During my career, I’ve represented well-known brands at ad agencies and media organizations, and I never fully understood why companies continue to sink significant budget into traditional marketing. At its core, traditional media is way too expensive and extremely difficult to track — not to mention growing out of favor with consumers.
For example, total weekday circulations for newspapers fell 8 percent last year for both print and digital, and last year’s newspaper revenue was a third of what it was just 10 years ago — 2016 marked the 28th consecutive year of declines. Traditional TV viewing has declined over the past five years by an average of nearly 21 percent across all age groups, excluding adults aged 65 and older. Radio is about the only medium that hasn’t suffered heavy losses, although Millennials prefer streaming radio over traditional radio.
I’m not a person who strictly believes that if it isn’t digital, it won’t work — there are exceptions to every rule. But we now live in a world where a majority of consumers spend a majority of their time online and that’s where smart marketers, and their budgets, should be as well. This is especially true given the fact studies show it costs approximately $150 of digital marketing to sell one car compared to $1,581 — more than 10 times — in traditional media spending.
Following are tips for dealers and for the agencies that represent facets of their business. I call it the “80/Supplemental-20 Rule” and here are some fundamentals.
Let Your Brand Do the Heavy Lifting
OEMs spend a ton of money (just look at the Super Bowl) to build your brand in the traditional sense. They are well equipped to run national TV spots, take on full-page, four-color ads in major media outlets or national radio campaigns promoting sweet sales events. They have tools and teams of people at their access to help strategize, create, plan, implement and track brand campaigns on a national scope, bolstering your efforts on a local level. So, let your brand do the heavy lifting.
Commit 80 Percent to Digital, 20 Percent to Targeted Traditional Campaigns
Commit the bulk of your annual marketing budget, about 80 percent, to digital and third-party leads. When done right, it’s affordable, effective, easy to measure and helps you reach local customers beyond your efforts right where, and when, you want them — online, while they’re researching their next vehicle purchase. Dedicate roughly 20 percent of your annual marketing budget to strategic traditional campaigns, such as sports broadcasts (where local viewers tune in live at the same time) or ever-popular live and local news broadcasts. Lulls in regional dealer association advertising campaigns are opportune times.
Remember that Digital Companies Invest Heavily in Driving Consumers to You
It’s really that simple. An effective digital lead-generation company, for example, will spend virtually no money building its brand, and instead will devote a significant budget in expert SEM to reach and convert millions of monthly car shoppers into dealer Website traffic and leads so you don’t have to. This is particularly critical in sales declines when conquesting products help you reach and engage competitive consumers to drive them to your Website. After this much wider net is cast on your behalf, be sure to invest in digital tools that convert Website visitors into showroom visitors. Products like virtual showrooms, text lead management systems, shop-by-payment calculators and instant retargeting technology have proven to be very useful tools in Website optimization and conversions.
Let’s stop the debate and be honest with ourselves. A majority of today’s car buyers are online and you should be there too — the right way, and for a lot less money.