The world of digital advertising is constantly in flux. Consumers watch and participate with digital content in new ways every year, and it’s crucial to keep up with the latest trends to stay competitive. The automotive industry is no exception – so it’s time to ask: what trends emerged in 2018 and what can we expect in 2019.
Here’s a breakdown of this year’s trends provided by eMarketer’s US Automotive Industry StatPack:
Auto ad spending at record high
In terms of spending, the auto industry is on top. Last year, dealership spend on digital advertising made up more than half of total ad spending for the first time, according to the National Automobile Dealers Association (NADA). Looking ahead, the auto industry will have the second largest share of the digital ad spend this year with 12.5% of the market. The only industry ahead of auto is retail, which will account for 21.9%. It’s important to note that new-vehicle sales fell 1.7% in 2017, though, which is the first decline in eight years. Car ownership saturation is at an all-time high, and companies are lowering prices and budgets accordingly. Although the auto industry is spending more, it’s gaining more control.
OTT Viewership the new frontier for digital advertisers
When it comes to the specifics of how that money is spent, preferences are leaning towards Over-the-top viewership (OTT). This form of viewership occurs when consumers watch TV via Netflix, Hulu, Amazon, and directly through network apps like FX NOW and HBO GO. It goes without saying that streaming services are dominating the space, but it’s also crucial to note that the network apps that have been created and simplified in response are gaining quite a bit of traction as well. These network apps allows users not just the ability to watch content on demand, but there’s often not much lag time between when the shows air and when they’re available for streaming. 64% of automotive advertisers are buying cross-platform package deals with cable/satellite providers to tap into the OTT marketing, according to an April 2018 Interactive Advertising Bureau survey.
Traditional TV advertising shrinking
And while OTT viewership is up, traditional TV advertising is on the decline in the auto industry. For example, only six auto brands bought ads during the Superbowl this year, as opposed to seven in 2017, and nine in 2016. Additionally, TV’s share of ad spending among dealers shrank from 24% to 15% between 2017 and 2018, and that trend is forecasting to continue. As cable TV viewership continues to decline, it only makes sense for advertisers to put more money into the OTT space, desktop, and mobile ads. In the world of desktop and mobile ads, desktop has 30.6% of the market while mobile holds 69.4%. The advantage to desktop being that the auto ads placed in that forum registered higher engagement.
Video advertising driving engagement
Lastly, auto advertisers are using video to drive engagement on social media in a big way. To be more specific, automotive advertisers account for 37.7% of digital video ad spend, coming in second behind the travel industry. 15 and 30 seconds are dramatically increasing in popularity, but so are livestreams of vehicle launches. A prime example of the latter took place in March, when Subaru launched the 2019 Forrester live on its Facebook page. The video was a huge success, garnering 73,000 views and over 600 shares. Video advertising is also helping drive programmatic advertising sales higher, as the report shows that 60% of automotive advertisers plan to invest in programmatic digital video this year.
All in all, it’s clear that the automotive industry is adapting to the contemporary world of advertising just like it should be. While the sales for new cars are plateauing, automotive advertisers are beginning to control a significantly larger share of the market. And while traditional TV viewership is declining, advertisers are funneling money into OTT, desktop, and mobile ads instead. Lastly, video content seems to be key to automotive marketing success. Offering engaging, high-quality content is never a loss, and auto marketers need take note. As we’re finding out, reaching audiences in the contemporary world is not impossible. It just requires flexibility, creativity, and an ear to the ground.
What trends will you adopt in 2019? Leave a comment to share your thoughts.Published on October 24, 2018