Harnessing Automotive Advertising Dollars in an Unprecedented Market
Bob Sillick | for editor and editor
The automotive industry and its dealerships face many challenges. Although consumer demand remains robust, an ongoing microchip shortage and numerous supply chain issues have resulted in very limited dealer inventory. All have driven average dealer advertising per new vehicle down from $640 for 2020 to $541 for 2021.
Nevertheless, there are automatic advertising dollars available for the media salespeople and advertising agencies with a better understanding of today’s market and where it is headed. Mike Blinder, Publisher of Editor & Publisher, and his guests discussed this opportunity during a January 2022 Editor & Publisher vodcast. They offered ideas on how to reap more of those ad dollars.
Jim Brown, President of Borrell Associates, provided detailed information on the company’s recently released 2022 Local Automotive Advertising Outlook. He revealed how car dealerships’ advertising spend has changed as they try to compete in this unprecedented market.
In traditional media, Borrell predicts that automatic ad spend for newspapers will increase 11.9% for 2022, the biggest increase since 2016, but decline 18.2% for 2023.
“Our forecast for 2022 is based on the many dealerships turning to print media, primarily to get more used cars for their inventory,” Brown said. “While this is a short-term priority, dealers can use their used car sales pitch to emphasize the value of visiting the dealership to have that vehicle serviced and committing to on a personal level with these clients.”
Pat Norris, senior vice president of revenue initiatives at JDA Media, had a similar message.
He acknowledged that digital media is important to dealerships, but leaves the entire shopping experience in the hands of consumers. they decide what to buy and where and with little interaction with the dealer.
“The value of traditional media to dealerships is always an opportunity to present advertising messages that differentiate a dealership from its competitors,” Norris said. “Humanizing the message and emphasizing why consumers should buy from the retailer will drive the market.”
Richard E. Brown, head of digital subscriber churn for Gannett/USA Today and editor and publisher contributor, agreed with Brown and Norris that humanized messages still resonate with consumers because they make appeal to their emotions. Consumers want to know that the dealership understands them and their buying habits and that the dealership is always ready to help them with their transportation needs.
He added that establishing a relationship of trust with the market is not easily transmitted in the digital channel. Yet when dealerships use digital media, it needs to be on a granular level because consumers are very detailed when researching and selecting a vehicle.
“Consumers don’t always remember what a reseller says, but they do remember how the reseller made them feel in the moment,” Brown said. “This emotional connection will compel consumers to remember what makes the dealership different, and they will find those values appealing.”
All panelists agreed that the current automotive market situation is temporary. Inventories are unlikely to return to “normal” levels until the second half of 2022. Media vendors and advertising agencies must adapt to today’s unique conditions. They also need to prepare for electric vehicles (EVs) – the next big change in the automotive market. All major automakers will introduce several new EV models in 2022 and subsequent years, requiring a different set of humanized advertising messages to gain maximum share of the EV market.
Bob Sillick has held numerous leadership positions and served myriad clients over his 47 years in marketing and advertising. He has been a freelance/contract content researcher, writer, editor and manager since 2010. He can be reached at [email protected]