DEALERS TO INCREASE ONLINE SPEND IN 2008 ACCORDING TO AUTO TRADER
January 17th, 2008New research* from Auto Trader, the no 1 motoring website and magazine, reveals that dealers are set this year to significantly increase their spend on media more focused on motorists. (*Source: HPI Research, September 2007 – 992 dealer respondents).
This includes dealers’ own websites – and motoring websites like AutoTrader.co.uk and classified motoring magazines. However, dealers will decrease their spend on regional press and radio in 2008.
The budget for dealers’ own websites increased vigorously last year, with an average of 35% extra spent and this year, it is set to rise by nearly a quarter on average (24%). The budget for classified magazines, including Auto Trader, is set to stay the same.
However, significant proportions (two-thirds) of franchised dealers will reduce spend on offline marketing over the next 12 months, with over half (55%) cutting regional press advertising in the last year, as well as TV and radio. In fact, less than 10% of all franchised dealers – and less than 5% of independents – will allocate any budget to radio and TV in 2008.
The main reasons for moving away from regional press and broadcast media are perceptions that online and classified magazines reach more motorists and generate a better response.
According to the HPI Research data, dealers on average last year spent the following on monthly advertising and marketing:
- Large franchised = £6,390
- Small franchised = £4,504
- Large independents = £1,402
- Small independents = £1,394
- Supermarkets = £13,272
For future advertising and marketing budgets, a third of respondents anticipate an increase, although very few envisage large changes. 2008 marketing budgets will remain stable across all dealer segments, with average rises of between 1% and 2% for both franchised and independent dealers.
Though dealers will be spending more online in 2008, there is a strong conviction that the use of both on and off-line media increases reach and enables targeting of different types of customers. Franchised dealers are more likely to use regional print and online advertising in tandem when compared with independent dealers. Over 90% of large franchises use both media, while the proportion falls to just 62% for small independents.
Independent dealers are more likely to have fixed month-on-month marketing budgets. Larger franchised dealer groups appear to be more seasonally influenced (e.g. focusing on new registrations in March and September). Around 1 in 10 dealers have a reactive ‘virtuous circle’ of spend – more sales spur on more advertising.
Other research suggests more work needs to be done by dealers to track leads. According to a recent survey*, over 50% of dealers do not track leads from regional press adverts; 25% don’t from their own websites; 50% fail to from adverts on other websites. Just 25% of dealers know that up to half of their advertising works, with 20% admitting they don’t know how much of their advertising is effective. (*Source: 2nd Byte, October 2007)
Matt Thompson, Marketing Director at Trader Media Group comments: “The Internet is a powerful sales channel and one of the most effective tools for driving leads. However, some dealers could be throwing good money after bad on advertising that doesn’t produce leads. It is essential that all dealers start evaluating which forms of advertising work and which don’t. Media partners too need to work harder with them to ensure they get the best response and return on their marketing investment.
“At Auto Trader, we are committed to helping dealers achieve more profit by selling cars quicker and at the right price. To this end we are planning our biggest ever investment in our brand to attract more motorists and drive an even better response for advertisers, in both the Auto Trader website and magazine. In addition, we have introduced a range of tools with this in mind.”
The Auto Trader tools include:
• Stock Profile Intelligence (SPi) is a unique service that enables car retailers to discover how competitively their used car stock is priced within their local area.
• Calls 2 Account, which tracks leads generated across all advertising channels.
• Auto Trader Advantage, which amongst other developments has added a further 5 million motorists to the audience through new exclusive partnerships with websites like Auto Express, Tiscali and Sky.
- Ends -
Notes to Editor:
• With 13 regional Auto Trader magazines across the UK and the Republic of Ireland, the brand is building a competitive position across all effective channels including print, the web and WAP.
• Auto Trader is owned by Trader Media Group, which also publishes market leading niche titles such as Top Marques, Bike Trader, Truck & Plant Trader, Ad Trader, Motorhome and Caravan Trader, Farmers Trader, Auto Freeway, TNT magazine – all with the largest reach in their sectors, through magazine readership and web visitors.
• Trader Media Group publishes over 70 titles every week with a combined circulation of 1.5 million and has leading websites for its top titles.
• Trader Media Group, a division of Guardian Media Group, employs over 3,900 people across 40 locations in the UK, Ireland, Holland, Italy and South Africa. The Group is looking to expand on its winning formula - developing a one-stop-shop for motorists; giving trade customers the opportunity to choose all effective channels to market; building the service and relationship with dealers and manufacturers; and strengthening its portfolio of automotive and specialist classified titles.
For further information, please contact:
Karen Hughes/Caroline Burnell
The Drum Consultancy
Tel: 020 7025 8044
Fax: 020 7025 8100
Email: karenh@drumbeat.co.uk
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