Why Your Dealership Should be Targeting Shoppers with Digital Advertising
The US Automotive industry is spending big on paid digital media. eMarketer forecasts that spend will hit $9.94 billion this year and will climb to $14.14 billion by 2020, for a compound annual growth rate (CAGR) of 13.7% from 2015 to 2020. This is second only to entertainment with a slightly higher CAGR of 13.8% for the same forecast period.
Automotive marketers are also spending heavily in other digital channels, with eMarketer predicting spend to rise from 12.7% in 2016 to 13.4% by 2020 in overall US digital spending. Automotive is the second-largest industry for overall digital spend, ranking only after retail.
Traditional media still has large appeal for many automotive dealerships. However, it’s not about ditching the mailers or radio spots, but rather about adding additional online channels to target consumers across the entire purchase journey.
Google estimates that six out of ten car shoppers enter the market unsure which car they are going to buy. After they talk to family and friends, 85% to 90% of shoppers’ next step is to conduct online research. This search may start with a search engine or a review website and hopefully continue until they reach your brand’s domain. With the right data and solutions in your place, you can target your customers based on their behaviors and be in the right place at the right time precisely when they are looking for you.
The first brand searched is the same brand purchased only 22% of the time. Research conducted by IAB in partnership with Prosper Insights found that automotive shoppers are 71% more likely to be influenced by digital advertising across multiple retail categories than the average consumer. This presents a huge opportunity to connect with auto shoppers as they are researching and considering different brands.
Digital Advertising is Now More Targeted
When display advertising first arrived on the seen in the late 90s, the focus was on getting as many impressions and click by displaying as many ads on as many websites as possible. There was little focus on the user experience, personalization, or targeting shoppers who may actually be in market to buy. Of course, digital advertising has come a long way since then and the focus has evolved to targeting the right buyers with personalized offers and a positive user experience.
There are many types of digital advertising available today, some examples being:
- Banners ads (These include skyscrapers, full banners, squares, and buttons.)
- Adsense (Ads served to consumers via Google)
- Native Advertising (This continues to grow and dominate the online advertising space.)
- Facebook Ads
- YouTube Ads
- Sponsored Tweets
- Rich Media Ads
With so many options available, it’s important to only focus advertising spend on those consumers who are most apt to purchase. For example, customized audience can be created to target auto consumers by segments such as motorcycle enthusiasts or car enthusiasts. Ads can be served specifically to consumers who have indicated they are in market to purchase, and these consumers can even be further segmented by types of car they are in market for such as SUV, truck, small car, luxury vehicle, or SUV. Or perhaps consider targeting consumers with specific vehicle budget ranges.
The Growth of OTT (Over-the-Top)
OTT has emerged as one of the fastest growing sources of ad views. The value of advertising and subscription fees for OTT (over-the-top) video streaming services by 2020 is expected to top fifty billion dollars. OTT services include the likes of Netflix, Amazon Prime, Sony Crackle, and Hulu, as well as major publishers and television networks.
Tru Optik, a media-intelligence and ad-tech company, is one of the first companies to be able to bring the precision and scale of digital targeting to Connected TV and other OTT screens. The company combines data-management, campaign-activation and audience-measurement capabilities to enable media companies and advertisers to segment, measure and engage OTT audiences.
According to Tru Optik, “Understanding the online viewing behavior of the nearly one billion consumers who stream and download TV, movies, and video games over the Internet is the holy grail for media companies. Industry leaders are in jeopardy of losing billions of dollars, as ad revenues and subscription fees flow from traditional TV and movie distribution channels to digital platforms like YouTube and Facebook that allow consumers to access content on-demand across an array of devices and screens. Those platforms also collect information that enable advertisers to target their messages with greater precision. OTT streaming of TV, movies, and games generates similar information; however, until now OTT data has not been collected and organized in a way that supports large-scale marketing activation.”
Car buying is no longer a localized activity thanks to the advent of the Internet and digital channels. Consumers do their research and may sift through hundreds of listing before they find a brand and dealership that captures their attention, regardless of location. With the availability of so much data today, automotive marketers have unprecedented access to numerous data sets in order to pinpoint and target the right audiences specific to their brand.