SILVERADO MAKING NOISE IN THE FULL-SIZE PICKUP SEGMENT

By: Jackie O'Dowd

January 18, 2007

Chevrolet launched the new Silverado 1500 pickup in the fall of 2006. Success of this new truck is critical to maintaining Chevrolet’s position in the increasingly competitive full-size pickup segment. Compete assessed the number of Silverado 1500 shoppers generated during the launch of the new truck and its impact within the full-size pickup segment.

In four of the five months leading up to the launch of the new 2007 model, Silverado 1500 had fewer than 80,000 unique shoppers. Since its October launch, however, shopper counts have exceeded 100,000 in each month and in December reached a record high 124,700.

Share of Segment Interest (the share of all full-size pickup shoppers that shopped Silverado 1500) has also reached record highs indicating its performance relative to the segment overall. Silverado 1500’s SSI was at a near period-low of 20% in September just prior to the launch. Since then, shopper counts have outperformed the segment as evidenced by increasing Share of Segment Interest. In December, SSI improved to a best-ever and segment leading 27%.

To better understand the Silverado launch, additional insights could be gained through an analysis of competitive pickup shoppers and the extent to which they have increased cross-shopping of the new Silverado. This type of analysis would help Chevrolet understand the potential of the new Silverado to conquest competitive rivals and help direct communications to the most appropriate prospects.

A REBOUND FOR LARGE SUV’S?

Large SUV’s were hit especially hard as gas prices soared to record highs in the summer of 2006. Sales declined as buyers opted for more fuel efficient vehicles. Compete assessed the impact on large SUV shopper counts as gas prices have risen and fallen over the past year.

When gas prices first spiked in April of 2006, shopper counts for large SUV’s, both luxury and non-luxury, began their decline. (April prices increased 13% month-over-month, the largest m-o-m change in all of 2006). Shopper counts continued to fall in the summer, declining to period-lows in August, one month after gas prices peaked at an average of more than $3.00 per gallon. Large SUV shopper counts began to rebound in September and October, coinciding with the two largest m-o-m declines in gas prices. As prices stabilized in Q4, shopper counts stabilized as well.

Will large SUV shopper counts continue to rebound if gas prices remain stable in Q1? While many factors impact shopper behavior, the cyclical nature of gas prices over the past two years have increased the sensitivity of new vehicle shoppers. Understanding shifts in shopping patterns is critical to recognizing and adapting to changing market conditions.