Mining auto ad dollars in an unprecedented market

Traditional media’s value to dealerships is still an opportunity to present ad messages that differentiate a dealership from its competitors. Humanizing the message and emphasizing why consumers should buy from the dealer will stimulate the market.”

Pat Norris, senior vice president of revenue initiatives, JDA Media

The auto industry and its dealers face many challenges. Although consumer demand remains robust, a continuing microchip shortage and many supply chain issues have resulted in very limited dealership inventory. All caused the average dealership advertising per new vehicle to plummet from $640 for 2020 to $541 for 2021.

Nonetheless, there are auto ad dollars available to the media salespeople and ad agencies with a better understanding of today’s market and where it is headed. Mike Blinder, publisher of Editor & Publisher, and his guests discussed this opportunity during an Editor & Publisher January 2022 vodcast. They offered insights about how to reap more of those ad dollars.

Jim Brown, president of Borrell Associates, presented detailed information from the company’s recently released 2022 Local Automotive Advertising Outlook. It revealed how auto dealers’ ad spending has shifted as they try to compete in this unprecedented market.

In traditional media, Borrell forecasts auto ad spending for newspapers will increase 11.9% for 2022, the largest increase since 2016, but will decrease by 18.2% for 2023.

“Our 2022 forecast is based on the many dealers who have pivoted to print media, primarily to obtain more used cars for their inventory,” said Brown. “Although this is a short-term priority, dealers can use their pitch to buy used cars to emphasize the value of visiting the dealership to have that vehicle serviced and to engage on a personal level with those customers.”

Pat Norris, senior vice president of revenue initiatives at JDA Media, had a similar message.

He acknowledged that digital media is important to dealerships, but it leaves the entire shopping experience in consumers' hands; they decide what to buy and where and with little dealership interaction.

“Traditional media’s value to dealerships is still an opportunity to present ad messages that differentiate a dealership from its competitors,” said Norris. “Humanizing the message and emphasizing why consumers should buy from the dealer will stimulate the market.”

Richard E. Brown, head of digital subscriber churn for Gannett/USA Today and an Editor & Publisher contributor, agreed with Brown and Norris that humanized messages still resonant with consumers because they appeal to their emotions. Consumers want to know that the dealer understands them and their buying habits and that the dealership is always prepared to help them with their transportation needs.

He added that building trust with the market isn’t easily conveyed in the digital channel. Still, when dealers use digital media, it must be at a granular level because consumers are very detailed when searching for and selecting a vehicle.

“Consumers don’t always remember what a dealer says, but they do remember how the dealer made them feel in the moment,” said Brown. “That emotional connection will compel consumers to remember what makes the dealer different, and they will find those values appealing.”

All the panelists agreed that the current situation in the auto market is temporary. Inventories are unlikely to return to “normal” levels until the latter half of 2022. Media salespeople and ad agencies must adjust to the unique conditions today. They must also prepare for electric vehicles (EVs) — the next great shift in the auto market. All major automakers will be introducing several new EV models during 2022 and subsequent years, requiring a different set of humanized ad messages to gain a maximum share of the EV market.

Bob Sillick has held many senior positions and served a myriad of clients during his 47 years in marketing and advertising. He has been a freelance/contract content researcher, writer, editor and manager since 2010.  He can be reached at bobsillick@gmail.com.