Consumers Go High, Low on Motor Oils


With fewer consumers buying new vehicles and more keeping their vehicles on the road longer, motor oil marketers can best succeed by differentiating their products – either by low price or value-added attributes, an NPD analyst said, discussing results of an annual consumer survey of vehicle owners.

If Im not clearly differentiated around either of those two, I think that becomes much less compelling to the consumer, David Portalatin, industry analyst for NPDs Houston-based automotive unit, told Lube Report. I think as a motor oil marketer, you want to avoid the middle ground.

NPDs recently released 2010 Consumer Outlook Study provides a first glimpse into consumer attitudes and anticipated behaviors for aftermarket spending in the coming year. It is based on a survey of about 1,500 people, conducted among the companys online consumer panel, which is a nationally representative sample of vehicle owners.

The percentage of consumers changing oil more often reached 18 percent in 2009, up from 12 percent last year. Meanwhile, respondents using a premium motor oil rose from 8 percent in 2008 to 11 percent this year. The percentage of consumers who said they changed their motor oil less frequently rose just slightly, from 6 percent last year to 7 percent this year.

We see consumers opting for the low price point certainly, but many consumers are looking at it and saying if Im going to invest in this car, if Im going to make this car last as long as possible, then it makes sense for me to put the best quality materials into it, Portalatin explained. So we see full synthetic motor oil continuing to do very well, and as we see in the survey, theres an increase in percentage of consumers who say, yes, Im going to shift to a more premium oil in my vehicle over the coming year.

When NPD asked consumers about vehicle repair plans for 2010, nearly one out of three (30 percent) consumers indicated they plan to do more vehicle maintenance in 2010. Out of the 70 percent not doing more, 64 percent plan to do the same things to maintain their vehicle. The survey found that 94 percent of consumers plan to do the same amount of maintenance or more next year.

The thing that maybe is a little bit surprising is that for the last year or more, weve seen automotive maintenance be an area where consumers were willing to cut back, to save money, in response to the economy, Portalatin noted. Motor oil volume had been in decline.

NPD believes consumers looked back on 2008 as a year of deferral and cutback. Whats emerged is 2009 into 2010 is going to be all about consumers realizing they cannot defer any longer, and that the best and most economical thing they can do is take good care of their existing car, keep it performing efficiently and keep it on the road as long as possible, the analyst added. Were starting to see evidence of consumers doing that, and were starting to see even motor oil volume begin to pick up. Its really interesting that many consumers are even opting for the more premium offerings.

Portalatin said both ends of the spectrum – lower price point products, and premium priced products – appear to be doing well. He noted that because many consumers are still feeling financially squeezed, and unemployment is still very high, many will opt for lower price point offerings. Portalatin suggested that means that private label store brand motor oils, for example, will continue to grow in volume and do well.

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