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Car buyers start on Internet - will forklift buyers follow the trend?

Local Feature Article

- 23 Mar 2005 ( #201 )

3 min read

A recent study shows more car buyers are starting their enquiry on the Internet. Forkliftaction.com sent the story below to the directors of MHEDA and asked if they thought there would be a similar trend for forklifts in the coming years.

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The executive summary of the Borrell Associates study reports most of the estimated 61 million consumers who bought a new or used car in 2004 began their search on the Internet.

The study projects that online automotive advertising will grow to about USD2 billion by 2006, accounting for 6.4 per cent of the total spent on auto sales advertising.

Overall automotive advertising grew at a rate of about 2 per cent last year while online automotive advertising increased 51.5 per cent to USD1.2 billion.

Traditional ad formats like print ads and broadcast TV commercials lost market share while the Internet continued its steady gain.

Automotive dealers made the largest spending changes last year. They nearly doubled their spending on Internet products while slowing down their spending on newspapers, broadcast TV and radio.

Manufacturers boosted online spending by 38.8 per cent, cutting back on auto magazines, broadcast TV and newspapers.

Dealer associations meanwhile increased online spending by 20.2 per cent and made major cuts in auto magazines and radio.

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Here is what they said:

"Without a doubt you will see growth in web-based marketing and sales of forklifts. While the auto market is driven by consumers and the overall US volume is much smaller, 180,000 trucks vs. 16,000,000 cars, I think you will see businesses and folks doing business, expecting information over the web as the "defacto" standard. I can tell you this is how we have shifted our spending. The other related trend is the use of e-mail as a contact tool and as a means to deliver information to customers."
- David Griffith, Modern Group Ltd president (MHEDA president)

"I am sure we (forklift dealers) are already seeing this in our industry. Our company is currently receiving local leads, from a search engine, that identifies who is looking for a forklift on the internet. This location oriented 'pay for leads' service is working very well for us yet it only identifies the used truck buyer. We are not seeing the large or even one-truck orders of new trucks going through the internet at the dealer level. The major factors in the dealer's arsenal are service and relationship. Neither can be provided through the internet. Like the auto industry, we are surviving on parts and service. Internet buying. Is it coming? Sure. Is it bad? The jury is still out."
- Loren Swakow, Scott Lift Truck Corp vice president (MHEDA immediate past president)

"We are seeing customers using our web site to obtain initial information prior to making a phone inquiry. Many want to talk only after they have acquired an initial understanding of the products and capabilities of the dealership. Over time, it is natural to expect that distributors and manufacturers will build more direct purchase functions into their sites, particularly after upgrading their business system software with front end internet commerce capability. More than once I have heard this question posed to manufacturers:
'What is fundamentally different about selecting a lift truck online compared with selecting a Dell computer online?'
In many cases, I think...not much,"
- Fred Oram, Oram Material Handling Systems Inc president (MHEDA director)

"I think forklift buyers are more likely to use the internet to help get started, perhaps comparing trucks. I do not believe the internet in the near future will assist in comparing engineered systems. It is hard to compare conveyor components. The end user may visit manufacturers/integrators websites to compare the companies."
- Chuck Frank, Advanced Handling Systems Inc president (MHEDA director)