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App users more likely to buy, and buy more: marketing study

May 23, 2014
A customer with a dealership-specific mobile app is 73 percent more likely to buy a vehicle from that dealer than a customer without a mobile app, according to a study released this month by DMEautomotive.
"App-users are not only more likely to buy, but they spend more than non-app-users," said Mary Sheridan, DME’s director of research and analytics.
The app-users spent 7 percent more on their vehicle purchase than non-app-users, according to the study of 360,000 purchase records from 111 dealerships offering a store-branded app for a year.
But it’s not always easy to convince consumers to download dealership-specific apps. Industry experts say shoppers who are cross-shopping dealerships are unlikely to download an app; instead, they would visit the store or third-party websites.
The likelihood of a customer opting for an app increases after a vehicle purchase, when a customer has established a relationship with the dealership.
Still, a post-vehicle-purchase app download helps dealers work on customer retention and service-department marketing through ongoing digital communications.
But that doesn’t mean some in-market vehicle shoppers won’t download a dealership app. Fifteen percent of the vehicles purchased during the study period were made by mobile app users who had no prior service history at that dealership.
"Consumers who have downloaded a dealership’s app quite literally have that dealership’s inventory in their pocket," said DME CEO and President Mike Walther.
Relying instead on the Internet, many of today’s shoppers are avoiding the dealership, and even the test drive, stealthily comparison-shopping dealers/inventory online, and then swooping in to buy when their minds are made up, according to DME, a digital marketing company.
Mobile apps can compensate for that dealership-avoidance, the firm said.