How to Research Your Market Before You Buy a Car for Turo

How to Research Your Market Before You Buy a Car for Turo

Turo is a great platform for those who want to bring in some side-change on top of covering the payments, insurance, and depreciation of a vehicle. There are a thousand reasons why I believe this to be true, but today I want to share what I’ve learned when it comes to researching your local market before buying a car.

Doing market research beforehand is vital to your Turo business as it will live or die depending on market demand for the vehicle. And by "market", I’m referring to the people who are in your area (or visiting) that will rent your car. Your market can slightly grow or shrink based on your delivery settings, which you can customize:

  • Airports that you’ll deliver to
  • Guest’s chosen location (any distance you desire)
  • Local pickup (wherever you keep the car)

I recommend giving as many options to potential customers as possible, especially as you start out.

I rent two vehicles in the Salt Lake Valley, and my friend who convinced me to start hosting on Turo is in Las Vegas, one of the best markets for Turo hosts right now. Before buying a luxury car to rent out, I noticed how different the search results for Salt Lake vs Las Vegas were. Many cars in Vegas have 100+ trips, while in SLC there were few above 50. That’s when I realized I needed to do a lot more research to be sure the car would rent in this fresher market.

Browse your local search results

This is an obvious one. However, there are some strategies you should employ while searching in Turo’s app. The goal is to find out what’s popular by assessing the number of trips, the type of car (luxury, utility, etc.), the price, and the dates of the reviews (if they’re spread thin, the car isn’t getting rented that often). In fact, you can almost guess how many bookings per month a car gets by doing this math:

(total # of trips) / (# of months since first review)

However, this won’t tell you how long each trip was. If I got only 2 bookings next month but they were both 8 days long, I’d be much happier vs 16 overnight trips.

Vary the trip length

Hosts can put a minimum trip length for their cars. Those who are experiencing higher demand can be picky about the trip length, and you don’t want them to be hidden from your results. Try 1 day, 3 days, and week-long trip lengths and see what shows up.

Look into the future

Try setting the search to at least one month out. That way the search results aren’t hiding cars that are booked during the selected date range.

Browse the search results of other markets

The purpose behind this is to discover what are the popular cars, and what about their listings is making them popular? Are the photos eye-catching and/or verified by Turo? Does the host have a great reputation? Is it the context of the car? (For example Jeeps by the beach or minivans in family-oriented Utah. And yes, minivans do exceptionally well in Utah.)

Experiment with your current vehicle

You should list your other vehicles on Turo to see if the bait gets a nibble. If you create a great listing (I’ll write another post on that) and list it for a compelling price but no bookings come in after two weeks, your market might be too immature.

The Turo Blog

This is a solid, data-backed resource straight from the hand that feeds. There are two places specifically you need to look:

Turo Market Guide

Turo creates market guides every so often and they are full of goodies. Here’s one for the tri-state area, for example. If Turo made a post about your market, study it religiously. If your region doesn’t have a market guide, pick one that most resembles your own and remember: larger, trendier cities will always have more mature markets.

Turo Year-in-Review

Turo wrote a year-in review for 2017. Compare how renters’ habits changed from the previous year. Check out what’s popular and what isn’t. One of the most important takeaways is this:

Luxurious and unique listings consistently garner the most earnings, but travelers and locals love daily drivers, too, for their affordability and convenience.

Google

Google Trends

You should check out the search trends for each state. While most booking activity happens in the actual Turo app, you can get a rough idea of the overall market size for your state. However, as I mentioned before, larger cities will have more activity. Google Trends doesn’t have accuracy down to the city-level.

Search “Turo <your city here>”

What you might find is a page similar to this. If your city has one, you’ll get good info concerning how many hosts there are, their locations, and links to other nearby city pages.

List the car before you buy it

You read that right; I saved the best for last. Use the dealer photos and make up a temporary license plate number (when you take the car off the lot, they give you temporary registration anyway). Set your availability dates to after your proposed purchase date and see how it goes. If you get a booking or two in a short amount of time, you’re on to something. If not, maybe you should give the dealer the run-around for a bit. I’ve noticed a lot of my bookings happen less than 18 hours before the start time, so take that into account if you set your available dates one week out. If you get a booking but chicken out anyway, cancel the reservation.

Good luck, and make sure you subscribe to my newsletter (scroll to the bottom)!

 


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