Nearly Half of Americans Unlikely to Buy from Automakers Considering Bankruptcy
New Ad-ology Study Reveals Advertising’s Impact in the Current Economy Twenty-one percent of consumers say they definitely would not consider buying a car from an automaker considering bankruptcy, according to a new survey. Another 28.6% said they probably would not consider buying a car from a struggling manufacturer. The Ad-ology Research survey studied advertising’s impact in the current economy. Fifty percent of respondents think an auto dealership must be struggling if they stop or cut back on advertising, and 19% assume the dealership will be less willing to deal. “The effect that a reduction of advertising can have on a business is profound,” said C. Lee Smith, president and CEO of Ad-ology Research. “It’s not just out of sight, out of mind. It’s worse. Whether it's GM, Chrysler or individual dealerships, the auto industry must stay top-of-mind to rebuild consumer confidence.” Smith said.
Another hurdle for automakers is that 46% of consumers say they view a company’s products or services much less or somewhat less favorably after an announcement of a large number of layoffs. Other key findings from the survey:
- Of consumers who would consider buying a car from a struggling automaker “only if they got a great deal,” 38.6% said a deeply discounted price and 38.8% said a discounted/free extended warranty would make a purchase more likely
- 80% of consumers surveyed are as willing or even more willing to pay more for “green” products than they were a year ago
- 33% think a “focus on value” is the most effective tone for advertising in the current economic climate
- TV, newspaper, direct mail and Internet top local media from which consumers saw/heard an ad within the last 30 days that led them to take action
Ad-ology Research surveyed an online consumer panel of 1,225 adults in a manner that is 98% representative of the adult population of the United States from April 24–29, 2009. The margin of error for this survey is +/- 2.2 percentage points. Editor's Note: Ad-ology Research does not maintain any U.S. automaker or dealership group as a client or stockholder and has not received any financial contributions from third parties in exchange for conducting this study. The report, Advertising’s Impact in a Soft Economy, will be released May 12, 2009 through Ad-ology.net.