While many believe vehicle sales are the barometer for automotive success, the blueprint to achieve impactful results is a bit more complicated. For many automotive dealers, it comes down to increasing market share and retaining those individuals once they’ve become customers. But, in an industry largely driven by countless options – makes, models, fuel types, finance options, as well as other features and amenities – it’s a process that’s easier said than done. And it begins with advertising.
In the past, automotive marketers might have delivered advertising campaigns that reached a mass audience but may have only been relevant to a small portion. That means a significant majority of the ad spend was wasted. To put it into context, according to the National Automobile Dealers Association (NADA), in 2017, the average dealer spent $537,000 on advertising and the estimated total dealership advertising expense was just under $10 billion. More importantly, the dealer missed an opportunity to effectively connect with prospective car shoppers and influence purchase behavior.
Suffice it to say, that approach no longer works. Every dollar counts. Automotive marketers need to maximize their advertising budgets and effectively communicate with their intended audiences. But money is only half of the conversation. Relevancy is the other half. People are bombarded with different messages and advertisements daily, so those in the automotive industry need to cut through the noise and have a meaningful conversation with them. But to be relevant, automotive marketers need to understand the prospective car shopper. Therein lies the challenge.
Recent research from the Data & Marketing Association and Winterberry Group shows only 15 percent of businesses can identify their audiences accurately and consistently. Too many automotive dealers rely solely on the data in their own CRM system, or “first-party data”. While there is inherent value, this first-party data is somewhat limited. It only provides a glimpse into a dealer’s customer base. Sure, it may help them better understand how to keep the customer for the long-run (an extremely vital component to their business strategy), but it doesn’t help a dealer increase market share. Dealers can be far more effective reaching in-the-market customers by implementing a sound identity resolution strategy. The combination of first-party data with quality offline and online attributes helps dealers achieve the elusive 360-degree customer view.
For example, an automotive marketer may know a prospective shopper’s previous vehicle purchase, as well as if it was a loan or lease, but with the added intelligence of third-party information, they will understand demographics, purchasing habits and lifestyle behaviors, such as if the individual enjoys outdoor activities or takes their kids to sporting events. Add that to the ability to identify live events that may indicate the likelihood of a consumer to be in-market for a vehicle. That way the dealer can implement a campaign that will resonate with the car shopper, and feature incentives that may convince them to defect to their brand and stay for a lifetime.
But resolving the identity goes beyond an understanding of who that individual is. It gives insight into the types of devices the individual uses, as well as what media channels the person prefers. And in an environment where consumers engage brands and consume information through a variety of channels, it’s important for automotive marketers to implement true cross-channel strategies, whether it’s TV, email, direct mail, etc. For all brands, it’s about reaching the customer, at the right time, through the right channel.
Simply put, a siloed approach is no longer a recipe for success. More than communicating across multiple channels, identity resolution helps dealers measure collective campaign performance. Rather than assessing email or TV ad performance individually, understanding how an individual engages with content enables brands to adjust messaging and creative in real-time to maximize effectiveness.
In order to boost sales, automotive marketers need to connect with consumers at a human-level. Identity resolution is the most efficient means to achieve that objective. The more relevant conversation a dealer can have with a prospective car shopper, the more likely they can influence an individual’s purchasing decision. The data exists to them make the right decisions, better connect with car shoppers and ultimately drive business forward.
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