Sep 30 2013
Basis Team

The Automotive Customer is More Elusive Than Ever Before


The typical automotive customer is fickle and savvy… and older (I will address that latter point in a bit). Research firm Polk states that brand loyalty in the auto industry is about 48%, meaning that more than half of any OEM’s consumer base will defect to another brand. Furthermore, according to software firm idio, car consumers now use 18+ digital sources to research automotive content before they even step foot onto a dealership’s lot. A wealth of information is easily accessible from any device, and it’s no wonder that consumers can switch brand loyalty quickly and easily. With 41 new vehicle launches set for 2014, it’s important that automotive advertisers understand how to capture consumer interest through these channels and differentiate their products.

What to Do

Given that 60% of consumers will abandon a brand because of a poor online experience (according to eMarketer), it’s important to have strong digital presence and experience. For example, 63% of consumers have watched an online video as part of their automotive purchase process. With 81% of consumers deciding on a vehicle within three months, dealerships must quickly build and execute campaigns that drive more foot traffic and increase sales of new vehicles. Additionally, with new digital formats and executions being rolled out, brands have an opportunity to differentiate their experiences with customers. Using technology, automakers can understand who is in-market. The question then becomes, how do you most effectively reach and engage the market?

Marketing Fundamentals

Successful automotive advertising has always been driven by local and contextual content. While the media environment has changed, where the Internet and technology now play a larger role in a consumer’s media consumption, the fundamentals have stayed the same. Local and contextual media reaches enthusiasts, and people near dealerships, which generate sales. However, local and contextual marketing has become more difficult. What was cheap and easy to do in traditional media has become challenging and more costly. Auto brands still need local and contextual solutions that come with the four key ingredients fundamental to successful advertising – scale, impactful creative, guaranteed placement and transparency. It is worth mentioning that a new tech-driven advertising tactic such as real-time bidding (RTB) has sprouted to offer scale and pricing leverage for automakers and the agencies that serve them, yet it is missing guaranteed placement and transparency.

The Opportunity

New auto sales are expected to jump 6.6% this year. Dealers are likely feeling this impact directly, where they are averaging $38.4MM in annual sales. Furthermore, a KPMG study stated that 83% of U.S. auto executives predict that online activity for dealerships and intermediaries will increase. Much of this is a result from the behavior of older consumers. Analyst firm eMarketer pointed out that 62% of new vehicle registrations are from folks 50 or older, and 24% are from people from 35 to 49 years of age.

How do smart auto marketers capture (more than) their fair share? To differentiate their campaigns, marketers need a deep understanding of consumer behaviors and lifestyle interests that drive their brand’s perception. By using this insight to define consumer segments, marketers can map out where they need an impactful digital presence. Plus, this needs deep customization based on each OEM, with each brand, in each region of the country.

Digital advertising in the automotive industry is filled with competitors and noise. To stand out to key audiences, OEMs must approach digital with a strategic and differentiated strategy.

For more information on how Centro powers campaigns in the automotive industry, please visit: