Nielsen Research Offers New Insights for Auto Marketers

October 30, 2018 Ginna Hall

128 million Americans drive to work every day. Before and after work, we drive to the store, run errands, drop the kids off at school, sports and friends’ houses ... we spend a lot of time in our cars.

For many drivers, our vehicle is an extension of our personalities and our lifestyles. We take pride in our cars and put a great deal of time and effort into selecting a make and model that will be a good fit.

As a result, buying a car is a long and complex process. It’s expensive, so we tend to be deliberate about it. It’s also a decision we live with for years, so we review every option, of which there are many. This year alone, there are 412 distinct car models in the U.S.

Consumers buy a new car every six to seven years on average. Auto marketers craft sophisticated incentive packages and advertising campaigns to sway these buyers. The industry spends $35 billion a year in marketing initiatives in the U.S.

Even as car sales have slowed in the past couple of years, automotive remains one of the top-spending advertising categories on the national stage, and by far the top spender on local media.

Auto marketers face a crowded market in which it’s increasingly difficult to connect with consumers. It’s a steep challenge that can only be overcome with an understanding of how people shop for cars and how they are influenced by advertising.

Marketers in the auto industry can get new insights from a recent report: The Nielsen Auto Marketing Report. Based on over 220,000 online surveys conducted by Nielsen with prospective car buyers in the U.S, the report offers brand, consumer experience, and media findings to help marketers.

Here are some of the findings from the report. [Download your copy of the report here.]

Generational Differences: Start Catering to Millennials

The majority of new vehicles are purchased by consumers over 40 years of age. They represent 62% of the adult population in the U.S. and account for over 75% of all new car sales. While this population largely consists of Gen Xers (ages 40-54) and Baby Boomers (55+), Millennials are coming of age in terms of buying power.

Currently, Millennials are half as likely to buy a new vehicle as their older counterparts. Their brand preferences, however, will have a big impact on the auto industry in the future. Considering how long the purchase cycle is for cars, it’s not too early for auto marketers to start catering to their needs.

Each generation has distinct media habits. Auto marketers can expect to reach more Millennials on TV-connected devices, computers and smartphones than Baby Boomers. TV reach is higher for Gen Xers and Baby Boomers. Radio is the only media that reaches more than 90% of all three generations—95% of all Gen Xers and 92% of all Millennials and Baby Boomers.

Brand Awareness: Quality is More Important than Quantity

There’s a misconception that car shopping is a process of elimination, in which buyers start with a list and cut brands one by one until a final choice emerges. Actually, the process doesn’t follow this linear path at all. Instead, the number of brands under consideration increases as the buyer gets closer to a decision.

Nielsen researchers asked prospective buyers which brands they think of without being prompted and to identify brands they know from a list of 34 car makers. Seventy-five percent of all car buyers reported that they intended to purchase their top of mind brand. This brand has a significant advantage over others before the consumer ever sets foot inside a dealership

It turns out that not all brand awareness was created equal. Quality is significantly more important than quantity. Those that recalled brands without being prompted had 10x purchase intent versus those that were prompted.

> > Read How Digital Marketing Is Fueling the Automotive Industry

Align Media With the Auto Path To Purchase

Car shoppers start out on the path to purchase by considering two to three brands on average. By the time they’re ready to buy, they typically have five brands under consideration—nearly twice as many as they started with.

It’s clear that, as a marketer, you need to build deeper connections with consumers—not simply awareness for its own sake. It takes a media-agnostic, customer-first marketing approach to build these connections long before prospects are actively in the market for a new car.

Collectively, your media touchpoints with consumers – throughout the path to purchase – must reinforce your overall brand story and elevate it in consumers’ minds.

Traditional media such as TV or radio are critical to building upper-funnel awareness. Marketers can leverage high-reach media to build awareness and fill the top of the sales funnel.

Digital media is particularly effective at driving mid- and lower-funnel engagement and conversion. When marketers reinforce messaging across all media touchpoints they remain part of the consideration set as prospects get closer to visiting a dealership.

Build Awareness and Relationships with Omni-Channel Marketing

Media channels, when consumed together, are greater than the sum of their parts. Nielsen analyzed the impact that TV and social media consumption have on their own and in combination across both awareness and consideration metrics

It found that TV viewers who use social media have a greater purchase consideration than TV viewers who do not use social media. Even among light TV viewers (< five days a week), purchase consideration increases by 17% when TV and social media are used together.

What is clear is that automotive brands should leverage a coordinated mix of broad reach and targeted media, with careful consideration of the synergies between channels. This means using TV and radio for brand building throughout the path to purchase and combining these efforts with digital (including social), mobile, direct mail and even in-theater advertising to encourage purchase consideration.

The key is to develop campaigns that can deliver on both fronts: building long-term brand equity and capturing people’s attention when they’re weighing their options.

New Marketing for the Digital Era

Auto marketers have many more channels at your disposal than you’ve ever had before to reach car shoppers efficiently and effectively. You also have more data about car shoppers to guide your audience segmentation, targeting and creative decisions.

This level of consumer insight, coupled with the right marketing and strategic measurement technology, can help you deliver relevant advertising, optimize campaigns, improve customer experience, generate more dealership visits and engage the car buyers of the future.

Learn More

Download your copy of the Nielsen Auto Marketing Report and learn even more about today's auto buyers.

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