Automotive Industry Prepares for Marketing Changes
Automotive Industry Prepares for Marketing Changes
Online advertising is a potent sales tool for automotive marketers. The industry’s digital ad spend is already soaring back to pre-pandemic levels. eMarketer expects the industry's digital ad spend to reach $13.29 billion in 2021.* However, marketers are being forced to rethink their digital marketing strategies. This is due to companies like Apple and Google making their web browsers more privacy-friendly by banning third-party cookies. Here’s a quick rundown on what’s happening, how it impacts automotive marketers, and steps you can take today to adjust your online strategy without skipping a beat.
Consumer Privacy is in; Cookies are Out
Third-party cookies are marketing gold and expand reach compared to first-party cookies. First-party cookies only track visitor's activity on your website; however, third-party cookies track a visitor's activity on your website as well as other websites. Knowing where consumers are going online and how often, plus what they’re purchasing and interested in, provides a treasure trove of information about an individual. Marketers use third-party cookies to serve up personalized ads and show recent visitors targeted pop-up ads on other websites. However, it’s one thing to track a consumer’s activity on your website, and another to track their activity elsewhere online. For this reason, third-party cookies are viewed as invasive to consumer privacy and are being phased out. In what’s called “the cookie apocalypse,” Firefox and Safari already banned third-party cookies. Google is also slated to nix them on its Chrome web browser in 2022. Google is trying to ease the blow to cookie-reliant advertisers by developing a “privacy-first” alternative to third-party cookies. This is known as the Federated Learning of Cohorts (FLoC). According to Google, it clusters large groups of people with similar interests—effectively hiding individuals in the crowd. It then uses on-device processing to keep an individual’s web history private on its web browser. However, FLoC is currently in testing and will take some time to transition advertisers to this new technology. In the meantime, you need a plan to attract and win business.
Don’t Have a First-Party Data Strategy? Better Get One, Fast
Today, it’s important to have a strategic first-party data objective to help your dealership navigate a future without third-party cookies. This involves building a seamless, enriched view of prospects and customers across your business for more precise segmentation and targeting. Automotive marketers with a strong data strategy in place should fare well after the demise of third-party cookies. On the other hand, those lacking a solid data strategy to bridge the post-cookie information gap can expect declines in their digital marketing performance due to a lack of scalability. Likewise, expect adverse impacts on key performance indicators like cost-per-qualified lead, lead rate, cost-per-conversion, and overall digital marketing ROI. While you may think you have a lot of customer data, it’s likely not enough on its own. Here are a few questions to consider.
- Is your data siloed in different lines of business, lenders, and dealership locations? Who are the internal data stakeholders at every level of the business? How do you efficiently work with these stakeholders to find and understand fractured customer data?
- Once found, can you link that data together so you can better recognize repeat customers or members within the same household? Then you can use it to fuel personalized marketing and advertising.
- How can you confirm, update, and enrich your customer data to ensure their contact information is accurate and complete so that your marketing dollars aren’t wasted?
- Can you seamlessly augment your data with unique marketing insights pertaining to economic capacity, along with personal behaviors, preferences, and propensity to buy?
If you’re struggling with these foundational insights today, keep reading to learn how the automotive industry is increasingly turning to trusted third-party data moving forward.
Know Your Audience Moving Forward: 3 Data Strategies that Outperform Cookies
Just as third-party cookies can reveal the “bigger picture” of a consumer, integrating relevant and predictive third-party data from an experienced provider can do the same thing, only better. Here are three ways it’s helping auto brands strengthen their digital advertising.
1. Cookies can reveal interest in purchasing a vehicle, but third-party data can show you the big three: intent, capacity to pay, and willingness to pay. Most auto marketers are targeting in-market shoppers, meaning they have expressed intent to buy online. But, just because a consumer is shopping for a car online doesn’t mean they can afford it. First-time buyers are a great example. They may have no idea if or what they can afford to buy, or if they qualify for credit.
Third-party data can help because it can reveal a variety of intent signals, as well as financial capacity, so marketers can target their digital ads with laser-like precision based on:
- Household income from wages, investments, and home businesses, based on directly-measured, anonymized data
- Discretionary spending ability: a household’s spending power after accounting for the fixed expenses of life
- Credit capacity: estimated ability to obtain credit to buy a car
- Propensity to buy: interest in buying specific vehicle types, makes and models
2. Cookies are reactive, based on consumer-driven activity, but third-party data can help you proactively identify and connect with in-market consumers earlier. By monitoring when consumer auto loans and leases are about to expire, specialized third-party data can trigger alerts that identify individuals with a near-term propensity to get a new auto loan or lease. This data combined with your required credit file attributes deliver a powerful prescreen list. This can put your vehicles and offers in front of interested, qualified buyers - before your competitors even know they exist.
3. Cookies are individualized, but third-party data can expand your view to reveal household-based opportunities. Third-party data can help you augment your target lists with estimated household information and provide an expanded view of potential customer lifetime value. Targeting many household members may improve conversions. Looking ahead, one thing is for sure: third-party cookies are going away. Now is the time to seize this unique opportunity to strengthen your digital advertising by enriching your customer data with industry-specialized data and insights from a trusted provider. It can enable you to efficiently scale your digital marketing efforts in the absence of third-party cookies, while giving you unprecedented marketing flexibility and precision. You’ll get the power to hyper-personalize your audience and message so you can engage the right consumers, at the right time, with the right message so you can win more business in the months and years to come. Learn more about the dynamic, data-driven marketing tools and insights available to automotive marketers by visiting Equifax.com.