• eMarketer, Thursday, February 16, 2006 11:32 AM

Auto marketers are finally discovering the power of the Internet. Even though the auto industry is the single largest advertiser in the nation, spending more than $11 billion in 2005, online advertising among the top 10 manufacturers accounted for just 2.5 percent of their total ad budget. That's despite statistics that show almost 70 percent of consumers use the Internet at some point in researching an automotive purchase. The situation is changing, according to eMarketer, whose new survey projects that automotive advertisers will spend close to $2.7 billion on Internet advertising in 2007. "The industry's foot is definitely coming off the brakes and onto the accelerator this year," says Lisa Phillips, eMarketer senior analyst. "Automotive advertisers are gearing up for an online advertising surge, but it's going to come at the expense of other media." She also said prospective car buyers who go online usually visit a search engine first, then delve into manufacturer, third-party and dealership sites in no particular order or timetable. "The Internet has turned the idea of an orderly buying process, or 'funnel,' into ancient history and the auto industry has to find ways to react," she said.

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