Back in January, we published an article on Carvana named “Is Carvana Over? The Consumer Angle.” At the time the stock was trading at around $4.20 per share and there was serious concern that the company would have to file for bankruptcy. Since the time we published that article, Carvana’s stock rose to a high of $57.19 and is currently trading at around $47 per share. In the article we chose to take a different perspective from what we were seeing from the financial community at the time, and decided to deep dive into how customers actually felt about the company. We’ve continued to track consumer sentiment toward Carvana throughout the year by means of a 10,000N survey that we refresh quarterly, and if there’s one thing that we’ve come to realize, it’s that consumers really enjoy the Carvana experience.
This is not to say that we were “right” or that the company no longer faces the headwinds that it did in January (i.e. threat of bankruptcy, problems with unit economics, etc.), it’s simply a way of showing how the use of surveys to track consumer demand can provide a differentiated perspective on a company.
We published the latest refresh of the survey last week and consumers felt more or less the same as they had in January about their experiences using the online auto retailer. When it comes to competitive dynamics, Carvana ranked near or at the top in terms of things like pricing, selection, and overall trust, NPS for selling a car to CVNA has improved since January and currently sits at 58, which is a very strong score. NPS from those who bought from Carvana also improved and currently sits at a series high of 69.
Customers stated that the convenience of Carvana is what they enjoy the most about purchasing a car from them. Since the early waves of this survey, Carvana customers have grown less and less likely to visit a dealership before buying from Carvana. Customers firmly believe that Carvana is a better experience than a dealership, and indicate a high likelihood of shopping for a car there again in the future.
Simply put, customers that use Carvana love the experience and consumer adoption of buying used cars online are still in the early innings.
Excerpt of Charts:
