The study suggest that online spending should be about 10% to 15% of the overall media mix in low-involvement categories such as package goods and that the best interactive marketing is an emotion-packed complement to offline media. The research also suggests that rebalancing online and offline media levels may offer a better return on investment.
Although the studies involved campaigns for Kleenex and toothpaste brands there is a lesson here for auto makers. Increasingly the auto industry is grasping that for most consumers, the FIRST step in car buying is online research.
J.D. Powers and Associates reported in October that an estimated 82%of new-vehicle buyers visited third-party automotive sites in 2002, while 76% visited a manufacturer Web site and 48% visited dealer sites. Further, of the 60% of new-vehicle buyers who use the Internet for shopping, 88% visit automotive Web sites before arriving at a dealership for a test drive.
The growth of eBay’s used car business aside, motorists are not buying cars online in great numbers, but they are doing their homework there especially comparing model features and pricing. While some are tire kickers, the vast majority of visitors to automotive sites are in the market to make a purchase.
If auto maker media mixes are rebalanced as suggested by the IAB, the most impactful move would be into increase spending on the web, on major automotive information site where buyers are in the process of narrowing their choices. Today there are even tools that allow auto makers to present consumers a third option when doing a side by side comparison of two other, similar models.
Clearly there is merit in the IAB report. Already this year General Motors announced a reallocation of dollars from their TV and print advertising budgets to “grass roots” and “relationship” areas such as the Internet, sponsorships and direct mail. Who knows, after a little experimenting they may come to the same conclusion as Amazon which last week decided to throw in the towel on its TV spots. The $50 million Amazon spent last year on local market TV apparently did not deliver much of an ROI.
No one (least of all me) is suggesting that TV doesn’t work for automakers. But the evidence is mounting that even a slight shirt to where the in marketer buyers are – online – can pay big dividends.
Mitch Lowe is the CEO of Jumpstart Digital Marketing, an interactive marketing and media sales organization that focuses exclusively on the automotive industry. Lowe can be reached at mitch@jumpstartDM.com.