As the US automotive industry continues to maintain its fast pace, it is time to decode the distinct personas of different car buyers with our guide to automotive market segmentation. It will assist car dealers, marketers, and manufacturers in boosting sales and catering more professionally to their customers.
By 2029, the overall market is expected to cross $37.8 million, resulting in a CAGR growth of 13.17% throughout the current decade. If you want to make the most out of this situation, your prime focus must be the updated automotive market segmentation. For specifics, keep reading.
What is Automotive Market Segmentation?
Market segmentation for automotive industry or automotive market segmentation sums up segregating potential customers into easily identifiable groups based on common wants and needs. It is an effective technique car-selling companies use to channel their marketing efforts masterfully.
Your car dealership can acquire 10,000 leads in the database. Auto market segmentation enables the experts to choose specific clients and put them under different categories that satisfy conditions.
Often, dealers analyze prospective buyers’ demographics like age, location, marital status, and gender to form a potential automotive market segmentation. These activities help reflect the precise life cycles of different customers in the selling process.
Accordingly, your designated salespersons can pay more attention to a specific group of active customers and devise key strategies to regain old clients. Their efforts play a vital role in maintaining a stable target market throughout the year for your business.
Why is it Important to Understand the Types of Automotive Market Segmentation?
Researching and defining clear and concise segments in the automotive industry requires many resources. However, successful attempts can ensure the long-term profitability of a dealership.
Here’s why marking different auto industry segments is necessary:
1. Allows Optimal Usage of Resources
With the right market segmentation campaigns, the dealership management can target specific groups of customers. It directly helps reduce customer conversion costs compared to the traditional reach approach.
2. Fosters Chances for Loyalty Towards Dealership
Accurate automotive industry market segmentation encourages salespersons to focus on building strong connections with their customers. As a result, they can implement personalized marketing strategies to resonate better with a client through the power of AI in automobile industry.
Moreover, the different customer segments automotive industry help the companies to determine whether they are approaching the right customer or pitching them the right product.
3. Facilitates Targeted Digital Advertising
Automotive segmentation forms the very foundation of targeted advertising for car dealerships. With Spyne’s powerful virtual car studio, you can immediately capture the attention of car enthusiasts looking for specific vehicles!
Further, through social media, you can invest in automotive marketing plans to cater to the needs of different buyers in different locations, age groups, and habits.
Types of Segments in Automotive Industry
One cannot ignore the following customer segments when discussing automotive industry segmentation or market segmentation automotive industry.
Segment 1: Performance Car Enthusiasts
This category comprises individuals who emphasize a car’s performance capabilities over other factors when purchasing.
- Values and Priorities: These motorists look for impressive acceleration, superior power output, and responsive handling. For them, a car is not just a mode of commute but a value addition to their lifestyle.
- Vehicle Preferences: Typically, those identified under this market segmentation of the automotive industry are fascinated by sports car models, high-performance sedans, and similar other models.
Their preferred car models have powerful engines, cutting-edge suspension systems, and aerodynamic designs to maximize the driving thrill. Some iconic models under this segment are the Nissan Z, Jaguar F-Type, BMW M4, and Chevrolet Corvette.
- Market Share: According to automotive industry trends, the market size of sports cars is expected to show a yearly growth of 1.32% between 2025 and 2029. Manufacturers have already recognized this opportunity; thus, it is high time for dealers to capitalize on this situation.
Segment 2: Family-Oriented Car Buyers
This points to an evergreen automotive industry segmentation where customers consider vehicle safety, spaciousness, and practicality before buying.
- Values and Priorities: Family car purchasers put the safety and security of their family members above all. Also, they look for models that can offer ample space for both the vehicle occupants and cargo.
- Vehicle Preferences: Generally, family-oriented consumers go for SUVs, crossovers, and minivans. These vehicles are known for their high-tech safety features such as collision warning, advanced driver-assistance systems (ADAS), blind-spot monitoring, etc.
The Subaru Crosstrek, Kia Telluride, and Hyundai Tucson are common
favorites among family car seekers.
- Market Share: Family-oriented consumers currently cover a significant part of other segments in the automotive aftersales industry.
World-renowned manufacturers are already aware of this; thus, you can see the incorporation of features like enhanced child safety locks, versatile seating configurations, surplus storage compartments, and much more.
Segment 3: Economical Buyers
Within the broader automotive market segmentation, economical buyers are the price-sensitive people. These people consider their cars mindfully after comparing fuel efficiency, upfront costs, and long-term operational expenses.
- Values and Priorities: Low-maintenance cars are a reasonable investment for these buyers. They seek four-wheelers that can be used extensively in the long run without worrying about frequent repair needs.
- Vehicle Preferences: Economic car lovers usually buy a hatchback, compact car, or a small SUV. You can rely on these car types, too, if you prioritize easy maneuverability in traffic, effortless parking, and budget-friendly maintenance.
Popular manufacturers like Honda, Toyota, and Hyundai produce vehicles under this segment.
- Market Share: Quite recently, Statista revealed that Toyota controls 14.46% of the US light vehicle market according to the user car buyer demographics and statistics.
Such a significant market could be captured due to the presence of many buyers who purchased cars while considering their financial limitations.
Segment 4: Environment Conscious Drivers
These vehicle owners are characterized by their seriousness towards sustainable practices. They will always give an upper hand to vehicles that produce low emissions and cause reduced carbon footprints.
- Values and Priorities: Beyond the vehicle usage lifecycle, these consumers prioritize responsible and sustainable manufacturing practices. They are committed to contributing towards a greener future of used car market.
- Vehicle Preferences: Eco-friendly drivers love to drive electric vehicles and hybrid cars. Among these, the first solely runs on a battery while the latter requires a combination of battery and internal combustion engine.
Some noteworthy mentions under the EV segment are the Toyota Prius, Tesla Model 3, and Nissan Leaf.
- Market Share: Between 2025 and 2029, the EV industry is anticipated to show an annual growth rate of 10.54%. This massive change is all because electric vehicles are becoming increasingly prevalent worldwide.
Additionally, with advanced battery technologies, electric vehicles will be able to offer far greater driving ranges in the near future. This will result in even faster adoption moving forward.
Segment 5: Off-Road Fanatics
Finally, this is an adventurous automotive market segmentation that includes a highly selective group of car enthusiasts. These people seek cars that extend off-road capabilities.
- Values and Priorities: People availing of off-road cars look for high-ground clearance, robust structure, and specialized safety features. All these traits enable an off-road vehicle to conquer rugged terrains easily.
- Vehicle Preferences: Off-road car seekers emphasize the durability, versatility, and performance of vehicles, especially when driven in demanding road conditions. A few iconic models under this category include Toyota 4Runner, Jeep Wrangler, and Ford F-150 Raptor.
- Market Share: The influence of off-road car lovers on the automotive market is immense. Their passion for exploring new heights drives automobile manufacturers to enhance technologies that cater to car buyers’ needs consistently.
To capture the attention of different customer segments in the automotive industry, you can consider car interior videography and target them toward the intended market segments. For help, you can count on Spyne for automotive social media marketing or automotive digital marketing.
How Understanding Automotive Market Segmentation Will Increase Your Dealership’s Revenue?
Understanding automotive market segmentation can help your dealership increase revenue by helping you make targeted automotive brand marketing campaigns. When you know the different segments, you can understand the preferences and needs of the consumers and thus devise marketing strategies and messages accordingly.
Here’s how market segmentation can help dealerships increase revenue:
1. Know About the Long-term Customers
By using Spyne’s AI-powered marketing tools, dealerships can identify customers who are more long-term and high-value.
2. Create More Personalized Campaigns
Dealerships can invest in more personalized campaigns for high-value customers, which include targeted social media ads and customized email marketing.
3. Improve Customer Satisfaction
By providing relevant products like Spyne’s inventory management and website builder products, automotive dealerships can improve customer satisfaction and put more value into their sales.
4. Build Relationships
Dealerships can increase customer loyalty by building strong and long-term relationships with them.
5. Use the Marketing Budget Better
When the dealerships know about these segments, they will know which ones respond well and which do not. This will help them put resources into areas that need it the most.
How Spyne Can Help?
In the upcoming years, Spyne has anticipated that there will be a growing demand for used cars among the different customer segments in the automotive marketing trends. In this regard, Spyne has built a suite of AI-powered solutions to enable automotive OEM and used car dealerships to stay ahead of their game and reap maximum revenue.
Here’s how Spyne can help in navigating the different segments of the used car market and thereby drive more sales:
1. Inventory Management
Spyne’s car dealer inventory management software helps you create consistent listings, be it across third-party marketplaces, social media channels, or your website. They organize your vehicle display pages, add essential details about your used vehicles within seconds, and merchandise your lot online, helping the automotive market’s various segments make decisions easily while buying vehicles.
2. Retargeting Interested Customers
Spyne’s CRM software can gather impressions from various profiles across multiple social media platforms. These analytical capabilities will help attract like-minded market segments who previously enquired about some cars.
3. Building a Highly Interactive Website
Our website builder will be your best companion and help you manage a customer-friendly website. Also, the features of this type of website will be extremely responsive and mobile, which will keep your dealership ahead of other competitors. If you want to know more about automotive dealership benefits, Spyne has your back.
4. Creating Customized Email Content
We can help brands run personalized email campaigns through automotive brand marketing or automotive digital marketing. Also, dealers can automatically update their subscriber list through us and send custom updates on specific dates, helping the various market segments.
Conclusion
Before strategizing any effective promotional campaign, you should do proper automotive market segmentation. It guides the different departments involved in enhancing the appeal of cars even further to the right audience. This in turn, reduces costs and boosts the chances of sales.
  
