State Of Marketing: BC Auto Industry

A survey by the Automotive Retailers Association (ARA) and Google Partner Agency Marwick Internet Marketing entitled ARA Marketing Into 2017 – Researching The Shift In Marketing Trends compared the marketing efforts of six automotive sectors (towing, licensed motor dealers, collision, mechanical, auto glass and auto recycling) and found that almost two-thirds (61%) of respondents will be focussing their marketing efforts on traditional marketing over digital marketing during 2017/2018.

While half the respondents say they will be spending around the same on magazines, newspapers radio and TV, almost one-third say they will be spending “much less” on those traditional channels. The focus on digital channels such as website development, social media and in particular organic search engine optimization will be receiving an increasing portion of the marketing budget as part of the marketing efforts of the auto sector over the next few years. However, social media (including Facebook, Twitter, Instagram and Snap Chat) are not considered to be a top priority for many in the sector. More than half of the respondents are displeased with their current online marketing efforts, while more than two-thirds believe that online reviews were important or critical to their business.

ABOUT THE SURVEY

The analysis in this report is based on an online survey conducted from September 2016 to November 2016 among a sample of 100 business owners in the automotive industry (towing, licensed motor dealers, collision, mechanical, auto glass and auto recycling) across British Columbia, Canada, who have a turnover of $0 to $5 million+. The survey was conducted by Automotive Retailers Association (ARA) in partnership with Google Partner Agency Marwick Internet Marketing. Some figures have been rounded up or down to the nearest decimal point.

ANALYTICAL OVERVIEW

Automotive companies in B.C., Canada using traditional marketing methods could be losing out on potential sales as customers increasingly turn to digital, mobile and social channels to find local services, according to the latest research.

Trends compared the marketing efforts of six automotive sectors (towing, licensed motor dealers, collision, mechanical, auto glass and auto recycling) and found that almost two-thirds (61%) of respondents will be focussing their marketing efforts on traditional marketing over digital marketing during 2017/2018.

With the internet becoming the primary source for consumers searching for local business information (four in five consumers use search engines to find local information), the survey’s findings could mean many automotive companies are failing to keep pace with customers’ buying behaviors.

To gain a greater understanding of where their marketing dollars are going, respondents were asked which particular areas they anticipated spending their money. The responses were split with just over half saying they would be spending “the same” or “a little more” over the next few years on traditional forms including newspapers, TV, radio, flyers and magazines.

These results are rather surprising as print readership has fallen by a staggering 25% in just the last four years and the online audience for newspapers continues to shift to mobile devices as mobile traffic outpaces desktop traffic.

The 13th annual Pew Research State of the News Media Report found that newspapers lagged behind local TV news (46%), cable TV news (31%), network evening news (30%), news websites (28%) and radio (25), when it came to public sources for information.

While around half of the respondents to the ARA/Marwick survey said that they would be spending about the same on magazines (50% of respondents), TV (57% of respondents) and radio (61% of respondents), around a third said they would be considering spending much less. One-fifth of respondents said they would be spending much less on newspapers.

When it came to the budget allocated for digital marketing, the tone was mixed, with companies understanding a need to build their online presence but feeling unsure when it came to the advantages of social media. With latest figures suggesting there are 2.34 billion social network users worldwide (Facebook has 1.71 billion active users and Twitter has 313 million monthly active users for example), not using targeted advertising on these channels and engaging in social networks could mean businesses miss out on driving targeted traffic to your website and boosting your website’s SEO.

Moving forward, respondents reported that having a mobile responsive website (84%), organic search engine optimization (81%), and Google Ads including S.E.M. or pay-per- click (58%) were the top three areas of importance.

Of those respondents, 5% said that having a mobile responsive website was “not important at all” to their business, while 3% said the same of organic SEO and 10% for Google Adwords. These respondents could be falling behind. Last year, Google announced an algorithm change that meant sites with a mobile-friendly experience receive better rankings. With search still the leading referrer to most websites, not using organic SEO and specific Google AdWords could put businesses at risk of not reaching potential customers that are specifically searching for the product/service they offer.

Respondents were generally on the fence when it came to the importance of Facebook, Twitter, Instagram and Craigslist to their business, however, almost half the respondents said that Pinterest and Snap Chat were “not important at all” (43% and 47% respectively).

While the overall findings showed some hesitance to social media marketing, Pew Research Center recently reported that 90% of young adults use social media, compared with 12% in 2005. This leads us to believe that the automotive industry could be missing out on marketing to Millennials, who have now surpassed Generation X in new-car purchases and therefore in search of automotive needs.

Increasing the focus on social media would result in greater brand awareness to a younger generation and ensure business longevity.

In addition, according to Pinterest, Pinners are just as likely to purchase as users from other social channels but spend 50% more on average compared to other social channels. They also spend 20% more than users referred from non-social channels.

Other key findings of the study include:

•More than half (56%) said remarketing efforts were important to their business, however, almost 18% of respondents were unsure.

•12% of respondents admitted their company was “terrible” at utilizing online marketing.

•More than two-thirds of respondents (70%) said that they did not know the conversion rate of their website.

•When it comes to blogging, 63% said they would be spending more, while a quarter (25.8%) said they would be spending “less” or “far less.”

Of particular note was the opinions of online reviews, with respondents having a very favorable view:

55% cited them as important for their business and 27% said they were “critical.” Only 18% said they were “not particularly important.” This thinking is in line with a number of recent studies that state that around 90% of consumers today read online reviews before visiting a business, and 88% of consumers trust online reviews as much as personal recommendations. Online reviews also have the added benefit of affecting your rankings in local search engines, making it an essential part of a local SEO strategy.

With personalization being essential to the automotive sector, the research shows that small businesses that are savvy about the potential of the internet could well benefit from shifting their focus to online channels and building awareness across all generations. Those that are slower to adapt and spend time and money on more traditional forms may find they are losing businesses to online competitors.