Carvana is a used car dealership that, like all used car dealers, buys vehicles from consumers and resells them for a profit. What sets Carvana apart from Carmax and similar businesses is that it’s one of the few wholly online auto retailers that promises a contactless delivery process and non-negotiable prices.
As of this writing, only 3% of U.S. adults report having used Carvana to buy a car, while 5% report not having used it, but intending to do so sometime in the future. The data on those who sell through Carvana is roughly the same. Only 2% of Americans report having used Carvana to sell a car, while 4% still plan to use it.
Less than 1% of U.S. adults earning $50K or less per year have ever bought a car through Carvana. This is significantly fewer people than in the higher-income brackets, with 5% of those earning more than $100K per year having bought through Carvana. But while those earning less than $50K are less likely to have bought a car through Carvana, they intend to do so at nearly the same rate as other income groups.
Why Carvana is more popular among people making more money could be explained by the fact that 21% of those earning $50K or less have never shopped for a new car, compared to only 7% of those earning more than $100K who haven’t.
Twenty-eight percent of Americans in the $50K or less income bracket report that getting a special deal on the price is the most important factor for them when buying a car. At the same time, however, 36% of those in the $100K or more income bracket report that the brand reputation of the car is the most important factor.
Carvana intenders consider price more important than brand when shopping overall, so it makes sense that this would be the case for a major purchase like a car.
Users that have bought through Carvana have an extremely high probability (77%) of preferring trucks, SUVs, and vans to sedans and other small vehicles. People who plan to give Carvana a try are most likely in the market for a larger vehicle, rather than a typical sedan.
The global pandemic has had an immense impact on the population and all sectors of the economy, with some Americans just not comfortable going out in public regularly. Most people intending to buy through Carvana in the future have expressed some level of concern about being in public spaces (74%).
The primary reason for this correlation is likely a result of Carvana’s contactless shopping, transacting, and delivery process, which would allow concerned individuals purchase a car from the safety of their homes. But knowing that the majority of the Gen Pop 17 and older would never buy a car without test driving it reveals and overall marketing and advertising hurdle Carvana likely needs to jump.
More Americans intend to use Carvana than have already bought or sold through it, and overall awareness is high. If American car buyers can be convinced the price is right, and that paying money for a vehicle before test driving it has the potential to turn out okay, it’s only up from here.