Every medium except yellow pages is seeing an increase in auto advertising in 2011, with an overall increase of 7.2%, from $21.1 billion in 2010 to $22.6 billion. The largest percentage increase is cinema advertising, up 98%.
The largest dollar increase for Automotive advertising is expected to be online media, which is projected to be up 11%, from $6.6 billion to nearly $7.3 billion. Online dominates nearly one-third of all auto advertisers' budgets and will grow as dealers migrate more toward social media and mobile marketing.
Dealers are earmarking 32% of their ad budgets for interactive media this year, more than they spend on any other medium, says the report. These dollars are going principally to banner advertisements and paid search, with additional non-advertising expenditures for website design, inventory database management, lead-generation fees and search engine optimization.
The efficiency of the Internet is not the main reason advertising channels have changed. An average of 86 new and used-car dealerships have closed every week in the past four years, or 17,000 fewer advertisers, with a few thousand more expected this year. And, the biggest advertisers, mega-dealerships created during the consolidations in the 1980s and 1990s, have been hit hardest. In addition, a new phenomenon in the marketplace is that slightly-used cars are in higher demand than many new cars.
Last year the total number of new vehicles sold rebounded to 11.6 million after four years of steep decline. They are projected to hit 12.6 million this year, an 8.6% increase, with a projected increase to $22.6 billion this year for new- and used-car automotive advertising.
Ongoing surveys of local advertisers indicate a continued high interest in online media. Auto dealers are proving to be the most aggressive of all advertisers when it comes to social media and mobile media, concludes the report. 36% of them claim to be familiar with mobile advertising opportunities, twice the rate of other local advertisers.
Auto Industry Ad Spending, 2009-2011 ($ Millions)
10-11 % Chg
Source: Borrell Associates, June 2011
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