Use Digital Disruption in Automotive to Your Advantage

Last year was the year of digital disruption in the automotive industry, with innovations in technology forcing dealers to rethink the way they sell.

Tech-savvy shoppers now are able to reach the auto world through social media and online search, meaning they arrive at dealerships already having conducted extensive research and knowing exactly what car they want to buy.

With technology changing the way consumers shop for cars, how can dealerships ensure they are getting in front of the right customers?

Our team recently surveyed hundreds of automotive dealers and a dozen OEMs to answer that question. The findings from our 2017 Automotive Digital Marketing Intelligence Report reveal multichannel marketing strategies are essential for driving high-intent shoppers to a showroom.

Here are some of the findings on how dealers can increase sales using digital marketing strategies.

Social-Media Advertising Drives Conversions

Dealers understand the importance of catching consumers’ eyes via Google and Bing. According to the survey data, they currently invest $5,000 or more each month on search-engine marketing (SEM) to ensure they’re found by prospective buyers.

However, when compared with the incremental impact on SEM performance that included digital video and Facebook advertising, the data showed dealers investing in multiple channels captured 37% more conversions than those investing in search marketing alone.

Social-media advertising is a powerful tool for driving shoppers to the showroom floor. Dealers who invested in both Facebook advertising alongside SEM saw conversions increase 5% and search impressions increase 77%.

If a dealership isn’t taking advantage of social-media advertising, it’s leaving a huge window open for competitors to slip in. However, if it’s deliberate about its social-media and digital-marketing strategy, it will be the first horse in the race.

Video Part of Marketing Mix

With any multichannel marketing strategy, it is imperative to have video as part of the mix. Dealers who ran digital video ads in conjunction with search-engine marketing saw conversions increase 37% and click-through rates improve 26%. Video advertising offers a visual platform to deliver tailored messages about what makes a particular dealership the best choice, and this channel is crucial to the future success of dealers.

Multichannel Campaigns Reduce Costs

The report also showed multichannel campaigns reduce costs. Dealerships in this study lowered their cost per acquisition (CPA) by investing in SEM in conjunction with at least one display channel: banner ads, retargeting, digital video or Facebook.

By using this multichannel approach, 61% paid $30 or less per website conversion in 2016. That’s one-third of the automotive industry average of $90 CPA. Through diversification, dealerships not only are reaching a broader audience, but also are paying less for every set of eyes and ears getting the message.

The survey also found local dealers’ daily budgets are exhausted by 5 p.m., and the social-media presence drops off. Some data suggests the ideal posting times for Facebook and Instagram goes well beyond the workday, which opens the door to giving away customers to the competition.

It is crucial dealers utilize technology that proactively tunes up every campaign to deliver strong visibility as far into the day as possible for any given investment. The right digital marketing solution can ensure visibility if maximized effectively and across all channels, including search, social media and video advertising.

Gary Galloway is head of products-Automotive at Netsertive.