14
Sep

For Most Americans, Being “Mobile” Still Requires a Personal Vehicle

For Americans, Being "Moble" Still Requires a Personal VehicleBy: Bryan Krulikowski, Senior Vice President

How do you get from point A to point B? Given that 4-in-10 consumers believe their primary mode of transportation will be different five years from now than today, the answer to this is going to become increasingly complex.

The goal of the Morpace MOVETM Study that was recently fielded and is now available as a syndicated study is to help answer this question. We surveyed more than 3,000 consumers across eight U.S. metropolitan markets and uncovered some interesting consumer insights about the role of transportation and mobility in this new “Sharing Economy.”

Consider:

  • Overall, more than two-thirds of respondents would have their ability to get around strongly impacted by not owning their own personal vehicle.
  • Although ride-sharing services are currently being used at a greater rate than car-sharing services, they are reserved for “occasional” use and not relied on as every day transportation.
  • Despite lower levels of vehicle ownership, Urbanites have a stronger emotional attachment to their vehicle than Suburbanites—even going so far as to give their vehicle a name.
  • Finally, fewer than one-third of respondents feel that alternative mobility solutions are practical for them. After all, consumers do not see any other option as convenient as owning a primary vehicle in the U.S.

This shouldn’t come as a major surprise. For decades, vehicles have represented freedom for many Americans. The national highway system has made it feasible to get from state to state, where driving long distances for work or play is more common than in other parts of the world.

Among the many findings in this study is the idea that the majority of consumers clearly feel that having their own vehicle is necessary. They may not use it every day, as other results from the Morpace MOVETM Study show us, but when they need their vehicle, THEY WANT IT.

The study also gives us ideas for how and when personal vehicles are used compared to other forms of transportation. Public transit, particularly in urban areas, does (and will continue to) play a role, perhaps based most on convenience and cost. One-half of respondents have access to public transportation within one mile of their residence. Still, public transportation comprises just part of the mobility puzzle for Americans today.

Morpace MOVETM found that eBike, shared bikes, and car-sharing modes show the greatest potential increase in spend in the next one to three years. But there are times that Americans want to get where they want, when they need to get there. So even for those living in some of the country’s most densely populated communities, nearly all respondents use their own vehicle at least a couple times per month. And three-quarters of current vehicle owners are planning to buy or lease a new vehicle in the next five years.

We may now be part of the “alternative mobility” movement in the U.S. Yet, the value and importance of a personal vehicle remains high for Americans because of that sense of freedom it provides – no matter where you live in this country.

Other findings and insights are available through our Morpace MOVETM Study and you can learn more by clicking here.

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19
May

Oh The Places You’ll Go With Virtual Reality!

Oh the places you'll go with virtual reality!By: Cory Kinne, Research Analyst

You don’t have to be a tech nerd to know that Virtual Reality is cool. It just is. There’s a reason it is always cropping up in fiction—from early sightings in Ray Bradbury’s Illustrated Man, to the smash-hit Matrix trilogy and beyond. The idea of transporting ourselves into a simulated world is intoxicating.

Excitement over Virtual Reality (VR) reaches a fever pitch in the realm of video games. Allowing players to visualize themselves in the worlds they are exploring opens new doors for immersive storytelling. Possibly no other industry is positioned to gain as much from advancements in VR technology as the gaming industry, but that’s not to say it doesn’t have utility elsewhere.

After spending an evening playing with my new Google Cardboard headset, I stumbled upon a question: How might VR be useful in Market Research?

Thousands of dollars are spent on product evaluation clinics, especially in the automotive industry; finding an appropriate sized venue and arranging the delivery of vehicles carries a hefty price tag. What if a clinic could be conducted for the cost of shipping a box of VR headsets and the booking of a hotel conference room?

Obviously, examining a 360 degree rendering of a vehicle will never replace the richness of the traditional, more tactile in-person experience. But is there value to be gained from the agility and simplicity of VR? For example, could insights be uncovered earlier in the design process? Could VR technology minimize the likelihood of unforeseen flaws making their way to the finished product?

Of course, we shouldn’t limit our thinking to the automotive industry—there are other areas where this technology could be useful. It is possible VR will open doors to new areas of Market Research, areas that are currently unexplored or, at the very least, underrepresented.

Imagine working with a hotel chain during the construction of a new property—using a VR headset, respondents may be able to explore a digital mockup of proposed room layouts and designs. With the exception of bed comfort, nearly everything could be evaluated! Feedback on room size, color schemes, furniture design, space utilization and even the artwork on the wall could help ensure the satisfaction of future guests.

The history of VR is filled with bumps and bruises, but with an unprecedented number of products entering the market it appears that virtual reality is here to stay. Though the technology is clearly in its infancy, it may be prudent to speculate about its future utility—further progress in availability, usability, and realism has the potential to revolutionize how we conduct our research.

Who knows the places we’ll be able to go…

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22
Apr

The Connected Car and Consumer Privacy

The Connected Car and Consumer PrivacyBy: Andrew Fixler, Senior Project Director

On March 21st during the keynote address of the Apple Event, CEO Tim Cook reaffirmed the company’s commitment to privacy. Early in his speech he addressed Apple customers directly, saying, “We believe strongly that we have a responsibility to help you protect your data and protect your privacy.”

Leaving the legal analysis to others, consumer satisfaction is more in our line of work as researchers. In our studies relating to the appeal of new features for vehicle makes and models that will be available in the future, consumer feedback demonstrates a clear demand to enhance connectivity. If phones are our new personal assistants and keepers of our secrets, automobiles are increasingly becoming our mobile offices and logistics coordinators.

Current telematics tools with direct relevance to the automotive industry include Apple CarPlay and Android Auto. However, to further increase safety and convenience, automotive manufacturers and suppliers are now preparing for a future where all vehicles are connected to each other, along with the infrastructure that surrounds them. Privacy becomes even more complex if future users feel they should control the information that connects to vehicles from car sharing services like ZipCar or Uber.

Knowing that connected cars are here to stay, how should automakers deal with their customers’ need for in-vehicle security, privacy, and encryption? As of now, automakers are actively seeking ways to keep vehicle software safe from hacking. Developing a comprehensive privacy policy may be the next logical step.

Recent news of the collegial agreement between 20 automakers, the National Highway Traffic Safety Administration, and the Insurance Institute for Highway Safety to make autonomous emergency braking standard by 2022 proves that creating industry guidelines for new technology is possible. This process may be a model for the development of best practices for privacy and connectivity in automobiles, aligning the interests of all stakeholders.

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29
Jan

How Will Current Economic Conditions and Manufacturers Influence Millennial Car Buyers?

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By: Dave Emig, Research Director; Anthony Crechiolo, Market Research Intern

The average price of gasoline in the U.S. has continued to fall the past two years. This past year in particular, the average price of gasoline has fallen from $3.36 per gallon to just $2.42. That’s just over a 38% drop in one year. With many analysts indicating gasoline prices are to remain low into 2017, many wonder what kind of effect this will have on future vehicle sales in the U.S. The answer may lie in how 2015 evolved.

2015 was a record year for automotive sales, coming in at 17.5 million vehicles sold, a 5.7% increase from 2014. Digging deeper, we actually see a drop of over 2% in car sales from 2014 to 2015, while sales of large vehicles were up over 23%. Only looking at these numbers, it seems that Americans have a positive outlook towards the future and are putting their savings at the pump towards a bigger vehicle. This statement may be correct for Americans as a whole, but does it hold true for the next generation of car buyers, Millennials, who are just now entering into the car buying market?

In order to answer this question, I think it is important to first look at how buying a car for Millennials is different than previous generations.

Buying a car used to be a rite of passage to freedom, a way to connect with friends and escape from the parents’ sphere of influence. A car used to give you access to find and define yourself as a young adult. Because of how technology has allowed Millennials to be connected to everything at all times, they tend to break away from their parents’ sphere of influence at a much younger age. However, unlike previous generations, Millennials are entering adulthood at a much later age. Buying their first car still represents this next step into adulthood, but the difference is that this generation has already developed their individual identities before venturing out on their own.

Most Millennials are not entering adulthood until they have completed their secondary education and have found an entry-level job. At that point, they are moving out of the house, figuring out their student loan payments, budgeting daily expenses, putting money away for retirement, and to top it off, looking for a new car. Most entry-level jobs do not provide the income to spend a lavish amount on a vehicle, so Millennials are often restricted to the small or compact car segments because of the limited amount of disposable income they have available.

However, Millennials who are looking to purchase a vehicle have two macro circumstances that make right now the opportune time to purchase a car: low gas prices and low interest rates. There is also the idea, stated earlier, that older consumers’ demand may be shifting away from cars to larger vehicles. This change in demand would keep mid and full size sedan prices low in the short term, but Millennials will likely need convincing to move up from their compact and small car segments.

It seems that Millennials don’t put the same emotion or value on their first car as previous generations have because it doesn’t give them the same type of freedom, as they are already aware of their unique identity. A vehicle to them is more of a machine that serves a functional need – getting them from point A to point B.

But with cars having more connective technology than ever before, will automotive manufacturers use their advertising prowess to convince these first-time consumers that cars can not only keep you connected, but have space for their friends to tag along, too?

Currently, there are hardly any advertisements targeting this group of first time buyers. You see it over and over again, commercials for a mid to full size sedan that emphasize re-kindling that childhood passion. If the idea that the older consumer is shifting from purchasing cars to a larger vehicle is true, it might be time for automotive manufacturers to increase advertising towards the next generation for these types of vehicles. If we see a shift in advertising affordable mid to full size sedans to first time buyers, the automotive industry could continue to boom.

As a result of the recent recession, Millennials feel an increased emphasis on not overextending themselves financially. As you move further along in life and become more financially secure, then you can push your financial boundaries. This trend can be noticed with most Americans; as they move up in their career, they also move up in vehicle class. If automotive manufacturers realize this and are able to persuade these first-time buyers into the purchase of a larger vehicle, they will make more money over time, since this type of buyer moves up the career path more quickly because of their higher starting point.

Will automotive manufacturers be able to persuade Millennials to spend the extra disposable income they have available on upgrading their first car purchase? Or will they just accept that first-time car buyers will come in at a lower vehicle segment and spend their extra dollars on other technology that will continue to make their lives more connected? The future of the automotive industry is in the hands of Millennials—the next generation of savvy consumers.

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