ANALYTICS

How to compare apples and oranges?

You were always told not to compare apples and oranges? Generally, that's true - oranges are much better! But in practice, we often need to compare different goods and services to decide which one brings us more value, like traveling or renovating the bathroom

When it comes to buying a car, you face the same dilemma. You may start with two scenarios: 1) in your search, you've spotted a 2020 Honda Civic with 50,000km for $25,000 and a 2021 Toyota Corolla with 65,000km for $23,000. How do you objectively choose between these two cars? 2) The second scenario is even more challenging: you have a budget of $25,000 for your next car and you don't really have a preference. How do you choose the car that brings you the most value for $25,000??

What metric to use for comparing cars?

These two scenarios boil down to the same question: how do you measure the value that a car brings you in order to compare any make or model? The answer that CarSnatch has found to this question is the 'Attractiveness Score.' This score ranges from 0 to 100 and measures, for each car, the price difference compared to the market for the same characteristics. A score of 100 means that your Honda Civic is cheaper than 100% of the Honda Civics with the same characteristics, a real bargain! Conversely, a score of 0 means that you have a 100% chance of finding one cheaper on the market, so wait before buying

How is the attractiveness score calculated?

First, CarSnatch uses its pricing model to generate the distribution of prices for a model with its characteristics, for example, the price distribution for a 2021 Corolla with 65,000km on the odometer. Then, the probability of our Corolla's price (e.g., $23,000) is calculated using this distribution, by measuring the area under the curve to the left of the vertical line that passes through $23,000. This area varies between 0 and 1, and the attractiveness score is simply this area x 100

Conclusion

We still can't compare apples and oranges; the attractiveness score is calculated only for vehicles. For your next vehicle purchase, whether you start with a budget or have specific models in mind, the attractiveness score will help you sift through the used vehicle market and uncover hidden gems! Use the free newsletter or the customized search to take advantage!