I recently sat-in on a meeting to review the performance of an in-market digital auto campaign. The campaign was a 30-day in-market advertising push for a full-size sedan that sells around 2,000-3,000 units each month. The review started with the following sentence:
The campaign reached 15MM unique households.
For the next hour, we shared metrics and discussed how “efficient” the campaign was from a cost-per-qualified-action standpoint. I can’t recall what was said in the meeting because all I could think of, after 21 years in auto, was the wasted spend that targeting 15MM households for a vehicle that sells 2,000 units per month generates.
I wish I could tell you that this kind of wasteful targeting is an anomaly. Unfortunately, it’s not. There are 3 main drivers of inefficient targeting that stem from 3 myths widely held by automotive marketers.
By their very definition KPI’s are not goals, they are indicators. Think of them like rungs on a ladder that lead you to your goal. There’s only one business goal for in-market campaigns: reaching buyers.
When looking at the best indicators for reaching buyers, qualified actions on OEM websites are very limiting. During that vital window of time 90-days or less before purchase, only about 25% of new car buyers engage in a traditional OEM site KPI prior to purchase.
That’s because car buyers have so many options when it comes that the final leg-of-the-mile of their purchase decision: auto endemic sites, dealer sites and so much more.
If you’re only looking at website KPI’s, you’re only reaching a small fraction of your buyers.
It all sounds very logical. If I can onboard my first-party owner file, I can leverage lookalike modeling to find consumers that look like my recent buyers. Then I can do the same for my KPI completers.
If your campaign goals are KPI focused, lookalike targeting will hit every number you need it to: qualified action volume, cost-per-action goals, etc.
The one thing it will miss by a mile: efficiently reaching car buyers. Just because someone looks like, acts like, or browses like someone who just bought a car doesn’t mean they’re actually in the market to buy now.
Save lookalike targeting for broad prospecting tactics and consider incorporating suppression or overlay tactics to maximize efficiency and reduce wasted ad spend.
For example, if you run lookalikes for in-market campaigns, add a “New Car Buyer” or “In-Market” overlay to help increase the likelihood of reaching qualified auto intenders.
No it doesn’t. In today’s flat auto market, sales growth equals share growth. With brand loyalty at an all-time high, the pool of potential conquest opportunities is shrinking.
So when it comes to your digital campaigns – the focus should be on audience quality, not scale. TV is still widely used by OEM’s to support sales events and in-market activity which maximizes scale – invest your digital dollars to focus on car buyers. Here are a few tactics you can use to find those buyers:
Your audiences will be smaller and you may not hit your current KPI or cost-per-action goals. You’ll need to test new optimization strategies like reach vs. site conversions for your in-market campaigns. But you’ll stop waste like targeting 15MM households to support a model that sells 2,500 units per month and do something new: target actual car buyers.