Insights: How Auto Dealer Advertising Works

As the U.S. continues its emergence from the pandemic, the Federal Reserve finds auto sales are recovering. In January of this year, the seasonally adjusted annual rate (SAAR) was 15 million vehicles, up from a dip in Q3 and Q4 2021. Americans are spending, and the time for auto dealers to advertise is now. 

This week’s Cumulus Media | Westwood One Audio Active Group® blog looks at marketing strategies backed by attribution insights for auto dealers.

• Marketing effects take place over an extended period of time: According to a firm called Gain Theory: 18% of current marketing investments impact this month, measured via attribution modeling; 24% of this month’s advertising impact occurs in one and five months; 58% of this month’s advertising impact occurs in six months and beyond.
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  Creative and reach are the two biggest sales drivers: A major Nielsen sales effect study of 500 campaigns revealed half of all sales effect has to do with creative.
• A Nielsen analysis finds one of every three ads on local TV are political in the run-up to an election. This means dealers will be shut out of local video platforms like local cable, broadcast TV, YouTube, and connected TV.
• Nielsen: Since 2018, TV reach has dropped to 72% and ratings are down -34%.
• Cord cutting is a major driver of TV’s audience collapse: The MRI Simmons How Americans Watch TV report reveals 46% of the U.S. have cut the cord.
• Streaming is now “TV”: Half of Americans say streaming has replaced traditional TV. From 2018 to 2021, the number of video streamers who say “streaming has replaced traditional TV” has surged from 37% to 49%.
• AM/FM radio adds incremental reach, making TV better: According to the latest Nielsen Total Audience Report, AM/FM radio outreaches live and time-shifted TV across every major demographic.
• When it comes to ad-supported audio in the car, AM/FM radio is the “queen of the road” with shares in the mid to upper 80s across every buying demographic.
• According to a LeadsRx analysis of 1.8 million AM/FM radio commercials, AM/FM radio campaigns generate significant auto dealer website traffic.