TV to Maintain Market Share in Auto Industry Media Mix

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Last month, I blogged on several reports that projected a fourth quarter spike in auto industry advertising. A recent post in TV News Check suggests there’s reason for optimism in 2012. All three source of auto ad dollars – manufacturers, dealer associations, and dealers – should increase their spending next year.

TV marketing expenditures in this industry have fluctuated wildly in the past several years:

  •  2007: $4.2 billion
  • 2009: $2 billion
  • 2010: $3 billion

It’s not until 2015 that TV advertising in this sector will again reach $4.2 billion. The main reason for the slow recovery is the lower than average sales of new cars and trucks in the U.S. But local TV executives believe that more advertising is inevitable. The old vehicles consumers have been holding onto will need replacement. And selling the new hybrids that are coming into the market will require educational  campaigns. These are key reasons for all automotive marketers to advertise.

Research shop BIA/Kelsey has predicted that TV should be able to maintain the 26% share it now holds in the local ad market for automotive. However, newspapers may see a decline from 27% to 18% through 2015. The other big winner in local auto advertising will be online. Several major ad agencies, including Group M and Initiative Media believe that any shift in media mix by auto marketers will be directed to TV as dealers target consumers primarily within a 10-mile radius of their location.

This trend is indeed good news for TV stations, especially for those who are also selling online advertising on their websites.

[Source: Consoli, John. Auto Advertisers Rev Up TV Spending. TVNewscheck​.com. 7 Sep. 2011. Web. 22 Sep. 2011]
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-owner of several small businesses in the health care services sector.