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Facebook announces second research report under its Zero Friction Future programme

10-July-2018
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Facebook announces second research report under its Zero Friction Future programme

Facebook, today, announced a second research report for the Indian Auto Industry under its programme called Zero Friction Future. Launched recently, the programme aims to define, understand and mitigate friction in consumer purchase journeys to unlock business growth with use of mobile in media mix. The reports are authored by KPMG in India, based on primary research and insights based on the survey conducted by Nielsen for various industry verticals. Titled “Eliminating friction in automobile path to purchase”, the report highlights, the significant role mobile can play to influence consumer purchase, when buying a four-wheeler or two- wheeler in India.

Speaking on the findings of the report, Sandeep Bhushan, Director, Facebook India and South Asia, remarked “As we start seeing increase in demand for vehicles, our shoppers will spend more time researching their next vehicle on their smartphones than at a dealership. This makes it imperative for automotive marketers to devise their strategies, keeping in mind “mobile” will be the engine that will drive their growth. Through our Zero friction future report, we aim to help automotive brands reduce friction in the consumer journey and suggest relevant mobile marketing strategies to offer seamless purchase experiences to help them win consumers and increase sales.”

The report suggests that by 2022, approximately 8 in 10 (81%) four-wheeler (4W) purchases and approximately 7 in 10 (68%) two-wheeler (2W) purchases will be mobile influenced. Also, approximately one in two four-wheeler purchases (47%) and two-wheeler purchases (45%) will be influenced by Facebook. It further highlights that media friction causes one-third (9%) of the total friction loss (26%) in four-wheeler purchase, and almost half (16%) of friction loss (34%) in two-wheeler purchase.

Commenting on the report findings, Mritunjay Kapur, Partner and Head- Technology, Media and Telecom, KPMG in India said, “Automobile in India is a high involvement aspirational purchase and at the same time, the average age of a car owner, who is more digital savvy and informed, is lowering, making the purchase cycle more challenging for a brand. The new consumers may now evaluate the total cost of owning a vehicle, with that of a cab-hailing service, or a car-leasing service. Automobile OEMs are therefore at a cross-road of managing a consumer’s expectations, while staying relevant and profitable in this highly competitive Indian market. The reports aims at assisting automobile OEMs and marketers in designing mobile or digital driven marketing strategies which could help them in winning a greater share of automobile buyers, at an improved RoI on marketing spend.”

As per the findings of the report, the Indian automobile market is expected to sell 5.6 million and 30.9 million four-wheeler and two-wheeler units respectively by 2022, which translates into a big opportunity for brands to tap into and mobile is the way to go. The study further highlights that mobile is a key catalyst to reduce friction and aid increased customer conversion at lower costs. In the four-wheeler category, increased role of mobile in media mix can help increase 1.2 percentage points of purchase conversion contributing to approximately 1 million units of potential market by 2022, at a 14.7 lower customer acquisition cost. Similarly, in the two-wheeler category, it can help increase 1.6 percentage points of purchase conversion adding to 2.6 million units of potential market by 2022, at 7.8 per cent lower customer acquisition cost.

“We wanted to measure the influence and impact of media touch-points on consumers' path to purchase route – right from the time they have a need to buy a car or a two-wheeler, to finally buying it. We designed the study to get a zoomed-in view on how buyers are now interacting with various media touch-points. Unsurprisingly, mobile is playing a key influencer in the entire journey. While other touch points have their own roles to play in a car or bike buyer's journey, Mobile helps in reducing friction at each stage. We hope this study will give a strategic view on the opportunities being missed by marketers due to media friction and bring in further optimzation.” said Ashish Karnad, Executive Director - Marketing Effectiveness, Nielsen India.

According to the research, top friction areas for different demographic cohorts vary and hence marketers need to customize their marketing strategy accordingly. Some key consumer friction areas across touch points include:

Gender based:

  • Four-wheeler category: Women expect sales assistance, while men demand swift response from brand/dealers.

  • Two-wheeler category: Men seek technical assistance, while women seek clear communication of offers during a purchase. Women buyers look-out for specific product information, test drive and financing options, hinting towards traits of independent auto purchase.

Age specific:

  • Four-wheeler category: Individuals between 35-49 years of age are most likely to pursue a four-wheeler purchase. However, they are also less tolerant to friction and more likely to abandon their purchase after commencing the journey

  • Two-wheeler category: Individuals between 25-34 years of age who intend buying a vehicle are most likely to make a successful purchase, with nearly one-in-two aware decision makers/influencers completing their purchase journey. This age group seeks more information about the product throughout the journey. 18-24 year and 35-49 year prospects, on the other hand, expect more expert advice or information on short-listed set of brands or models and prefer physically testing the product for making informed decisions.

Socio-economic:

  • Four-wheeler Category: An NCCS-A person is 10 times as likely to purchase a four-wheeler as does an NCCS-B person. Both socio-economic groups seek more information on the product, clear advice on next steps of the purchase journey and expert opinion to assist them in decision-making as they move down the purchase funnel.

  • Two-wheeler category: NCCS-A prospects are more than five times as likely to complete two-wheeler purchase as compared to NCCS-B. Targeted information and response from the brand hold more importance for NCCS-B prospects, than financing support.

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