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Why New Doesn't Always Mean Better for Auto Industry Marketers

Global advertising spend is expected to exceed half a trillion dollars for the fourth year in a row, and American brands are once again fueling that growth. The main difference this year is that U.S. companies are expected to spend more on digital advertising than traditional media, with digital predicted to account for 54.2% of total advertising.

It’s completely natural for auto dealers to get caught up in the new digital marketing tools and technologies hitting the market — especially when many providers guarantee results to accompany that new technology.

Car dealerships, like all good companies, follow the money. Digital marketing provides enhanced analytics for assessing traffic, clicks, engagement, and other metrics that are difficult to track via traditional media. Whether digital is more effective is debatable — research from Bain & Company found that customer recall of digital ads is worse than with other media types.

A growing number of dealerships have turned to digital marketing — particularly to sell new cars — while relying on traditional media to promote fixed operations. A healthy balance of traditional media, like point-of-purchase and similar in-store displays, can significantly boost customer awareness of service specials, parts discounts, or inventory-related sales and markdowns. Given the unique advantages of both approaches, a balanced media mix can prevent one tactic from cannibalizing the other while ensuring you get the most mileage out of every campaign.

The Middle Lane

The last thing marketers want to do is confuse their audiences. Keeping your brand message consistent on all channels ensures that customers see your brand clearly. You should, however, experiment with a variety of tactics depending on your business goals.

For instance, digital marketing is great for driving short-term awareness and particularly helpful when shoppers are seeking information or weighing their options. Digital tactics can be extremely effective for developing top-of-funnel awareness of services, parts, or deals. If you’re interested in driving overall brand awareness, traditional channels like TV, radio, and billboards can be incredibly effective — though these placements tend to be more costly.

By contrast, direct mail is proven to be the most effective at driving purchase consideration. This tactic is useful when engaging prospective customers who are further into the sales process and closer to making a purchase. While traditional channels might seem dated, they’re still incredibly effective in terms of reaching modern audiences.

If a dealership were to invest its entire marketing budget in digital tactics, it likely would generate a ton of awareness and upper-funnel traffic — but it would be at the expense of close rates. As with many things in life, balance should be the goal. Here are three ways dealerships and industry marketers can achieve the right combination of digital and traditional media:

1. Be open-minded when selecting advertising tools.

Modern marketers have no shortage of tools at their disposal, but the latest and greatest technology isn’t guaranteed to cure every marketing challenge. To get customers in the door, use direct mail and email (with coupons). These tactics can help you boost service redemptions, event attendance, or parts sales — and they are relatively inexpensive.

Once customers are inside your dealership, let them know about current specials or future sales events with in-store advertising like window stickers and point-of-purchase signage. Use digital tactics — like paid search — to drive website traffic, reinforce traditional advertising, and find potential customers who you can nurture with email and digital marketing until they're ready to convert via traditional channels.

2. Use intermittent variability to spark action.

Messaging consistency is critical, and you should adopt an always-on media strategy. Deploy direct mail and email on specific days, increasing your digital presence on other days.

While a unified message makes your value proposition easier to understand and recall, it’s OK to use novelty to gain audience attention when the time is right. Establish a quarterly or semiannual calendar and add something fresh every now and then. Not many people answer cold calls, for instance, but personalized outreach via social media or text messages can amplify your regular marketing efforts.

3. Customize your marketing.

Nearly every marketing professional agrees that personalized messages are more effective at moving customers down the sales funnel. On average, 71% of consumers feel frustrated when their buying experiences are impersonal. Don’t waste money on irrelevant messaging — spend time learning about your customers to understand their needs and the channels they use.

Be prepared to shift your budget into better-performing channels, but make sure you understand the causes of any improved performance. Ask your customers what channels drove them to your dealership, and then listen to their feedback carefully! You might even want to consider using reporting platforms to understand the customer journey.

Your customers are unique, and your marketing strategy should be similarly unparalleled. Don’t let industry trends or new technologies distract you from what works. If a certain media mix isn’t getting the job done, be willing to make a change. Ultimately, the tactics you choose should be the ones that enable you to reach your business goals.

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