Less than half of do-it-yourself consumers report purchasing motor oil on promotion at auto specialty retailers in the United States, according to a recent study conducted by NPD Group. At the same time, promotional activity for motor oil was up in 2016, with 14 percent more in-store circular motor oil advertisements compared to 2015.
The biggest surprise for me was that a lower than expected number of consumers reported purchasing motor oil on promotion, Nathan Shipley, director and automotive industry analyst for NPD Group, told a reporter. It is a heavily promoted category, and I expected this number to be higher.
The findings were based on motor oil promotions listed in circulars of auto specialty retailers throughout the United States.
Shipley noted in a news release that there is a lot of promotional activity around the motor oil category in terms of the frequency, depth, number and type, but as a must-have category this raises the question of how effective these discounts are at generating additional sales. Consumers have shown they are willing to spend on what is necessary to keep their vehicles running at the optimal level, even if it comes at a certain price.
The report found that more than 80 percent of do-it-yourself consumers make a planned motor oil purchase as opposed to buying on impulse, and more than half purchase it to use right away. More than 40 percent of consumers rely on the recommended mileage between oil changes as the key indicator for an oil change, while only two percent reported their purchase being driven by a coupon, promotion or ad or seeing oil in a store.
Once prompted, DIY consumers begin the purchase process with store selection, NPD found, but tend to be retailer-loyal when shopping for motor oil; they are not as likely to switch based on branded promotions, because they prefer to shop in a store they are familiar with.
According to NPD, non-Millennials tend to look first at brand, while Millennials equally prioritize brand, type and price. Millennials are also more likely to purchase oil-changing-related items or unrelated products when in the store for motor oil.
Other consumer insights shared in the report:
- Over half of all consumers are loyal to their oil change method.
- Eighty-two percent of do-it-for-me vehicle owners were aware of the type/formulation used in their most recent oil change.
- Two of the top 10 do-it-yourself retailers considered for most recent motor oil purchases were dot-coms.
- NPD noted that most concerning for the retail side of the oil business is the 30 percent of DIFM customers who have transitioned from a DIY oil purchase to a service provider installation.
- Seventy-six percent of do-it-for-me customers who switched from DIY did so five or more years ago.
- One third of oil change service occasions included a special offer or coupon. More than half of those special offers were for discounts of $10 or less.
Being a necessity, consumers will, no matter what, be in stores to buy motor oil. With that, the opportunity for retailers and manufacturers lies less in promoting this category, and more in capitalizing on the consumer while he is in the store, and driving impulse purchases, Shipley stated.
The study, which he said was conducted for the first time, was titled, The Passenger Car Motor Oil Purchase Journey.