Women buying cars - Trends

Part
01
of three
Part
01

United States: Trends in women buying cars

Women have become a very important segment of the United States car market. There are 1.4 million more registered women drivers in the US than men. Overall, women buy 63% of all new cars in the US, purchase 53% of all used cars and influence 85% of all purchase decisions. In addition, women request 65% of all car service work. It is estimated that women spend over $200 billion each year on buying and servicing cars.
We have identified the following trends related to women’s car buying in the United States: trends related to car features, demographic trends, trends related to car type and trends related to the car purchasing experience.

Trends related to car features

Women look for different features than men when they are evaluating which car to purchase. Fuel efficiency, safety and reliability are more important to women than men. This is confirmed by a 2017 survey where women were asked to rank important car features and the top 5 attributes were related to safety and efficiency as follows:
83% Highest safety Ratings
75% Exceptional gas mileage
68% Side airbags
54% Rear view camera
53% Exterior Technology
In contrast, men are image conscious. They are more interested in the interior layout, exterior styling, technology and the ruggedness of the vehicle.
Women also choose different car colors. They prefer more traditional car colors, while men will choose brighter, more unusual colors.
Understanding what women are looking for in a new car is an important trend because 74% of women currently feel misunderstood by car marketers.

Demographic trends

Regarding demographic trends we looked at two main areas: age and marital status.
Age impacts what drivers want when purchasing a car. For drivers in their twenties, the most important factor is cost as 45% of drivers are most concerned about the price of the car. Practicality becomes important to car drivers in their thirties: 34% of drivers look for the most fuel-efficient vehicles, 27% consider the number of seats in the vehicle, and 20% take the cost of insurance into consideration. It is also during their thirties when women begin to make the majority of the purchasing decisions with 67% of them choosing a car based on family and children’s needs. Drivers in their forties often have more disposable income, with 38% reportedly more focused on brand image and 49% looking for something that is fun to drive, like a convertible.
The marital status of women car buyers has changed and now 40% of women buyers are not married. These buyers have more disposable income and are independent, as they are the sole decision-maker on their car purchase,
Women are twice as likely as men to be undecided about the type of car they need. Therefore, understanding how demographics such as age or marital status can influence car buying for women is valuable when targeting them in marketing campaigns.

Trends related to car type

Women are now buying almost 50% of all compact and midsize cars, and 45% of all light trucks and SUVs. However, women are less interested in European sports cars and upscale SUVs as men make about 90% of these purchases.
Since women are more concerned with practicality when purchasing a car, this has impacted the types of cars now been manufactured. The cross-over SUV category was developed largely because women wanted something sportier than a minivan that was easier to drive than a truck. Additionally, the small SUV market has seen very strong sales to women. Between 2010 and 2015, the sales of small SUVs increased by 34% compared to only 22% for men; and for premium small SUVs, the increase was an incredible 177%.
Since some car companies are seeing a decrease in sales, this has become an important trend since targeting women buyers with the right car type can clearly increase sales.

Trends related to car purchasing experience

Unfortunately, most women in the United States have a poor experience when purchasing a car. 66% of women buyers said that their purchasing decision was “entirely up to me”, but 77% of women still bring a man with them to avoid being exploited when purchasing a car. This fear of being exploited does seem to be based in fact as dealers charge women $200 more than men.
There are also differences between how men and women purchase a new car. Women do more web-based research than men and they also take longer to make a purchasing decision. On average, women take 75 days, while men take 62 days.
Women are now a large percentage of the car-buying population and 60% of women who leave a dealership without buying a car never return. Thus, improving the car purchase experience will be a key trend in increasing sales in the future.

Conclusion

Women buy 63% of all new cars, influence 85% of all purchasing decisions and are responsible for 65% of car service requests, which totals approximately $200 billion per year. To market effectively to this influential group, it is essential to understand basic trends such as what they need at different milestones in their life. It is just as important to recognize that women are looking for different attributes in their cars than men, wanting different types of cars and their purchase process is different.

Part
02
of three
Part
02

Europe: Trends in women buying cars

We identified trends that show that more European women are driving and purchasing vehicles than ever before; that they prefer smaller, more economical vehicles; that they aren’t using vehicle technology to the fullest extent, but are more interested in technologies like autonomous cars; and that they are increasingly using social media as a tool for car-buying research. Additionally, we’ve noted trends in increased marketing towards women, and a greater number of women working within the industry itself.

METHODOLOGY & FINDINGS

We began by searching for general and demographic-specific trends in auto purchases in Europe. Extensive information was found on the global and US markets. For the European market as a whole, a wide range of statistics was available, however, statistics and information with a demographic focus were scarce. This search included an extensive advanced search of the European Auto News site, which is a premier site for the industry in that region, and which also turned up no relevant or useful results. We located another report from Green European Journal, which provided an extensive overview of “The Future of Europe’s Car Industry,” though nothing was included on demographics or shifts/trends related to gender. We then expanded our focus and conducted targeted searches on each of the five major markets within Europe: UK, Germany, Spain, Italy, and France.
Our searches turned up no specific demographic or car-purchasing behaviors studied in Spain, Italy, or France within the past two years. Limited demographic information was found for the UK and Germany, as well as Europe as a whole. Although a vast variety of statistics are available for Europe, it appears that very little demographic and gender-specific research is conducted on auto sales in this region.
Despite the limited availability of information, we were able to identify six trends relevant to your query. For each one, we have provided statistical and informational support to prove the trend. It is important to note that some of this information is not gender-specific and some of it is more globally-focused, though still applies to the overall trend itself, so it was included to give you the most comprehensive explanations possible.

TREND: MORE WOMEN ARE DRIVING

Research from CDK Global calls women the “largest emerging market” in the auto sales industry. A paywalled report from 2014, although more-dated than we typically use at Wonder, provides the most-recent comprehensive insights into global women’s car-purchasing behaviors. Although the entire report is not publicly-available, insights note that, “Women are dominating the car-buying process, which is evidenced by an increase in license holding. In the United States, female drivers now outnumber male drivers. Europe will soon follow.” They note that women are the “rising power” in the automotive buying value chain, and encourage auto manufacturers and dealers to take note of this and adjust their strategies accordingly. Recent research from Car Insurance-Arrive Alive supports this in noting that, in the UK specifically, driver’s license applications by women have increased, while those for men have decreased over the last few years. They also note that, “in Germany, women hold more than 40% of licenses and the rate is rapidly increasing”. Statistically speaking, Auto News reports that, “The number of women owning cars in the U.K. jumped 66 percent in the decade through 2016, official figures show, almost triple the rise in for men. In Germany, Europe’s biggest car market, women buy about a third of all new vehicles and in France 37 percent.
Even though more women are driving, research shows that most women find the experience of going to a car dealership daunting, with This Money noting that only 22% “of women said they felt confident about going to buy a new car”. A report from Deloitte shows that most European new car buyers least like the amount of paperwork involved in car purchases, and highly dislike the process of haggling over the price. Since women often feel less confident in the negotiating process, this is not surprising, though it does indicate a specific strategy shift that auto dealerships should apply if they hope to continue competing in the European market.

TREND: INCREASED MARKETING GEARED SPECIFICALLY TOWARD FEMALE BUYERS

Research shows that, globally, women influence between 80% - 85% of all car-buying decisions. Additionally, women purchase 65% of all new cars bought globally. Because of this, a number of sources (like BuzzBusiness, for example) indicated that auto manufacturers and auto dealerships are increasing the marketing they do that is geared toward women and making females a priority in their overall marketing strategies. This is occurring globally, though especially in Europe, since research shows that more women are getting behind the wheel (of their own cars) than ever before.
Research by CDK Global (detailed by Driving Sales) shows that women approach car-buying differently than men, and advertising should be geared directly toward how women buy cars. However, they also note that “most dealerships are afraid to acknowledge gender” for fear “that treating women differently will signal that they’re not treating them equally”. To market (and sell) cars most successfully to women, understand how women approach car purchases as identified by eMarketer: (A) Women prioritize “reliability, safety, and fuel economy” in their purchases. (B) Women connect less to technical descriptions and more to descriptions that help them understand what the experience of driving the vehicle is like. (C) Women are least concerned with the prestige of owning a vehicle, distinctive styling, or the latest technology.
Research on the UK market from This Money notes that, although females play a significant role in car purchases, they are often “put off by adverts and dealers”. In fact, only 29% reported that they believed vehicle advertisements were geared toward them, and a whopping 64% agreed that “most motors advertising is designed to appeal to men”. 51% of women reported that most car ads featured people to whom they did not connect or relate, and 46% indicated that most car ads didn’t provide the information they most wanted to know. The research shows that this is “because women are far more interested in the practicalities of ownership, ranking the importance of insurance, servicing, and tax higher than med do”. Only 41% of women reported finding vehicle advertisements useful in car-buying decisions. These findings indicate why so many auto manufacturers and dealerships are starting to focus more specifically on their female demographic.

To support this trend, Auto News reports that, for the 2018 Geneva Auto Show, several auto manufacturers will be replacing their typical “booth babes” with both male and female models. This is in response to the global #metoo movement, as well as to better market to women. Additionally, they report that, “Larger automakers including Toyota Motor Corp. and Nissan Motor Co. have also said they will cut back on the coquetry in Geneva, marking a potential sea change for an industry that has long pandered to male customers by using attractive women to sell cars.”

TREND: WOMEN ARE NOT USING VEHICLE TECHNOLOGY AS OFTEN AS THEY COULD BE

As noted in the last section, one of the factors least-concerning to women is the technology offered in their vehicles. In support of these findings, a study conducted in Europe, North America, and China showed that 25% of car owners do not use the technology (and/or connected) features in their vehicles, with 11% of these individuals not even knowing what technological capabilities their vehicles have. Additionally, they report that 56% of new car purchasers who activated various technologies in their vehicles do not plan to review those services in the future.
Interestingly, the research also indicated that “CASE innovations (connected, autonomous, shared, and electric driving)” were more-widely accepted and utilized than other technologies. In Europe, for self-driving cars, acceptance levels reached 36%, for electric vehicles (full and partial), acceptance levels reached 53%, and for car-sharing, acceptance levels were lowest at 21%. In Germany, research from Green Car Congress shows that women (and more frequently older women) are less interested than men in buying electric cars. This is despite the fact that Auto News reports that a trend in Germany points toward “a rise in private consumption [of electric vehicles] helped by manufacturers’ incentives to trade in older, dirtier diesels”.

TREND: MANUFACTURERS & DEALERSHIPS ARE HIRING MORE WOMEN

Since more women are buying cars (or have more say in the buying process), car dealerships all over the globe are increasingly focused on hiring more women to work showrooms, as well as promoting more women to management positions. BuzzBusiness notes that, “Car makers are responding proactively to these trends, promoting women to senior positions and putting them at the heart of their marketing efforts, as well as increasing investments in technological innovations.”
Research from Catalyst published in 2016 notes that in EU countries, only 24% of auto manufacturing employees are female, with the UK showing the lowest percentage at 16%. In wholesale/retail sales and repair, women only hold 16% of the positions available. In this instance, Italy shows the lowest percentage overall at just 14%. Overall, they report that women are under-represented across the industry as a whole, though especially in entry-level and senior management positions. With this trend toward hiring more women, we’re likely to see these numbers increase over the next five-to-ten years. Auto News reports that, since they first began reporting on leading women in the European Auto Industry in 2008, many changes have taken place (with regard to female employment). They note that, “today, two women run European automotive brands, and nearly every brand in the region has women in key positions”.

TREND: WOMEN PREFER SMALLER, MORE ECONOMICAL VEHICLES

Since more women are driving and buying cars, sales statistics show that they prefer smaller, more economical vehicles. Research from ACEA shows that 40% of passenger cars sold in Europe in 2017 were identified to be sized “small”, with an additional 27.7% being sized “lower-medium”. A separate report from ACEA showed that the demand for passenger cars in Europe increased by 4.7% in the first half of 2017 alone. Although most major European markets saw this increase (including Italy, Spain, Germany, and France), in the UK, there was actually a decline in new car registrations. This is not surprising considering the anticipated 2018 Brexit, which industry experts report will cause a significant drop in UK new car sales. Since the UK is the second largest new car sales market in the EU (Germany ranks first), the entire remainder of the European region is expected to see an uptick in new car sales.
Diesel is still the most popular fuels for new cars in Western Europe, with ACEA reporting that “roughly 45% of buyers [are] opting for this fuel type”. Green Car Congress notes that this fuel type was more popular with younger buyers (under 39) than older (ages 40+). Auto News reports that there is uncertainty in the German market for diesel vehicles, largely due to the current debate on banning the fuel in that country. Alternatively, a separate report from ACEA shows that all five major markets showed double-digit increases in the demand for alternative fuel vehicles. Additionally, research showed that more women (than men) were interested in electric vehicles.

TREND: INCREASED RESEARCH & USE OF SOCIAL MEDIA IN POTENTIAL AUTO-BUYING SEARCHES

Since more women are getting licenses and buying cars, and more women (than men) use social media, it only makes sense that social media analytics show increases (globally) of these avenues being used to search for new and used cars to purchase. BrandWatch notes that, in the UK, “38% of consumers consult social media before a car purchase,” and that “by 2020, 40% of new car buyers will be millennials, of which 88% [will] use the internet to research [a potential] car purchase”. With Deloitte reporting that most potential car buyers research their purchase for at least three months before making a decision, that’s a lot of time to spend on finding reviews on social media and via other online avenues.

As noted previously, research from eMarketer (as noted in Driving Sales) shows that women prefer less technical-speak and look more for information “that tells them something about the vehicle they can’t learn from a list of specs”. Since this type of information is most often found in personal stories or reviews, like those found in social media chatter, and less likely to be found on manufacturer or dealer websites, this shows a distinct shift in car-searching behavior.
The report also notes that women show higher engagement when words like “drive, trip, comfortable, [and] handling” are used because of the relatable way the experience of driving a particular vehicle is described. Additionally, women connect with words like “compassion” and “smiles” more frequently indicating they hold the positive connection with dealership personnel as more important than men do. However, the research also shows that women are more afraid than men of going to dealerships because they believe they won’t be treated with the same respect that a man would be treated.

SUMMARY

In Europe, more women than ever before are driving and purchasing vehicles, as well as using social media to research before they buy. Though fewer are taking advantage of the advanced technologies provided in their new vehicles. In light of the changing face of the market, auto manufacturers and dealers are hiring more women and focusing their advertising more specifically on the female demographic.
Part
03
of three
Part
03

Saudi Arabia: Trends in women buying cars

With King Salman's recent signing of a decree that will finally allow Saudi women to drive, car sales in Saudi Arabia are expected to increase. Most Saudi women who plan to drive intend to buy a car, with the likelihood to buy being more pronounced among women belonging to medium- or high-income households. In most cases, the male household head will have the final say on the purchase of the car, but the female household head will have some influence on the decision-making process. To take advantage of the opportunity that the lifting of the driving ban brings, marketers must truly understand the preferences of potential Saudi women drivers, one of which is their preference for small- or medium-sized sedans.

BACKGROUND

Based on a report published by professional services firm PwC Middle East last March, the number of female drivers in Saudi Arabia by 2020 is expected to reach 3 million, which is 20% of the projected 15-million female population. This forecast was made following King Salman bin Abdulaziz Al Saud's monumental signing of a decree last September allowing women to drive. Though women in the country can only start driving on June 24, 2018, they can already apply for driving licenses and learn how to drive. Prior to the signing of the decree, Saudi Arabia had been the only country disallowing women to drive.
As can be seen in the computations below, of the 3 million projected female drivers in 2020, 6.8% are expected to come from Medina, 14.2% from the Eastern Province, 26.7% from the Mecca Province, and 24.3% from Riyadh.
Medina: 204,000 / 3,000,000 = 6.8%
Eastern Province: 427,000 / 3,000,000 = 14.2%
Mecca Province: 801,000 / 3,000,000 = 26.7%
Riyadh: 728,000 / 3,000,000 = 24.3%
Since the number of male drivers is expected to grow to 9.5 million by 2020, it can be estimated that, in that year, there will be around 3 male drivers to 1 female driver.
9.5 million male drivers / 3 million female drivers = 3.167 male drivers to 1 female driver
At present, 47% of women in Saudi Arabia rely on family members to drive them places, 38% use ride-hailing apps, 31% use public transportation, and 21% have a hired household driver. This is according to a report published by market research firm Ipsos last December.

Based on a poll conducted by Kantar TNS last September, when asked about their motivation for driving, 45% of Saudi women who intend to drive said they would like to drive to work, while 39% said they would like to drop off their children.

SAUDI WOMEN FROM HIGH-INCOME OR MEDIUM-INCOME HOUSEHOLDS LIKELY TO BUY A CAR

According to Ipsos's study, 51% of women aged 16-64 in Saudi Arabia are likely to purchase a car after the driving ban is lifted, with the likelihood being higher among women residing in the Central Region (56%), women belonging to high-income (61%) or medium-income (66%) households, and women who have a hired household driver (66%) or who use either public transportation (56%) or ride-hailing apps (61%).

Polling firm YouGov, on the other hand, revealed in its report last October that 65% of Saudi women intend to drive after the ban is lifted, and of those who plan to drive, 85% say they will purchase a car. Also, of the Saudi women polled by Kantar TNS, 38% intend to purchase a car this year, while 60% intend to purchase a car within the next three years.
Analyst David Oakley at LMC Automotive expects a 15% to 20% increase in Saudi Arabia's car sales because of the lifting of the driving ban.

SAUDI WOMEN TO EXERT SOME INFLUENCE ON THE CAR PURCHASE DECISION-MAKING PROCESS

Based on Ipsos's report, though the car purchase decision maker will still be the male household head in most households in Saudi Arabia, women will have a say in the decision-making process in some households. In 42% of households in the country, it is the male household head who will decide on the car purchase, but in 28% of the households, though the male household head will still be the final decision maker, the female household head will have some influence on the decision-making process.

Male and female household heads will have an equal say in the car purchase decision-making process in 26% of the households. In 2% of the households, the female head, with some inputs from the male head, will have the final say, and in another 2% of the households, the female head will be the primary decision maker when it comes to the purchase of the car.

SAUDI WOMEN INCLINED TO BUY SMALLER VEHICLES

As revealed by YouGov's report, Saudi women prefer smaller vehicles. Analyst Rebecca Lindland at Cox Automotive says she does not find this surprising at all. She explains that "small to medium sedans are easier to maneuver, park, and manage overall, and reflect preferences seen in other parts of the world." She adds, "I can also imagine women are thinking of zipping around in traffic and expressing their personalities. That can be done better in a fun, sporty sedan than in an SUV."
According to YouGov, 44% of Saudi women saying they will buy a car plan to spend no more than SAR 40,000 or USD 10,666. The same percentage of women prefer small- or medium-sized sedans. Saudi women also seem to prefer black or pearl white colors and the Toyota, BMW, and Jeep brands, based on YouGov's study.
Based on Ipsos's study, on the other hand, women in Saudi Arabia appear to favor Asian car brands, as six out of the top 10 car brands they prefer are Asian. Toyota (30%), Mercedes (22%), BMW (22%), Hyundai (20%), and Kia (13%) are the five brands that women in the country find most appealing. In Kantar TNS's report, the brands that emerged as most preferred by Saudi women were Toyota, Hyundai, Ford, Nissan, and BMW.

CAR MAKERS BEGIN TO WOO SAUDI WOMEN

Immediately after the signing of the decree, car makers lost no time in releasing ads to win over Saudi women. For example, both Ford and Volkswagen launched ads on Twitter in response to the news. The ads contained the words "Welcome to the driver's seat" and "My turn," respectively. Other car brands that saluted the lifting of the ban include Nissan and BMW.

According to Neal Henriques, Kantar's automotive director in the region, "marketers who want to be ahead of the game need to gain a deep understanding of the needs and drivers that will affect female purchase decisions and tailor their offerings accordingly to capitalise on the new oppor­tunity."

CONCLUSION

The lifting of the ban against women driving in Saudi Arabia is expected to drive car sales growth in the country. Saudi women who intend to drive after the ban is lifted are likely to purchase a car, with the odds of purchase being higher among women belonging to medium- or high-income households. While the male household head, in general, will be the primary decision maker when it comes to the purchase of the car, there is evidence that the female household head will have some say in the decision-making process. For car marketers to make the most of the favorable circumstances brought about by the lifting of the driving ban, they must have a keen understanding of what prospective Saudi women drivers prefer, including the type of car they desire to drive, which was found to be small- or medium-sized sedans.
Sources
Sources

From Part 02