J.D. Power and Associates Reports: Special Interest Sites More Effective To Reach New Car Buyers

JD Powers: Online Advertisers are More Likely to Effectively Reach New-Vehicle Buyers at Travel, Special Interest and Finance Web Sites than Most Automotive Shopping Sites.

Publisher's Note: For the past 8 years our ad sales representatives have been beat up because The Auto Channel is "Not a Car Buying Site".

During each ad presentation our reps have tried to convince the agency executives of our belief that putting ad money against in-market, in-funnel prospects should just be a part of a car makers overall interactive ad budget not the whole thing...and that sites like The Auto Channel deserve a portion of the ad budgets…but unfortunately to no avail.

Our sales team has been fighting the agency’s accepted and supported “Low in the Funnel” belief and now finally after years of banging our heads against the wall this J.D. Powers research supports our long term position.

So now I will be happy to discuss why The Auto Channel is still not a “car buying site” and why today The Auto Channel is an even better way to effectively deliver automotive messages to smart upscale auto enthusiastic Women and Men.

For years we have presented Detroit's ad buyers and planners with our supposition that by the time in-market prospects get to the major auto buying sites it's too late for a second or third choice to effectively convince and than conquer, or switch-pitch a prospective buyer...we still believe that the optimum time to effect and influence is before a final decision is made as to which vehicles to consider for purchase and to test drive.

For those TACh viewers who care, at the end of this story I have reproduced one page from a three year old TACh sales presentation that was given to GM Planworks executives (and other OEM Ad Agencies).

Their response then was that our viewers were not in the correct funnel...how many millions of dollars were flushed down their funnel in the pursuit of auto sales?

WESTLAKE VILLAGE, Calif.: 31 July 2006 Targeting new-vehicle buyers at travel, special interest and finance Web sites is considerably more effective for upper-funnel brand marketing than placing advertising on most automotive shopping sites, according to the J.D. Power and Associates 2006 Online Media StudySM –Wave 1 released today.

The inaugural study is the only online media research in the industry that is based on a random national sample of 10,724 verified new-vehicle buyers with Internet access who purchased a vehicle in September or October 2005. The study takes an in-depth look at the Internet usage and behavior of new-vehicle buyers to identify Web sites that most effectively target desirable advertising audiences in terms of reach, scope and cost.

“In terms of Internet advertising, once consumers visit an automotive shopping site, they’ve already narrowed their vehicle consideration set, which means that online advertisers are missing an ideal branding opportunity,” said Steve Witten, executive director of automotive research at J.D. Power and Associates. “By focusing on new-vehicle buyer behavior on the Internet before they begin actively shopping for their next new vehicle, automotive marketers can identify the Web sites with the highest probability of reaching prospective buyers more effectively than ever before.”

While most Internet users are reached by the most popular sites such as Google and Yahoo!, the study finds new-vehicle buyers can be found following their interests and lifestyles at sites such as WebMD and Home Depot five times more often than general Internet users. Given their affluence, these buyers use financial sites such as Yahoo! Finance and MSN Money six times more often than general Internet users. They are also four to five times more likely to use travel sites such as Expedia.com or Travelocity than general Internet users. The Online Media Study uses general Internet user behavior from Compete, Inc. to demonstrate comparisons with new-vehicle buyers.

“While new-vehicle buyers are a niche of only 6 percent of adults in any one year, they are a highly desirable group of consumers for advertisers, and they behave very differently online than general Internet audiences,” said Witten. “This is a significant opportunity for marketers, especially when they can analyze down to the vehicle segments from which these buyers cross-shop. Marketing is often the most inefficient part of any business in terms of spending. By understanding where certain consumers spend their time online rather than relying solely on general Internet visitation numbers, marketers are able to reach key audiences, often at fees that provide more bang for the buck.”

The study finds that visitation to particular Web sites can vary greatly by the type of vehicle consumers are likely to purchase. For example:
• Large pickup buyers have above-average visitation rates to NASCAR.com and many home improvement sites
• Midsize pickup buyers are much more likely than others to visit sports-related sites
• Female prospects for mini vans and large SUVs frequent Disney Online and game sites
• Those interested in sports cars not only visit auto enthusiast sites, but also are frequent visitors to several travel-related Web sites
• Luxury buyers are more than twice as likely as non-luxury buyers to visit Apple’s iTunes music store, due in part to high ownership levels of MP3 players in this segment

About J.D. Power and Associates
Headquartered in Westlake Village, Calif., J.D. Power and Associates is an ISO 9001-registered global marketing information services firm operating in key business sectors including market research, forecasting, consulting, training and customer satisfaction. The firm’s quality and satisfaction measurements are based on responses from millions of consumers annually. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands such as Standard & Poor’s, McGraw-Hill Education, BusinessWeek and J.D. Power and Associates. The Corporation has more than 290 offices in 38 countries. Sales in 2005 were $6.0 billion. Additional information is available at http://www.mcgraw-hill.com.

Presentation given to GM Planworks in Early 2004

(Title Page) In automotive marketing like basketball or hockey– a last second shot may sometimes win the game…but it can never become a substitute for a well executed game plan that includes consistent elements that will more likely result in a victory.

The Internet offers car makers three distinct “time frames” in which to “take a shot” at convincing auto buyers and/or their coaches which brands and models they should consider for purchase:

First Shots : Big Reach Non Automotive Sites: MSN, CNN, YAHOO, FOX, Etc. - Big nets for non-targeted audiences.

Last Shots: Automotive Shopping Sites: Kelley, Auto-By-Tel, CARS.COM, AutoTrader, Etc.- auto makers who advertise on these sites are hoping to switch-pitch in-market buyers while they are on-line searching not for more information, but for “the best deal” on an already fait 'acomplis brand choice…which may have been made over months or even years of research.

Best Shots: The Auto Channel provides auto manufacturers with an editorial platform to help make their brand and specific models the “incumbent” by consistently presenting sales messages imbedded within relevant automotive content, before and during the time the buyers are in the market.

During the past 8 years, relevant automotive information delivered to users of The Auto Channel has grown from zero to as many as six million pages each month. This information resides in an interactive library of more than 500,000 pages of text, tens of thousands of images, and nearly ten thousand streaming audio and video on-demand programs all automotive and all instantly accessible by millions of auto enthusiasts and buyers.

Publishers Note: The ad experts at GM Planworks (and other Big Three Ad Agencies) have never viewed the in-market segment as we did (do), or believe that we knew(and know) what we are doing...the proof; to date we have not delivered one dollar of advertising to our influential audience for any Detroit car maker since we made this presentation...and now after this expose' I don't expect the agencies will ever do business with us directly without "client intervention", but as a GM and Ford stockholder I would expect...no, demand to understand why, with GM, Ford and Chrysler sales falling into the sewer, why their appointed and anointed ad gurus' continued(and continue) to ignore potent ad media like The Auto Channel in favor of the obvious and now proven wastefull Internet Site choices that they have supported with millions of dollars of their clients ad money.

If you would like to see the complete PowerPoint presentation just e me at bgordon@theautochannel.com, we would be happy to get a shot at ad budgets not just the satifaction of being correct!