BY Kathy Crosett
Automotive sales in 2020 will slow a bit this year, but advertisers will try to convince consumers to purchase as they plan to spend 47% of auto ad budgets on digital advertising. The National Auto Dealers Association predicts that U.S. automotive dealers will sell about 16.8 million vehicles in 2020. This level will come in slightly below the 17 million vehicles that dealers sold in 2019.
Market Shift
The model mix has changed significantly in the past few years, with light trucks expected to account for about 75% of new vehicle sales this year. 10 years ago, light trucks accounted for only 48% of new vehicle sales.
47% Of Auto Ad Budgets Go Digital Advertising
To sell new vehicles this year, auto makers and dealers will spend $15.8 billion on local market advertising. Of that amount, roughly 47% of paid media will go to digital advertising formats. This spending projection comes from BIA Advisory Services. BIA analysts have broken out key components of projected automotive local ad spending this year as follows:
- Local broadcast TV $3.7 billion
- Local broadcast radio $1.7 billion
- Mobile $2.7 billion
- OTT $211.5 million
Both local TV and radio will register noteworthy declines of 6% and 2%, respectively, in terms of automotive vertical ad revenue this year. However, spending on several digital advertising formats will increase significantly in their stead. We can expect increases of 18.5% for OTT, 11.3% for mobile, 11.3% for email and 10.3% for online radio.
Rick Ducey, managing director of BIA Advisory Services, reports that, “The biggest digital ad format is digital video. Auto marketers value video, but like the audience targeting and attribution that they get on digital ad platforms."
As consumers shop for their new rides this year, NADA senior economist Patrick Manzi notes that, “Consumers like the added practicality and ride-height afforded by light-trucks. And crossovers, which account for more than 40 percent of the total new vehicle market, continue to increase in fuel efficiency each year.” There's no question that trucks and crossovers will be in big demand.
You can help your automotive clients target truck and crossover shoppers by checking out their profiles on AudienceSCAN. The detailed profiles include data on lifestyle, purchase intent and the kind of marketing formats that influence their decisions. You’ll find the profiles on AdMall from SalesFuel.