.
With the average length of vehicle ownership increasing 60% in the last ten years, the automotive aftermarket sector has seen tremendous growth as more older cars are being brought in for repairs. As illustrated by the graph below, cars that are older than 11 years make up a major portion of the the cars being brought into repair shops for maintenance.
Additionally, these same older cars account for far more of the pricey repairs that are north of $1,000.
With the average aging of cars, as well as increased sales of new cars, the door is wide open for companies in the automotive aftermarket field to rake in major profits. In a 2017 press release, Global Industry Analysts projected the global automotive aftermarket industry to exceed 1 trillion dollars by 2022.
However, these extremely promising projections will only benefit service providers that are able to establish authentic trust with their customers. Even when the suggested repairs are necessary, customers are frequently unwilling to pay for them due to a lack of genuine belief in their dealer. The solution to this is actually quite simple ー show the customer what is wrong with their vehicle. In the past, mechanics would take customers into their workshop. However, this is no longer practical due to the various hazards around the workshop that could lead to injury and possible lawsuits.
The solution of today is video. Video can show a technician inspecting the vehicle, while providing a running commentary that explains to the customer what they are seeing. In a 2017 survey of 570 respondents, Wyzowl found that 72% of customers would rather learn about a product or service through video rather than text. This makes perfect sense to why customers are far less likely to approve extra work when it is conveyed to them via an email or typed up packet. Furthermore, 97% of marketers said that video has helped them increase user understanding of their product or service and 76% have seen it lead to an increase in sales. After installing the TruVideo texting and video platform in February of 2018, Nelson Mazda of Tulsa saw their average for labor on customer pay ROs rise from $104 up to $170 in just 3 weeks, marking a 64% increase.
If your shop hasn’t considered video yet we would urge you to take a look at the options out there.
Truvideo is a dealership video & texting communication tool that is designed to integrate with your existing systems. To learn more visit us at www.truvideo.com
To learn more about the power of video, check out our infographic here
- “A Look At Trends And Statistics In The Automotive Aftermarket Industry 2017 | V12data.” V12data.com. N. p., 2018. Web. 21 June 2018.
- Detail, Article. ” New Business Models To Drive Aftermarket In India .” Autocarpro.in. N. p., 2018. Web. 3 Aug. 2018.
- Hayes, Adam. “The State Of Video Marketing In 2018 [New Data].” Blog.hubspot.com. N. p., 2018. Web. 26 July 2018.
- “MCP – 1036: Automotive Aftermarket – A Global Strategic Business Report.”Strategyr, www.strategyr.com/pressMCP-1036.asp.
- Wyzowl. (2018). Video Marketing Statistics 2018 (Original Research). [online] Availableat: https://www.wyzowl.com/video-marketing-statistics-2018/ [Accessed 26 Jul. 2018].