Who has the Financial Capacity to Buy this Holiday Season?
During the holiday season, automotive ads and promotions used to be dominated by luxury brands portraying their automobiles as surprise gifts for loved ones - complete with a giant red bow on top. In recent years, advertisers haven't limited that type of promotion to luxury. The question, however, is how will COVID-19 impact holiday promotion plans - and consumer spending?
In past years, people were out shopping, and automotive companies wanted to make a splash. In fact, brands spent a total of $3.7 billion on holiday advertising in 2018. Automotive brands represented nearly 10 percent of that spend, according to MediaPost.
This year may be different, though. COVID-19 has significantly muddied the economic waters in terms of who has the financial capacity to spend.
With New Challenges, Accuracy Matters
During these challenging economic times, it’s even more critical that auto brands and agency partners target the right consumers. This has come with challenges in the best of times. Pre-COVID-19, only 14% of marketers overall said their audience data buys were very effective, resulting in wasted ad spend and lost revenue, according to a report by Lotame. Accuracy matters.
This year, automotive brands and agency partners are combining traditional vehicle promotion data with audience targeting segmentation data and insights.
This helps them better target consumers who actually have the financial capacity to make a purchase. This advanced set of data and insights provide the ability to target in-market make/model intenders. It also provides their estimated financial capacity. As a result, OEM brands and agency partners can run more effective retention, acquisition and conquest campaigns across digital channels.
Add an Extra Layer of Audience Segmentation
This is where audience segmentation comes in. Sophisticated data today is uniquely built using robust data sources. These sources include estimated income and asset data contributed directly from the IXI Network of financial institutions, as well as aggregated credit information.
This anonymized data can help estimate nearly 50% of all consumer assets and investments, making it uniquely predictive of a prospective buyers’ financial capacity.
In the past, OEM brands and their agency partners have leveraged datasets based on unverifiable survey or panel data.
Why is this Important?
Not all high incomes are the same. Every household leverages debt differently. But OEMs can gain more visibility into a person’s or household’s ability to pay with differentiated data assets like audience segmentation. By taking credit-income spending behaviors into account, OEMs have the ability to offer incentives to people based on their unique financial situation - all while maintaining user privacy.
With this sophisticated level of data, OEMs and advertisers can better differentiate and reach online consumers who are likely to have the financial capacity to buy their products and services.
Today’s anonymized household economic data is not enough. It's now combined with discretionary spending, credit, demographics, buying behaviors, and insights into make and model preferences. This delivers matches with better auto audiences, who are more receptive to holiday campaigns and offers.
No doubt, the holidays will feel much different this year. But with the right data and insights, automotive brands and agency partners can ensure they’re getting the most out of their creative campaign investments. Learn how Equifax auto solutions can help.