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Work Smarter, Not Harder: Understanding the 3 Advertising Tiers and How Vendor Partners Fit the Puzzle

For dealers, the smarter way means bringing in a trusted third party who can prove to you that they are both competent in managing a multifaceted automotive marketing strategy and aware of the need to customize for the local level while still staying OEM compliant.

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One little-discussed aspect of automotive advertising is the delicate balancing act it often takes to coordinate your dealership’s message across the three tiers of advertising: the national, regional and local levels. As if search engine optimization (SEO) and programmatic display campaigns weren’t complicated enough on their own, there’s also the extra wrinkle of fitting everything together at multiple levels to maximize return on investment (ROI).

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Nevertheless, coordinating these levels is essential for a few reasons. First, and perhaps most obviously, each tier of your advertising communicates to a different audience and serves a distinct purpose. If you muddy those waters, you won’t reach as many potential customers as effectively as you should.

A second, less obvious reason is without coordination, there’s the possibility for conflicting or contradicting messaging, or even self-defeating competition between your own ad campaigns. This is especially true if you enlist the help of a vendor partner in your advertising efforts.

However, dealers shouldn’t ignore the value an outside party can bring to automotive advertising — especially if that outside party manages those campaigns for you so you can focus on what matters most for your business: selling cars.

So, how can dealers ensure their vendor partner of choice fits into the advertising puzzle without creating unnecessary headaches or eating into ROI? Fortunately, it doesn’t have to be that hard — it just goes back to having a thorough, working understanding of the three different tiers of advertising as well as the balancing act I mentioned previously.

The 3 Tiers of Automotive Advertising

Before we dig too far into the weeds, let’s do a quick refresher on what the three tiers of automotive advertising actually are, and how they differ:

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  • Tier 1: The National Level. This tier deals with original equipment manufacturer (OEM) advertising on a broad scale, and pushes brand awareness or brand-wide initiatives and campaigns. While this tier doesn’t usually involve dealers directly, its ad content certainly has an impact on tier 3 dealer advertising in the form of OEM compliance and messaging alignment.
  • Tier 2: The Regional Level. This tier deals with advertising at the regional level, reinforcing tier 1 ads while helping drive traffic to local dealers with localized deals available at multiple dealerships in the area. In many ways this can be the trickiest of the tiers to navigate, as OEM and individual dealer concerns meet on everything from ad content to funding.
  • Tier 3: The Local Level. This tier pushes dealer-specific brand awareness, initiatives and campaigns. This advertising is targeted at in-market shoppers as well as your dealership’s existing customer base to promote part sales and vehicle service.

So, a glance at the three advertising tiers should illuminate some of the challenges facing dealers. Finding a balance in tone and content between national campaigns and local ones is not always simple, and getting OEM assistance for funding in tiers 2 and 3 often involves dealers taking advantage of difficult-to-navigate co-op programs. In fact, in 2018 nearly $14 billion of auto manufacturers’ allotted co-op budgets of $36 billion went unspent — about 40% of the “free money” available to participating dealers.1

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Even dealers who do manage to secure co-op dollars hesitate to farm these responsibilities out-of-house to a third-party vendor partner.

So, what should dealers be looking for in a potential advertising partner to fit the puzzle and bring real value to the equation?

How Vendors Fit the Puzzle

Here’s a relevant statistic that should hit home for many dealers: Auto brand loyalty is just below 50%, and it decreases the longer a person owns the car.2 In other words, half of your customers won’t even consider the same brand when buying their next vehicle.

Why does this matter? Because OEM marketing programs rely on brand loyalty. For dealers who are trying to hew closely to the OEM marketing line to ensure compliance and co-op funding, it can come at the expense of local business by diluting the individual dealership brand.

That’s where the concept of messaging balance comes in, and it’s also where a knowledgeable vendor partner best fits into your overall advertising strategy. Your marketing should be personalized to your goals and help you stand out in a crowded market — while still following manufacturer guidelines.

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That, in a nutshell, is the critical litmus test for a potential vendor partner, at least in terms of coordinating messaging across the three tiers: Can they provide customized dealership marketing strategies that still meet OEM compliance standards, ultimately saving the dealer money?

In other words, can they craft your message with your branding and convey it consistently across all channels?

The primary benefit of partnering with the right vendor, of course, is that you not only maximize the potential impact of your advertising but also minimize the potential cost — an all-around more profitable way of doing business.

The secondary benefit is that you hand off responsibilities that drain a significant amount of time and resources to a competent entity who will manage the gritty details for you. That allows you to redirect that time and those resources to more directly profitable ends: selling cars and service.

It’s also worth noting that vendors can bring resources to the table that simply aren’t easily accessible or available to dealers alone. Rather than relying on the “broadcast messaging” of tiers 1 and 2, consider the impact of being able to target at a highly personalized level for tier 3 advertising — something vendors make possible with unique access to market and demographic info and resources dedicated to generating actionable insights from customer data.

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Working Smarter

There’s a universal saying that, when faced with a new challenge or difficult task, it pays to “work smarter, not harder.” This concept applies perfectly to managing the delicate balance of aligning cross-tier messaging and securing the most possible in co-op money.

For dealers, the smarter way means bringing in a trusted third party who can prove to you that they are both competent in managing a multifaceted automotive marketing strategy and aware of the need to customize for the local level while still staying OEM compliant.

Find the vendor partner who can do that, and you’ll have found the perfect piece to complete your automotive advertising puzzle.

1 Netsertive
2 Automotive News

Chris Walsh – Naked Lime Marketing

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