Innovation drives everything we do at MHP/Team SI. A big piece of innovation is having our pulse on trends to predict and invent what the next big thing may be. We’re bringing you along for the ride, as our resident experts make their 2023 marketing predictions.
In the below video, you can learn from the experience of Tanner Ward, the Vice President of SI Auto. We launched SI Auto last year to better focus on the needs of our automotive clients, which are some of our long-lasting relationships at the agency. Tanner has done an excellent job leading this division and pushing it forward to meet the needs of its clients in innovative ways.
Grab your coffee, sit back and enjoy the interview! If you’re pressed for time or want a quick overview, we’ve provided that below.
Challenges in the Automotive Industry
It’s no secret that the last few years have thrown some curveballs at the auto industry. Yet, these challenges have allowed dealers and those who market for them (ahem, us) to innovate and continue putting customers in vehicles.
The first challenge was manufacturing. Even before the Covid pandemic, some manufacturers experienced worker strikes. Then, the pandemic came and factories shut down. Even after auto factories came back, a pandemic-related semiconductor chip shortage further delayed vehicle production. These problems on top of shipping issues snowballed from a supply chain slump into a slumber for the automotive industry.
While the tides do finally appear to be shifting for the better, it will be a slow process. Many are now expecting a return to something resembling normalcy and regularity by the end of 2023.
A second challenge came about in the second half of 2022 that probably won’t be going away as easily: higher interest rates. Even customers with good credit scores are facing rates up to 9 or 10 percent lately. On top of the supply issues, this has meant higher prices and, therefore, fewer customers for many of our car dealer clients.
Meeting the Challenge with a Customer-First Approach
We’ve found the best way to confront problems like this is to take a customer-first approach. By tailoring our ad campaigns both to the supply of the dealer and the wants of the consumer, we’ve been able to help our clients make sales and meet quotas. Dynamic and personalized advertising have been key in how we go about this.
We often say here that “auto drives innovation,” because automotive marketing is usually on the cutting edge of marketing. But, compared to other e-commerce markets, it’s been lagging in online dynamic advertising.
Previously, car dealerships focused on special deals and incentives to bring customers into the store. There, they would get a chance to look at the inventory. But, as we’ve already noted, a lot has changed in the last several years in regards to shopping and modern problems require modern solutions.
We found that dynamic advertising is a great consumer-first solution to dealership inventory issues. It allows us to specialize ad content, such as only promoting vehicles currently available. Everything from display and search ads to video ads have become dynamic in order to be most relevant to the dealership and the customer.
Personalized advertising takes these dynamic aspects a step further and customizes ads for an individual. Customization can be based on all kinds of information such as location, purchasing patterns, or even what stage of buying someone is in.
We find this improves conversion rates as well as saving money by presenting the most relevant product to a particular consumer. The numbers show this to be working. While generic ads for dealerships received an average clickthrough rate of 0.8%, our personalized versions of such ads received more than 2% clickthrough rates. More traffic means more conversions and more customers for our clients.
Using AI to Streamline Work
If all of this sounds like a lot more time and effort, it is. It would be difficult for our team to go through and tweak each individual ad copy and image to meet the needs of the dealer and client. Thankfully, new AI platforms can help to track data much more efficiently, and other automation services can help generate the necessary and personalized content for individual customers.
Stay Up to Date in 2023
If you want to stay up to date with all the marketing news, trends and strategies in 2023, continue to check out our MHP/Team SI social media channels and blogs. If you’re a client, our team will keep you posted in your monthly meetings.
You can also visit the SI Auto website here for more information.