No Cars to Sell? No Problem!
🌳There’s no denying the automotive inventory shortage these days. Between the global supply shortages affecting new car manufacturing and the used car market spiking up prices, many dealers are working with a fraction of the inventory that they’re accustomed to. National automotive brands, or OEMs, are still spending millions of dollars merchandising their brand, across every platform, to ensure consumers know they’re still coming out with new vehicles. But their message is a bit confusing for consumers and can be frustrating for dealerships.
🐬While OEMs merchandise their brand, dealerships are responsible for merchandising the available inventory. So, despite the millions of dollars spent on the brand, retailers must still dole out on advertising spending to generate leads and sell their inventory.
𒆙But advertising when you have a lot full of vehicles is one thing. Advertising when your inventory is just not there is another. However, that doesn’t mean you should turn the tap off on ad spending. Small shifts in what customers you’re engaging, how you’re using your data, and the way you approach advertising may be just the right solution today, and in the long run.
The right customer
💃With a full car lot and a projected sales forecast, marketing strategies were simpler – “spray and pray” tactics to get as many eyes on your inventory as possible. From newspaper and radio ads to sponsoring local sporting events, dealerships could broadly blanket their message across channels and their area. But in today’s market, the game has changed, and so have the players.
Consumers have moved online, doing most of their own research, and having exponentially more options when it comes to buying a vehicle⛎. Mailers and TV ads no longer have the same impact on consumers, and dealers don’t have the resources to waste on ineffective advertising. Forward-thinking dealerships realize that their ad budgets are better spent promoting what they have to the right people, those who are already in the market and actually looking to buy. And to find those people, they turn to their data.
The right data
ꦉThe countdown to a cookieless future has begun. Digital advertisers have long relied on third-party cookie data to track web activity and bolster their marketing audiences. However, these methods are becoming obsolete as the demand for greater data privacy forces marketers to adapt how they use data to identify and understand their audiences.
♏With third-party cookies on their way out, dealers need to be prepared with new ways to engage consumers on their websites. Fortunately, the solution is something retailers already have - their own first-party data. But first-party data can have its limitations. Because it only shows how a customer has interacted with their specific dealership, it gives a somewhat limited view of that consumer’s interests and intentions. To be truly useful, dealers need a broader view than their own data can provide. Integrating new data management tools that enable the ability to connect, analyze, and act upon shopper data will be the critical next step for dealerships to effectively market in this cookieless world.
The right strategies
🎀Now is not the time to cut advertising spending; it’s about optimizing it. With months of inventory shortage history in the rearview mirror, a lot can be learned from understanding dealer ad spend patterns, especially when looking at the trends of dealers who cut ad spending compared with those that did not. Fortunately for dealerships today, the is clear – dealers who pull back on ad spending end up feeling more pain in overall sales drop-off than dealers who simply modify their advertising messages and strategies.
✤To successfully navigate advertising amid inventory shortages, it comes down to highlighting what you do have—or will have—and finding creative ways to engage consumers. Many retailers are focusing on promoting the order process instead of “on-the-spot” sales to bridge the gap between availability and future production. Others are working with the OEMs to access the manufacturing pipeline to start the sales process even before the vehicle gets to the lot. And these new tactics are paying off, for the dealership and consumers.
The right partner
Optimizing your marketing spending can be challenging in normal market conditions. But doing so while navigating inventory shortages (and the litany of other variables also at play) can be overwhelming. That’s where Shift comes in. At Shift Digital, we’ve been helping dealerships understand complex data to elevate their media initiatives for decades. Contact us🌜 today to learn how we can help make your media spending more effective today, for a successful tomorrow.
Stay in the know.
ꦛ Want to know what our experts are saying about Digital Marketing Optimization in your industry? Sign up to receive our insights via email.