Marketing Insights to Expand into Electric Vehicles

Even though electric vehicles (EVs) are still a small slice of the overall automobile market, their demand is skyrocketing, fueled by concerns over climate change and air pollution. The International Energy Agency reported that first-quarter EV sales in 2024 surged 25% compared to the same period in 2023. By 2035, sales of battery electric passenger vehicles are projected to hit 44 million units, a massive leap from the 7.3 million units sold in 2022.

As more automakers shift gears from internal combustion engine (ICE) vehicles to meet this growing demand, a YCCI study explored how they can effectively stake their claim in the expanding EV market. Through interviews and an analysis of the behaviors of ICE, hybrid, and EV owners, YCCI researchers uncovered key motivations and psychological barriers regarding EVs. 

Safety + Battery Concerns
The YCCI team discovered that EVs are often seen as safer than traditional ICE vehicles. Consumers assume that advancements and innovations in technology go hand-in-hand with improvements in other safety features. However, when it comes to batteries, some consumers expressed a worry about the safety of electric vehicles, spooked by tales of battery explosions in EVs and other gadgets powered by lithium batteries. This presents a delicate balancing act for EV marketers: while there is a perception that EVs are safer to some extent, battery safety concerns need to be addressed head-on.

Additionally, some consumers expressed a belief that EV batteries, despite being one of the priciest components, don’t have a adequate driving range compared to traditional cars, especially relevant for long drives. The fear of overcharging or undercharging – and the hefty replacement costs that might follow – looms large. However, some consumers found comfort in the idea of charging their EVs like they do their phones at night, seamlessly integrating into their daily routine, in contrast to ICE vehicles that require periodic trips to the gas station. By focusing on the convenience of never having to visit a gas station again and emphasizing the simplicity of at-home charging, marketers can attempt to combat concerns about how batteries will impact their driving experience. 

Aesthetics + Signaling
Consumers are torn when it comes to looks and aesthetic appeal of EVs. YCCI found that some find EVs less appealing than traditional cars, while others consider them to be sleek, sporty, and modern. But there is an important social signaling element underpinning consumer motivations in this space—how being seen driving an EV looks to others has interesting social and political implications. The study found that EV owners can be keenly aware of the attention their cars attract, differentiating them from ICE owners. One study participant likened driving an EV to turning heads like a “hot guy/girl” would. Leaning into this insight, YCCI found that advertising with messaging around self-presentation and “showing off” increased purchase consideration by 7% in an A/B test, compared to standard EV messaging. However, some consumers expressed concerns that driving an EV might make them seem “smug” and politically liberal, so it’s important to be aware of the audience when leaning in on these beliefs.

A Better Benefit
Historically, EV marketing has focused on big-picture benefits like saving the planet and reducing carbon footprints. However, YCCI’s research found that some consumers resonated with benefits closer to home. In interviews, EV owners noted the importance of immediate health benefits of driving an EV, such as cleaner, emissions-free air to breath. In an A/B test, ads emphasizing immediate health messages like “Our family will appreciate the clean air on the drive” boosted purchase likelihood by 9% over standard EV advertising. 

Conclusion
For companies expanding into the EV market, these insights suggest a well-rounded marketing strategy should tackle consumers’ battery and safety concerns, highlight the micro-benefits of owning an EV, and consider aesthetics and signaling across target segments. By aligning marketing with these consumer insights, manufacturers could look to effectively carve out a slice of the rapidly growing EV market.
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