Automotive Ad spend Online
Center for Media Research: At $31 billion in 2007, automotive is the #2 advertising category in the US says the new report from Borrell Associates. Online spending for the industry is expected to reach $2.8 billion in 2007, comprising of 7.6% of all automotive advertising, and representing an annual growth of 13%. The most disruption is at the local level, especially in used-car marketing. New-car devotes 5.6% of its ad budget to online media while used-car dealers spend 19.6% of ad budget.
The online segment, is expected to hit the $4 billion level by 2010 to become the second largest medium for automotive ad-spend. The Budgets for offline auto ads in newspapers, direct mail and directories is expected to decline by 20% each during the same period.
With used car dealers allocating 20% of their spending to online, the medium will become the top marketing channel for used-car marketers this year, surpassing newspapers for the first time. The report says that local car dealers will spend 29% of their online ad budget on online video and paid search this year, but will increase that proportion to 76% of online marketing by 2012.
The report also points out that the Internet is not yet effective at reaching car buyers still in the “dreaming” stage, and that manufacturers will use TV spots to sell their brands and then drive prospects to a Web location.
Anticipating the growth of verticals a number of advertising networks have come up which focus on specific verticals - for instance jumpstart Automotive Media, which focuses solely on the automotive industry.
Related articles:
Internet Captures More Automotive Ad Dollars
Web Spending to Surge as All Auto Ad Spending Growth Drops
Online ad spending will grow by 23 percent
Regional dealer advertising moves online (pdf)
Filed under: Ideas & Innovations, Statistics, Trends