Premium video content, audience targeting, and measurement will be the key to success this year.
The automotive industry is experiencing a full-blown transformation, resulting in major disruption to the standard ways of business. New tech platforms are empowering consumers with alternative ways to navigate the car buying process and allowing them to do it on their own terms. Diverse segments, models, and the variety of EV options continue to enter the market monthly, providing customers with unprecedented choice. Consumer loyalty is at a six-year low, forcing a critical question for both dealers and manufacturers: how to retain their existing base while seizing new market opportunities?
Further, the way that consumers engage with media has become increasingly fragmented and complex as video content has proliferated across platforms screens, and devices. This is making it increasingly difficult for brands to find and reach specific audiences across various endpoints. On top of this, signal loss (a result of cookie deprecation, privacy legislations, etc.) is further impacting the ability for marketers to accurately target and measure audiences.
With change comes an abundance of new opportunities for auto retailers to really lean into. Let’s look at how things across the auto industry have changed and four things auto advertisers can do today to thrive in the current market:
Focus on Lifetime Value, It’s Essential
When inventory supply was heavily constrained and consumer demand healthy, dealers typically focused their marketing efforts on the bottom of the funnel to capture existing demand, often neglecting demand generation and branding strategies. Although sales came easier, a byproduct of those dynamics was an erosion of retailers’ brand equity in the market.
With inventory building back up, advertisers should look to reestablish their brands and drive lifetime value while maintaining their ability to convert lower in the funnel. It is imperative that they reach consumers at all stages of the buying process, from customers that are ready to buy, considering buying or are still in need of awareness.
Auto marketing strategies need to be about more than the immediate sale. Nurturing potential customers from initial consideration to purchase fosters brand loyalty, encouraging repeat business for future needs and services. Loyal customers are more likely to return, ultimately driving higher lifetime value and competitive advantage. By utilizing targeted messaging throughout the consumer journey, auto advertisers can cultivate deeper, more meaningful relationships, maximizing the return on their marketing investments.
Use First-Party Data Now to Overcome Cookie Deprecation
For decades, the use of third-party cookies has allowed marketers to easily utilize digital tactics to target in-market shoppers along their journey. But with the deprecation of cookies in sight, auto retailers should lean further into first-party data of their own as well as their partners to understand their customers and deliver more targeted advertising messages.
While cookies may be going away, there are audience matching and targeting tools available now, such as addressable TV advertising. Addressable allows advertisers to more accurately identify and reach consumers across screens. It also offers the ability to advertisers to deliver specific creative messages to different audiences, making it easier to customize ads so they are more relevant to where the audience is in their buying journey. All while providing better insight into campaign effectiveness and performance.
The way that people buy cars continues to evolve, so it is important to connect with the right audiences at the right time. Leaning into these audience tools will allow advertisers to more effectively and accurately reach potential customers and buyers.
Reach Audiences in a Premium Environment
More than ever, advertisers need to reach audiences where they are engaging with content. This has become an increasingly difficult task as premium video continues to fragment across platforms and devices. It’s no longer just about identifying the appropriate audience but communicating with them in a premium environment. Based on feedback from buyers and sellers as well as viewers, Comcast Advertising defines premium video as being delivered transparently, in a brand-safe environment, and seen by a real person within a high-quality viewing experience. Ads delivered in premium environments have been found to lead to better brand building and better ad recall. Unaided ad recall was 58% higher for ads in premium video environments compared to non-premium environments.
Using a strategic multiscreen combination of traditional TV and streaming will allow auto advertisers to harness the power of premium video. In fact, research has shown that there is a +23% higher conversion rate with multiscreen TV campaigns.
Make Sure Measurement is Part of the Ad Process
Auto advertisers also must ensure they measure those audiences to understand if they increased web visits, conversions, and ultimately sales. Comprehensive reporting and attribution tools that use ad exposure data can provide clear and concise insights into campaign performance and the true business impact of ads. Insights like audience reach and frequency can also provide actionable learnings for best practices and optimization. Without these robust measurement tools, advertisers are unable to have a clear understanding of what is and isn’t working within their campaigns at all stages of the marketing funnel.
Drive Towards Success in 2024
2024 will be a pivotal year for the auto industry. To be successful in the year ahead, advertisers should focus on refreshing their marketing strategies to better reach and connect with audiences as media consumption and buying habits evolve. The best approach will be to focus on driving lifetime value and reaching viewers in premium video environments while utilizing audience and measurement tools to deliver effective campaigns to valuable audiences.
To learn more about how to evolve your auto marketing strategy, visit the Effectv auto industry page or contact us to speak to an auto expert.
Sources:
1. Brand Loyalty Among US Auto Consumers Drops to Six-Year Low, IHS Markit Report, 2022.
2. Comcast Advertising, MediaScience Study, May 2023, consumer survey responses, N=284.
3. Comcast Internal Analysis of Ad Exposure data matched to Polk new vehicle sales using BlockGraph (2021). Based on comparison of 20 dealers across 10 zones (2 dealers in each scenario. Time period, geography, and investment were consistent across scenarios).
