Traditionally, automakers have been skilled at getting consumers to buy. One needs to look no further than the critically acclaimed Ford v Ferrari, currently the No. 1 movie in the country. The plot focuses on Ford Motor Company’s entry into the sports car market in the 1960’s, and a now-famous gimmick designed to help the auto manufacturer sell more cars to teenagers.
Back then, selling cars was easier. Automakers could count on a fundamental fact of American life: You pretty much needed a car to get around. Fast forward to today and you’ll find an industry under siege.
The emergence of rideshare services has enabled on-demand access to transportation that’s radically altered consumer expectations for car ownership, particularly among Millennials and subsequent generations. Younger consumers are more likely to forego buying in favor of ridesharing or public transportation or push off purchase until later in life. And the emergence of driverless cars is only going to increase the stress on traditional behaviors of car ownership.
For those consumers who are looking to buy, navigating their path to purchase has become much more complex. Multiple visits to a series of dealerships are out. Today, the majority of consumers begin the car-shopping process online, researching options and making purchase decisions before ever stepping onto a dealer lot.
So, how can automakers respond to these threats and fight back against car ownership leakage? While manufacturers may not be able to stem the tide of ride sharing, there are steps they can take to respond to this new reality.
1. Align Messaging with the Path to Purchase
Nielsen research shows that people don’t shop for cars by simple process of elimination. When car shoppers are ready to buy, they consider twice as many cars as they did at the beginning of their journey. This presents a unique opportunity to influence buying decisions very late in the game.
This understanding of consumer behavior presents new opportunities to influence buying decisions near the end of the purchase process. In the late stage of the funnel, users are seeking decision-making materials, such as discount info, financing options and service contracts. By tailoring media and messages for late-stage buyers, automotive marketers can influence car buyers to take that all-important final step and buy a car.
2. Differentiate by Demographic
Each generation, from Baby Boomers and Gen Xers to Millennials and Centennials, has different needs, desires and goals. So it makes sense that each age group would shop differently as well.
For example, Millennials use their tech skills to do heavy research online before buying. They consult third-party rating and review sites, visit dealer sites, and seek reviews from friends and family before ever stepping foot on the lot. These insights highlight an opportunity for automakers to influence Millennials’ purchase decisions via digital channels.
3. Build Brand Awareness
Many automotive marketers today are so focused on bottom-funnel tactics designed to drive ‘quick wins’ for their business that they’ve lost sight of the importance of brand building. To find long-term success, marketers must strike a balance between top-of-funnel awareness efforts and bottom-funnel direct response tactics. Using the right type of data, automakers can fine-tune their use of media channels to do both.
For example, marketers can leverage TV to build top-of-funnel awareness and consideration (Nielsen research shows that traditional media like TV still rules in brand awareness). Then, as people get closer to buying a car and ad recall from TV drops, auto marketers can allocate spend to search, display, video and other channels to engage customers closer to purchase.
4. Measure and Optimize Advertising Performance
To optimize consumer experiences and drive desired outcomes online and off, automotive marketers need to identify which strategies and tactics best resonate with target audiences. Yet tracking consumer influence, engagement and conversion can be challenging, especially for offline activity.
To be effective, marketers must embrace new ways for communicating with and measuring their target audiences. Automotive marketers should start by establishing a baseline of de-duplicated, person-based reach and frequency across channels. Without understanding how many target consumers were reached, it’s impossible to assess campaign performance. From there, auto marketers should seek advanced measurement and modeling techniques to enable them to understand the true drivers of sales. With insights into what’s working and what’s not, they can make informed decisions that improve effectiveness and efficiency across their full spectrum of marketing investments.
From declining car ownership to the rise of ridesharing and more, the auto industry has become increasingly fraught with uncertainty. But even in this period of turmoil, new opportunities are emerging. By embracing the concepts above, automotive marketers can compete more effectively, and set themselves up for success in a rapidly evolving landscape.
To find out how using better data to target the right audiences at the right time can help you compete more effectively, download our ebrief: How Automakers Can Fight Back in an Industry Under Siege.
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