December 2012, Auto Dealer Today - WebXclusive
A study by Autotrader.com and Morpace, Inc. - a global market research company - conducted earlier this year highlights that 93 percent of used car buyers and 86 percent of new car buyers do not use Facebook to shop for a vehicle. The study entitled “2012 Digital Shopping Dynamics Study” states in its overview: “While the social media phenomenon is still relatively new, it is important to examine and understand how consumers use it in order to establish a baseline for measuring its impact on new and used shoppers over time and as the market matures.” Unfortunately, this study doesn’t begin to do what it states in truly understanding how consumers use social media throughout their purchasing cycle.
The traditional sales funnel travels from brand awareness to brand perception, giving consideration to intent to purchase, the sale, to loyalty and advocacy. Each portion is a valuable area upon which to focus marketing efforts. The digital shopping dynamics study focuses all of its efforts on intent to purchase and the sale itself. What this study fails to uncover is the influence of (Facebook) friends' sentiments about vehicles and dealers. Facebook may not be the research hub, but in this user-generated-content era, it can be, and often is, the filter to what your next customer is researching.
The marketing landscape is changing. Traditional media is being adjusted to accommodate the consumer. As an example, Dish Network recently announced it would offer viewers a chance to “auto-hop” through commercials that were recorded on their DVR. What that should say to brands advertising in the traditional space is that there are even fewer guarantees that your ads will be seen. If you are unable to get guaranteed impressions because consumers simply aren’t there, then what is the most powerful form of marketing you can harness? The place they are, social media.
In a recent Radio Sales Today article, Facebook’s manager of global marketing solutions, Doug Simpson, said, “Engaging loyal customers leads to word-of-mouth awareness and recommendation that other forms of advertising cannot buy.” This means that prospective shoppers are listening to their social networks before they get to purchase intent. If peers are bashing a brand or dealer, the consumer will drop the vehicle or dealer from their consideration set and there is little reason for them to research that brand or dealer. On the contrary, if peers are raving about how well a dealer handled their sale, your business may slip into the consideration set. The research will likely be done on your website, but the reason to research is attributed to influence by peers.
Social media as a whole has many other channels where consumers choose to research their cars. If the aforementioned study aims at understanding how consumers use various social media channels, it cannot just limit research to Facebook, Twitter and YouTube, as noted in the survey questions. Sites such as DealerRater or Cars.com are great avenues for social research, where both qualitative endorsements and quantitative scales help consumers determine if they should go out of their way to shop at your dealership.
It is important to delve into the motivation behind the research rather than take the statistics at face value. Dealers are becoming more savvy marketers and are beginning to understand the value of social media. A realization of such nature requires the dealership to either spread marketing dollars or reallocate budget toward new media. As a third-party portal, Autotrader.com and many similar sites are seeing the advertising dollar go to the next hot-ticket item. The findings implore dealers to reconsider (at least) their Facebook budget allocation.
In reality, investing in social media marketing can be useful to any dealership. While your customer may not actually be researching for their next vehicle via social channels, they are determining what to research and from whom to buy. Dealers need to consider at what level of the sales funnel customers are exiting and activate and advertise against it accordingly.
If awareness is your issue, figure out what channels are best for you to broadcast on. If perception is your problem, look at your creative or develop an experiential activation that gets the product in front of targeted consumers. Consideration and advocacy of the dealership are two great places where utilizing Facebook and other social media channels makes sense. And if it is the actual purchase that is lacking, utilize dealer incentives and promote on third-party sites like Autotrader.com.
Modern business has undergone a fundamental shift. The gathering marketplace is the largest it’s ever been, and everyone has a massive and influential bullhorn. Customers aren’t going to the digital public square to purchase a car, but they are going to hear what others are purchasing, where they are purchasing and why. Most marketing and advertising is all about promises being made to the customer. You can become the dealer from which people want to buy their next automobile by fulfilling those promises and amplifying through peer networks and social media.
Vol. 9, Issue 9