Will Auto Portals Work In India?
The Economic Times reports that auto manufacturers in India aren’t too bullish on e-sales; GM India has a low conversion rate for inquiries online, at 12-15%. Maruti had earlier allowed NRIs to purchase cars for their relatives in India, but has no plans for e-sales yet.
Any comments from those running auto portals? Do you actually believe that people in India will buy cars online? What kind of value addition do you do?
Sahad had done an overview of auto portals, here.
A car, whether new or old, is a major expense for most people and they tend to seek multiple opinions and (at least) take a test drive. The Internet is one source of opinions, apart from friends and family: earlier this year, I had blogged my experience, and quite a few people reached the page via search engines; some left comments, others mailed for more details and reliable dealers. Blogs and sites like MouthShut.com have become sources of (mostly) independent opinions, and auto companies would do well to track them for feedback. At the end of the day, these opinions help form opinions, which may affect purchase decisions.
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We have some experience of running a Car portal and working closely with some 150 car dealers in India for more than a year. Automotive space presents multiple opportunities and our experimentation/ understanding here, may be of some use.
Indian consumers will not buy a car online. However, s/he is most willing to get empowered before entering into a buying & selling decision. Even today, Car buying is not a pleasant experience. With all the hassles, haggle and time spent, people often face frictions and come of the experience not feeling so good about it.
There are opportunities to improve Car buying and ownership experience by delivering information and tools which help consumer spend his/her money on the right car at right price and at right place. Today, With car valuation / car recommendation services, today, some 80% consumers report that we have helped them in their car buying/selling experience (And I'm talking at least a few lacs here). Besides, user generated content / reviews etc are a high hit, consumers refer to them a lot.
And our figures says that around 35% of buyers who came online were genuine who finally entered into a transaction.
On the dealer side, used car market is also fragmented and dominated by a large number of small brokers/ dealers (Mumbai will have around 4000 dealers/brokers and Delhi have at least 1000 mid size dealerships). Web actually helps them reduce their cost of acquiring customer and reach beyond their geography. Of course, this was not so obvious to them. Over time, we generated multiple thousands of car purchase inquiries and distributed those free to dealers. And for which their reaction was not encouraging enough. However, today dealers are willing to experiment more with us and are actually paying us to get them consumers through web.
We also see more encouraging figures. Google ad spent of automotive companies this year is around Rs. 10 million (IAMAI & Pinstorm report). I know at least of one comapany who successfully delivered 'lead aggregator' model in US, have actually started working in India on similar lines.
We see more of Maruti/ Tata/ Toyota ads online than ever before. ICICI Lombard have aggressively focused to acquire consumers online.
I think India will see at least one big company in online automotive space.
Ok guys, I am in the market to buy a new car – my second car, in fact. I own a Santro Xing now, and my next one will probably be a C segment car. I am toying with various models and makes – Verna, Honday City, Ford Fiesta, Flair, Scorpio, (would have loved to look at Innova, but slightly off the budget) and so on.
I will make the transaction in next two months. But I would like help in terms of organising the test drives for almost all these cars, the comparison information, and finally the finance arrangement, buying, registration etc…which website can help me?
Cheers
I think, no single website can give you all this today. We may at least provide you with comparison, specifications, pricings and dealer details and may know what financing, rates, EMI etc are possible. And very soon may give you a comparative statement for various finance options available.
We may also help you dispose your used car through listings and by reaching to a network of dealers.
You still got to go to delaerships for a test drive. Only thing is that you will go there with more clarity & information, which may ensure that you get a better deal.
I'm glad that you demand so much from existing auto portals and these expectations makes us work harder to revolutionize the 'car experience' in India.
List of auto portals
http://indiaupcoming.com/tag/auto
Automotive buying experience can never be replaced by portals. The user still needs to have the touch & feel experience, as many have commented above. For many in India, car buying is a dream, just like buying a home.
However, the typical Indian car/bike shopper is very tech savvy, and we see a demand for comprehensive auto portals that provide rich content and help the savvy buyer at every step in the car/bike shopping process. With more consumers on the Internet (thanks for broadband and a flood of low cost PCs), auto dealers and manufacturer are bound to see a good portion of their leads come from online sources. It is those who can adapt to this quickly and optimize their selling/marketing strategies that will reap the benefits in the years of automotive boom to come.
auto portals cannot survive independently. mouthshut.com and user opinions play a critical role in moving consumers to making a decision. carwale.com and all are yet to prove their standing. nikhil is right, we are far from it yet. but as mohit said, auto companies have increased their online ad spends. i hv seen huge auto ad campaigns on mouthshut.com (google adsense) and on ebay.
Hi Guys,
With the increase in Internet adoption, PCs going down in prices, Tata launching its new car in the 1-2 lakh segment, the auto portals are in a good position to capitalize on ad revenues and auto companies will need to step up their online ad spends. It might be tough right now, but I do believe they are truly providing a service and help consumers be informed of the product, doing comparisons, etc. before walking into a dealer and bombarded with all kinds of information.
I am an NRI whos been in the US for the last 16 years and I can tell you that the competition is and will be EXTREMELY stiff between the dozen or so auto portals. Most will not survive. I am currently interested in a buyout of a major Auto Portal for investment purposes. If any of the Portals are on the market and are interested in complete buyouts or investment, please contact me to go through the due diligence and evaluation phase at paul_marwah@comcast.net.
Yeah, we agree that India is still not so online savvy for Automobiles, but this was the case even for e-commerce some 5-6 years ago and every person at that time was saying that who will buy goods online without seeing them etc…but today we have some big names like rediff shopping, ebay etc who dominate this space of e-commerce….so its natural that every big thing starts with a small brick and while we place brick by brick people doubt that this may fall…but time will see tha growth of such portals.
hi, used car industry in india is certainly picking up. Dealers are using portals to buy the used vehicles from financial institutions which are normally repossessed from the delinquent customers. You all have forgotten one site http://www.b2bmotors.in by Ebay. They claim to have more than 8000 dealers in 225 cities. Does anybody knows the size of used vehicle market in India?
Everyone who started an Auto portal in India started it with a big dream. Also with the promises of the market and the growth in economy they will see success. Thus came into existence my web portal <a href=http://www.carsalesindia.com>www.CarSalesIndia.com</a>
We all know there are a only a few web companies that survived the market crash in 2000. Similarly, a few legends will survive in this market over a long period. However, as time flies, we will see more auto portals launching and there will always be big oppurtunities for everyone.
The Indian auto market is brighter than ever, and most buyers are tech savvy who wouldnt mind checking their dream machine online before venturing out for a test drive. They are also interested to know about performance/mileage/features and value for money. Most of the indian buyers go on references or advice from friends/colleagues/relatives.
The current active portals almost provide similar services to the end user, and it is a boon to a car buyer to be able to search for a car online and make appointments over phone. Most of the portals are technically advanced and provide fully integrated SMS services to make communcation between the buyer and seller much easier.
On the new car front, Very soon we will see car manufacturers fully integrating with auto portals to serve online customers in a much better fashion. However, on the used car market, we still have a long way to go before maturity.