Drawing on a new white paper, the Eckstein, Summers sales consultant says the the auto business has experienced 50 years of change in the past five. Smart broadcasters must understand that change and work with local auto dealers in developing new marketing strategies and tactics. That’s the way to keep car sales — and advertising sales — growing after the last clunker has left for the junkyard.
It actually happened.
The Cash for Clunkers program left car lots empty. This has impacted your local dealers because while the supply of many car models is dwindling, consumer demand is slowly creeping upward.
We are sure that TV station sales managers are ready for local car dealers to return to broadcast television, but the question is whether account executives are.
This fall, and certainly in 2010, when auto sales are expected to rise 15 percent, account execs will need to know where the auto sales industry is headed, how to help a dealership recover lost ground, how to design an effective TV/Web campaign, how to work with mega-dealers and, finally, how to help dealers measure the effectiveness of their campaigns.
According to a new white paper just released by my firm and available for the asking, broadcasters need to recognize that the auto sales business is becoming more sophisticated. The new breed of dealership owners will be large investing groups, often with multiple franchises, a deep management structure and numerous sources of capital. Gone will be the small “country dealers.”
Dealers will evolve from simply being sales distribution points for nameplates to being true retailers. Their marketing will become more tactical and less promotional.
Fewer dealers will handle more nameplates. Auto service centers will expand rapidly and require separate and distinct marketing efforts.
Consumers are also changing. Coming out of the recession, buyers will demand more upfront value and be more mobile. They are not only comfortable buying across town; they are comfortable buying across state lines.
Broadcasters can help dealers recover lost ground by convincing them to adopt the skill sets of advanced retail marketers.
Stations should encourage dealers to make annual rather than quarterly buys by demonstrating the efficiencies of long-term planning and to reduce daypart count and double-spot in lower CPM areas like local news and syndication. Such a plan will improve the return on investment, while still yielding necessary reach and frequency.
Broadcasters should also remind dealers that in tough times they can grow market share on the cheap by staying in the advertising game, while competitors are pulling back or pulling out.
To deal with the new breed of mega-dealers, account executives first have to identify the true marketing decision makers. Once that’s done, they should convince them to avoid using one “branding” spot for all the dealerships. Each needs a specific message.
Auto dealers have already figured out that the simple customer survey is no longer good enough for determining why customers visit a showroom and buy a car.
In place of the surveys, dealers should use a variety of more telling metrics during ad flights, including traffic on their own Web sites and click-through rates on their ads on station sites. They should also monitor closing ratios and gross sales.
This week, I shared some of this thinking with the general manager a high-volume Honda dealership in the mid-south. He thoroughly understood our philosophy, saw the big picture of where his business is headed, and said he wants to get a campaign on the air by Labor Day.
We agreed that auto television advertising in 2010 would not resemble current TV commercials. We also agreed that the advertising will be much more tactical, more like a retailer, then just the usual sales promotion for the weekend.
Hey, you have two choices.
One, use the old TV sales playbook that has us talking about our TV station being the “best” station or launch a winning plan that shatters the old model and helps our newly empowered car dealer friends drive their business to extraordinary heights.
What’s it going to be?
Adam Armbruster is a partner with Eckstein, Summers, Armbruster and Co., a retail and broadcast television consulting firm. He is also the author of Driving Automotive Forward, the white paper upon which this article is drawn. You can get a copy of the paper by clicking here. Armbruster’s associates Dave Eckstein and Roland Eckstein, contributed to article and paper.