CDK's purchase of Auto/Mate may create a major disruption in the dealer management system (DMS) industry. Here is our take. DOWNLOAD
Jack Loechner wrote a great article for Borrell Associates about the shift towards digital marketing for automotive dealers. He postulates that automotive as an ad category is responsible for changing the local media landscape with regards to the growing digital marketing spends and lessening of newspaper, radio and TV advertising. Now that newspapers and radio have given up their ad revenue to digital solutions, traditional TV is thought to follow suit.
Automotive is the largest ad category behind general merchandise. According to the article, overall car sales are up 5% and ad budgets up 17%. Digital marketing accounts for 95% of this budget increase. With less dealerships overall, a lower cost-per-vehicle with regards to digital advertising, and a surge in used car purchases, dealerships are quickly taking advantage of the high quality traffic that digital marketing can deliver. Since more than 90% of car purchases start with online research, dealerships are becoming more like fulfillment locations than full-fledged stores. This means that every walk-in is more likely to buy.
Despite the online landscape becoming crowded with every dealer devoting budget to getting zero moment of truth customers, digital marketing definitely presents an efficient and affordable way to advertise a dealership's vehicles. As marketers, do you still run into dealerships that are decidedly "old school"? Any that still run print and radio ads?