The connection between one’s eyeballs and one’s wallet is well founded. It explains everything from the ancient advertisements that survive among the ruins of Pompeii to Google’s current market capitalization of $1.38 trillion.
However, we wondered about something more specific: Does an increase in a car’s popularity on the internet correlate to future increases in value? And if so, can we use internet traffic today to predict which vehicles will be worth more tomorrow?
Reverse engineering a price surge
This potential link came to light when we were investigating leading indicators that could have helped us predict the 1958–1971 Subaru 360’s astronomical value increase earlier this year. Here was a car that for years flew under the radar and then, in the matter of a few months, quadrupled in value. Was there any indication that we should have expected this?
Often, prior to an increase in value, we’ll see an increase in people calling about insurance for the car and/or citing higher values for it on existing insurance policies. This is one of the many variables we use to narrow down our Bull Market picks. For the Subaru 360, however, insurance activity didn’t trigger any alarms. From 2019 to 2020, quotes increased only modestly while the average quoted value only increased 13 percent to $14,200—still less than half its current average price guide value. During the same period, the number of 360s for which Hagerty provided insurance policies, and the agreed values for those cars, remained flat.
Prior to quadrupling in value, the little Subie wasn’t getting much attention—or so it first appeared.
We needed to look further back in the buying process, when the future owner was just a shopper. Before a potential buyer submits an insurance quote, they usually start researching the car on the internet. Since one of their questions is bound to be “How much will this cost me?”, we at Hagerty can capture car research activity with the Hagerty Valuation Tools website.
Sure enough, there was a major increase in internet activity (HVT price lookups) for the Subaru 360 about 18-months before the value quadrupled.
Just a coincidence?
We looked for other moments in recent years where a vehicle’s average value increased 50 percent or more in a single four-month span. This has happened 13 times since the January 2018 Hagerty Price Guide. And 12 of those times—or 92 percent—were led by a sizable traffic increase. Specifically, in these instances, internet traffic doubled at some point over an eight-month period.
The 1978–79 Ford Bronco is an example of this phenomenon: Internet traffic more than doubled in late 2018 and continued to grow through early 2019. Average value then increased 55 percent from January 2020 to May 2020.
The magnifying power of the internet
We thought we might be on to something. We thus took a look at the rest of the vehicle generations in the Hagerty Price Guide. More than a third (36-percent) of them had a moment where traffic doubled over an eight-month period between 2018 and 2019. These “test group” vehicles saw an average value increase of 6.6 percent in 2020, more than double the 2.9 percent increase in value of our “control group” (i.e.: cars in our price guide that didn’t see the big bumps in web traffic).
In fact, internet traffic doesn’t need to double for the correlation to appear. As seen in the chart below, any magnitude of internet traffic increase led to an average value increase that outpaced vehicle generations without one. Note that the gap widens as the magnitude of the traffic increase gets larger.
The source of increased internet traffic could be anything. In the case of the Subaru 360, there were a few media spots in 2018 that likely caused the bump: a Petrolicious video from March 2018, a CNN article from July 2018, an Automobile article in December 2018. We often see massive spikes in traffic for obscure cars when one is reviewed by a popular YouTuber like Doug Demuro and it’s introduced to a few million potential buyers. In reality, the source doesn’t really matter. The point is that more people are researching the car, which leads to more potential buyers, which leads to a seller’s market and increased values.1
The power of that magnification differs depending on the type of car. Grouping cars by value (below), we see the percentage increase in value narrows considerably as cars become more expensive—with the exception of cars in the $250k to $500k value range. In fact, the internet stars in this price bracket performed remarkably better than those that didn’t see significant traffic increases.
A surfboard, not a speed boat
The correlation is clear: A vehicle with an increase in value often has a corresponding increase in web traffic. But how often, exactly, does that correlation occur? Here, the picture becomes fuzzier. The likelihood of an increase in internet traffic leading to a value increase is about 57 percent, on average. In other words, only slightly better than a coin flip. More telling: The frequency is roughly the same chance as generations that don’t experience traffic increases.
It may sound odd that internet traffic could greatly impact the amount of a value increase but tell us little about whether there will be an increase at all. Zoom out, though, and it makes sense. The collector car market, like any market, is buffeted by many forces. In the period we looked at, prices could have been impacted by, among other things, a pandemic; a sudden recession resulting in massive unemployment; an infusion of government stimulus money intended to ease said recession; cancellation of many collector car events and auctions; massive growth in online car selling platforms; fluctuation in oil prices; Brexit; and general boredom among people with disposable income.
Amidst all that, whether a car appears in a particular YouTube video is just one data point. Rather than determine price trends, internet traffic seems to magnify the effect of what is already happening. Imagine a huge wave: Web traffic is a surfboard.
A possible and important exception could be cars in the $50k–$100k price bracket. For these vehicles, a doubling or more in web traffic increased the likelihood of a value increase by 20 percentage points.
Now let’s look at some specific examples. Click on the filter below this chart to see web traffic and price trends for four web standouts.
The 1993–1998 Toyota Supra Mk IV has been hot the last couple years. Average values increased 25 percent from July 2018 to January 2020 in the wake of internet traffic doubling in early 2018. Since then, values have remained flat. However, there is currently a substantial internet traffic increase where the 4-month average has more than doubled since September 2020. Is the Supra getting ready for round two?
A direct competitor to the Mk IV Supra, the 1993–2002 Mazda RX-7 FD has experienced similar growth in recent years. Values increased 44 percent in the year following the moment in early 2018 when internet traffic nearly doubled. Traffic is on pace to double again, and could be a sign that the FD RX-7 is no where near it’s ceiling.
Even as vintage Japanese SUVs have taken off, values for the so-called Iron Pig have remained relatively stable. Since the massive traffic spike in late 2018, values increased a modest 12.5 percent. The recent 400 percent increase in web traffic may tell us that the FJ55 may soon reach the heights of its Land Cruiser brethren.
Not all beneficiaries of web traffic spikes are Gen–X and millennial fodder. The number of lookups for the Chrysler Town & Country has more than doubled in the last eight months. Note, however, that this car also exemplifies how clicks don’t always yield value increases: An even bigger traffic spike back in 2018 couldn’t stop prices from sliding, as they have for many American classics of this era.
No crystal ball
What we have is one more leading indicator with which to analyze classic car values and understand what’s happening in our market. Like all leading indicators, it’s an imperfect one. The popularity of a particular vehicle on YouTube shouldn’t in and of itself be reason to buy one. Unless, of course, watching those videos reminds you that you’ve always wanted that car and would love to see it in your driveway, values be damned. That, at the end of the day, is the whole point.
- Data Disclaimer: Hagerty Valuation Tools internet traffic was captured using Adobe Analytics. Only organic traffic was used, meaning any traffic sent to a Hagerty valuation page through a Hagerty article or video was removed. Vehicle generations ranked in the bottom third by total visits and generations added to Hagerty Valuation tools after January 2019 were removed from consideration. This left 967 generations for the correlation calculations. A four-month moving average was used because it helped smooth outlier months and matches the Hagerty Price Guide release schedule. The eight-month traffic increase window used for the correlation calculations falls inline with two consecutive price guide releases.