In 2008, the Direct Marketing Association reported that:
- By 2012, auto manufacturers are expected to invest $9.8 billion in direct marketing, yielding $108.1 billion in sales, with an ROI of $11 billion.
- Vehicle retailers will see a slight decrease in ROI, to $33.67 billion by 2012. That will result from spending $8.8 billion on direct marketing advertising and earning $297.8 billion in sales.
- Direct-order campaigns produced at least 40% of direct marketing sales in 2007.
- In the third quarter of 2007, Toyota was the number one vehicle brand mailer of service promotions.
- Of the domestic brands, Ford, Chrysler and Dodge sent out the most direct mail sales campaigns during Q3 2007.
- Of the foreign auto brands, Toyota, Mercedes-Benz and Honda sent out the most direct mail sales campaigns during Q3 2007.
- Most direct mail sales pieces sent in Q3 2007 were aimed at acquiring new customers.
About 75% of the auto industry’s direct marketing investment and sales center around consumers, with business-to-business sales making up the remainder.
In hindsight, historical data aside, the predictions seem absurdly bullish, and there seems to be little correlation between the fact that Ford, Chrysler and Dodge sent the most direct mail and the performance of those companies. So what role does e-mail play in the automotive category?
E-mail intelligence is the answer. E-mail intelligence is demographic, behavioral, contextual and psychographic data available via the e-mail channel that can be acted upon to inform smart marketing decisions. While leveraging intelligence available across the e-mail channel and other relevant channels cannot save the big three from all their perils, the truth is all automotive category advertisers (all category advertisers for that matter) can do a much better job of engaging their true target customers every single day of the week. They simply need to understand how.
Historically, many dollars have been spent on direct campaigns across automotive dealerships with greatly diminishing results as the data driving the campaigns aged. Another challenge has been validity. Direct campaigns of the past somewhat necessarily relied on assumption-riddled models of sending mail or calling into former customers based on self-reported data from the point of sale or purchased lists. Data derived this way are often invalid. Today, there are better alternatives.
Today’s most progressive automotive marketers are using e-mail data that provides information about who is shopping for what and when to inform campaign execution. They are then coupling this information with verified postal and phone information to execute smart campaigns on a local level for maximum results.
For example, a dealership in Dallas might leverage e-mail intelligence regarding which consumers are actively in the market to sell or trade in their vehicle or alternatively to obtain financing or insurance or warranty protection. They would then obtain information about consumers in their market in order to intelligently communicate with those most apt to respond to their valuable calls to action. The result? Like other categories, when this type of intelligent cross-channel targeting takes place, the lift in results is significantly higher.
Additionally, looking across the data can actually help tell marketers which products and services to promote based on real-time buyer activity. For instance, as you might expect, this quarter has been a terrible quarter for new automotive sales. However, it has been a much stronger quarter for financing, insurance and warranty sales.
The takeaway? Automotive category client or not, don’t assume anything these days. Employ intelligence in all your multichannel marketing efforts. And, most importantly, act on it to drive greater results.