Table of Contents
Issues in the Market
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- Definition
- Abbreviations
Insights and Opportunities
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- Taking lessons from the mobile phone industry
- Focus on families
Market in Brief
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- Market showing signs of slowing
- Current economic woes are a major factor
- A market dominated by the ‘big three’
- High level of advertising to sales investment suggests promotion is important
- Customer interest in recovery service varies with this impacting on their choice of provider
- Slowdown in market may result in reassessment of current company strategies
Fast Forward Trends
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- Trend 1: Stress Society
- What’s it about?
- What’s next?
- Trend 2: Nostalgia
- What’s it about?
- What’s next?
Internal Market Environment
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- Key points
- Number of licence holders continues to rise
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- Figure 1: Number of license holders by age group, 1975-2006
- Growth in multiple car ownership continues…
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- Figure 2: Number of cars owned by individual households, 1985/86-2006
- …as illustrated by the growth in car ownership intensity
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- Figure 3: Number of cars per household and cars per adult aged 17+, 1985/86-2006
- Although credit crunch is set to have an impact on car market
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- Figure 4: Trends in private new car registrations and finance penetration, 2001-07
- Drivers’ ability to undertake roadside repairs is decreasing
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- Figure 5: GB car servicing, by destination, 2002 and 2004
- Cross-selling adds a new layer of competition to the market
Broader Market Environment
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- Key points
- PDI and consumer expenditure expected to stagnate
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- Figure 6: Total PDI and consumer expenditure, 2003-13
- Rising adult population and increasing status may encourage trading up
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- Figure 7: Forecast adult population trends, by socio-economic group, 2003-13
- An ageing population
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- Figure 8: Trends in the age structure of the UK population, by gender, 2003-13
- Rising number of one-person households brings opportunities
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- Figure 9: UK household sizes, 2003-13
- Growing use of the internet may signal a change in the way consumers buy cover
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- Figure 10: UK broadband penetration, 2004-08
Competitive Context
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- Key points
- Will rising cost of motoring impact on expenditure?
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- Figure 11: Consumer expenditure on car purchasing, servicing and repair and motoring expenses, at current prices, 2003-08
- What about other demands?
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- Figure 12: Consumer expenditure on selected leisure goods and activities, 2002-07
- Drivers are more reliant on others
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- Figure 13: UK retail sale of safety and emergency equipment, 2002-07
Strengths and Weaknesses in the Market
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- Strengths
- Weaknesses
Who’s Innovating?
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- Key points
- Way of dealing with the market
- Cross-selling
- Financial incentives
- Online discounts
- No-claims discount
- Cashback
- Other offers
- Technological improvements
- Additional services
Market Value and Forecast
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- Key points
- Recovery market shows signs of stagnation
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- Figure 14: Forecast of the UK vehicle recovery market, by value, at current prices, 2003-13
- Figure 15: Forecast of the UK vehicle recovery market, by value, at constant 2008 prices, 2003-13
- Challenging times since 2005
- Stagnation to continue till 2010
- What else is contributing to the problems ahead?
- Factors used in the forecast
Market Segmentation
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- Key points
- Membership market performs much stronger
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- Figure 16: UK market value for motoring organisation membership, by value, 2003-08
- Ad hoc segment stagnates
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- Figure 17: UK market value for ad hoc breakdown services, by value, 2003-08
Market Share
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- Key points
- Direct and indirect operators
- Direct
- Indirect sales
- AA dominates the market
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- Figure 18: Company shares in the vehicle recovery market, by UK membership, 2004-08
- Sluggish growth
Companies and Products
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- AA
- RAC
- Green Flag
- Others
- Britannia Rescue
- Mondial
- Europ Assistance
- GEM Motoring Assist
- Autonational
- NCI Vehicle Rescue
- The independent sector
Brand Elements
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- Brand map
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- Figure 19: Attitudes and usage of vehicle recovery service brands, August 2008
- The AA
- What the brand is trying to achieve
- What the consumer thinks
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- Figure 20: Attitudes towards the AA brand, August 2008
- RAC
- What the brand is trying to achieve
- What the consumer thinks
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- Figure 21: Attitudes towards the RAC brand, August 2008
- Green Flag
- What the brand is trying to achieve
- What the consumer thinks
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- Figure 22: Attitudes towards the Green Flag brand, August 2008
- Brand qualities of vehicle recovery service brands
- AA leads the way, but Saga safety not far behind the big three
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- Figure 23: Personalities of various vehicle recovery service brands, August 2008
- Experience of vehicle recovery service brands
- AA most popular, smaller players lack awareness
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- Figure 24: Consumer usage of various vehicle recovery service brands, August 2008
- Brand intentions for vehicle recovery service brands
- Consideration good, even in the niche
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- Figure 25: Consideration of various vehicle recovery service brands, August 2008
- Brand momentum for vehicle recovery service brands
- No breakdown in momentum…
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- Figure 26: Momentum of various vehicle recovery service brands, August 2008
- Brand satisfaction for vehicle recovery service brands
- Nothing to choose between the big three
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- Figure 27: Satisfaction with various vehicle recovery service brands, August 2008
- Brand commitment to vehicle recovery service brands
- AA leads for loyalty, Green Flag equally strong on affection
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- Figure 28: Commitment to various vehicle recovery service brands, August 2008
- Round up
Brand Communication and Promotion
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- Key points
- Advertising expenditure fluctuates
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- Figure 29: UK main monitored media advertising expenditure on vehicle breakdown and recovery services*, 2003-08
- Television and direct mail are increasingly favoured by advertisers
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- Figure 30: Vehicle recovery advertisers spend by media type, 2003-07 (ranked by last full year, 2007)
- The RAC and AA dominate promotional spend
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- Figure 31: Top ten car recovery advertising spenders, 2004-07 (ranked by last full year, 2007)
- The AA retains first place...
- ...with the RAC a strong second
- Green Flag looks to challenge for third place...
- ...as other companies continue to reduce spend
The Consumer – Vehicle Recovery Services Used
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- Key points
- AA and RAC dominate the market
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- Figure 32: Usage of vehicle recovery services, September 2008
The Consumer – How Do Consumers Buy Vehicle Breakdown Services?
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- Key points
- Personal annual subscriptions prove most popular
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- Figure 33: How consumers pay for vehicle recovery, September 2008
The Consumer: Attitudes towards Vehicle Recovery Services
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- Key points
- A market of users and non-users
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- Figure 34: Attitudes towards vehicle recovery services, September 2008
Vehicle Recovery Target Groups
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- Key points
- Those viewed as a prime target account half of the market
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- Figure 35: Vehicle recovery groups as a percentage of all those who have breakdown cover, September 2008
- Group 1: Prime Targets
- Group 2: Low Need
- Group 3: Nonchalant
- Prime Targets opt for biggest name in the market
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- Figure 36: Vehicle recovery groups as a percentage of users of vehicle breakdown services, September 2008
Appendix – Vehicle Recovery Services Used
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- Figure 37: Usage of vehicle recovery services, by detailed demographics, September 2008
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Appendix – How Consumers Pay for Vehicle Recovery
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- Figure 38: How consumers pay for vehicle recovery services, by detailed demographics, September 2008
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Appendix: Attitudes Towards Vehicle Recovery Services
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- Figure 39: Attitudes towards vehicle recovery services, by detailed demographics, September 2008
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Appendix: Vehicle Recovery Target Groups
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- Figure 40: Cluster formation, by detailed demographics, September 2008
- Figure 41: Cluster formation, by attitudes towards vehicle recovery services, September 2008
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- Figure 42: Cluster formation, by use of vehicle recovery services, September 2008
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