How do you effectively market in a multi-billion dollar media category where most of your customers talk and influence others behind your back?
This is the automotive industry's new reality. The Internet is inseparable from the purchase cycle, and nearly 75 percent of consumers cite word-of-mouth recommendations as the most influential factor in their car buying discussion. Put another way, well North of $300 billion in global auto sales are influenced by the recommendations of others.
This is a far cry from my father's advertising world, and I mean that literally.
While I grew up in Southern California, I was born in Detroit. At the time my father, Bill Blackshaw, was a BBDO executive handling advertising for the Dodge Dealers Advertising Association. Dad later joined L.A.-based firm Eisaman, Johns & Laws, working with Chevrolet dealer associations in Midwest and West Coast markets. Shortly before he retired, he spearheaded advertising for the Mercedes Benz Dealers of Southern California.
Needless to say, I grew up on auto jingles, copy reels, commercial shoots, and the splendid spoils of agency relationship-building (like dugout seats at Dodger stadium).
Dad Reflects On Dodge Boys, Dealers, and Booting Lawrence Welk
The ad world my father stepped into after World War II catered to an increasingly prosperous mass audience. Relatively straightforward blends of print, radio, outdoor and particularly TV, achieved most client objectives. Media was far less fragmented, and messaging was much simpler. "We could satisfy our reach objectives for print with only three magazines: Life, Look, and the Saturday Evening Post," he recalls.
Much of the complexity Dad experienced revolved around managing dealer and manufacturer relationships, a tension one still feels when visiting auto brand Web sites. "This was not an easy task, and dealers often questioned the factory's moves," Dad remembers. "Dealers were outraged when Dodge, seeking to penetrate a younger market for its cars and trucks, fired Lawrence Welk, who was highly popular with older truck buyers."
The term "word-of-mouth" wasn't in vogue, but its impact was certainly recognized. "Dealers would often scrutinize agency programs based on their ability to create so-called 'conversational pass-along' in order to get folks to walk through the door," says Dad. Programs like the successful "Dodge Boys" campaign were designed to create talk-value!
Son Projects Auto Buyers To Take the Wheel
So Dad, what's the biggest change in the marketplace today? "Auto buyers are so much more sophisticated. They have far more choices and 'issues' to manage. They do more homework, ask harder questions, and are generally skeptical of what we say."
As usual, Dad's right on the money. Automakers now face empowered consumers who not only are less responsive to the types of ad campaigns my father's generation perfected, but who increasingly tap into other consumers' knowledge before they buy. It's not that TV car spots are no longer effective, but important new activities now fill the space between the initial ad stimulus and car purchase.
Significantly, auto shoppers increasingly rely on the digital trail of high-impact consumer-generated media (CGM). Just consider:
All this puts a massive premium on listening. The ability to monitor, and even to influence, CGM may represent one of auto manufacturers most important future competitive advantages.
The good news is most automakers are already very mindful of these new realities. Web spending is up significantly, aided in part by better online ad models and the recognition Web sites play a key role in the consumer buying cycle. This year, Daimler-Chrysler boosted Web funding nearly 20 percent. GM made waves (and upgraded its image a bit) with its conversation-centered FastLane blog. I know from first-hand experience working with brands like Ford, Volvo, BMW, Toyota, Nissan, Lexus, and GM that auto players see more value than ever in listening to consumers, what I'll now dub "consumer-casting." Beyond their advertising impact, vocal consumers also act as a superior early warning system on quality and safety issues, and can play a critical role in product development.
Fuel for the Road Ahead
Even so, there are still some big misses. Automakers often treat customer satisfaction and marketing as separate silos. That's a monster mistake. Consumers willing to provide feedback are also the most potent sources of free advertising. Nor does it help that auto players haven't evolved much in how they segment or profile consumers. Far and away the most important question you can ever ask a consumer who touches a brand is whether she tells others. I've reviewed over 100 auto industry customer surveys and feedback forms. Few, if any, attempt to profile respondents for influence. Traditional scorers like JD Power and Associates perpetuate this miss by anchoring their metrics to satisfaction and loyalty, not a propensity to tell others. Groups such as WOMMA are trying to change this mindset.
Automakers must also exploit CGM to drive greater accountability. As I wrote here earlier, agencies in particular should be compensated in part based on CGM outflows. If consumers spray negative CGM in response to an inflated auto ad claim, agencies should be held accountable. The same should apply to product developers, customer service, and suppliers.
Finally, Web sites should really be re-architected to meet the new demands of today's empowered consumer. With or without advertising, they naturally reach for the brand Web site, particularly in high-involvement categories like automotive. Most auto Web sites are over-architected. They lack the agility and flexibility we've come to love in the blog world. Few offer RSS (define) or make it easy to find the TV spots in online formats. Many have search engines that barely hit the desired target. All these factors impact word-of-mouth patterns.
The auto industry is making great progress, but they need to work harder to keep up with the demands of today's consumers. Just ask Dad!
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Pete Blackshaw, whose professional background encompasses public policy, interactive marketing, and brand management, is executive vice president of strategic services for Nielsen Online, a combination of Nielsen BuzzMetrics, a firm Pete helped cofound, and Nielsen//NetRatings. One of Pete's key focuses is helping brands interpret, manage, and act on consumer-generated media (CGM). A former interactive marketing leader at P&G and founder of consumer feedback portal PlanetFeedback.com, Pete cofounded the Word of Mouth Marketing Association (WOMMA). He authors several blogs, including ConsumerGeneratedMedia.com, and is the author of an upcoming book from Random House, "Satisfied Customers Tell Three Friends, Angry Customers Tell 3000: Running a Business in Today's Consumer-Driven World."
December 12, 2013
1:00pm ET / 10:00am PT