Has Post-COVID Automotive Advertising Changed for Good? Yes and No.

When the COVID period is looked back upon in the future, it will be remembered as one of the craziest times in automotive advertising history. On one hand, computer chip shortages and supply chain issues made it difficult for dealerships to get new inventory. On the other hand, however, people were lining up to buy new cars sight unseen, often for little or no discount off the MSRP, meaning better profit margins than ever before. It was the Wild, Wild West!

During that time, dealers made adjustments in the way they did business, including changes in the way they advertised. Prior to COVID, the automotive advertising industry was the clear leader in the purchase of traditional advertising (think: TV, radio, print, billboard and the like). But when the pandemic changed the marketplace, many dealers switched from a mix of traditional and digital to mostly just digital advertising, figuring they could save money that way. As part of this seismic switch, dealers were persuaded to buy leads from dot-com companies such as cars.com and kbb.com to gain new customers.

But here’s the thing about these dot-com companies: They are some of the biggest purchasers of traditional media! Think about it … in your everyday life, you see and hear any number of dot-com companies that advertise on traditional media every day – and not just automotive. There’s Amazon, Google, Facebook and all the big companies of various industries that conduct their business online. According to this article from Advertising Age, Amazon alone spent $56.1 million in advertising on radio from January through November of last year; and companies like Geico ($21.04 million), Progressive ($19.15 million) and AT&T ($15.12 million) spent big dollars on TV advertising (See this Statista report for more information.)

What was Old is Becoming New Again
We at JKR Automotive Advertising have noticed that the winds of change are beginning to calm down in the post-COVID world, and things are making a slow but steady return to the pre-pandemic way they once were. In part, it’s because automobile dealers are realizing two things: (1) By the time you add up all the digital channels it takes to do what dealers perceive to be a well-rounded ad campaign, it often costs a similar amount (or more) as a traditional campaign, which is seen and/or heard with frequency by almost everyone in their area rather than just a select, targeted few; and (2) They are figuring out that there’s less of a need to buy leads from third-party entities when they can produce the leads themselves without additional help – much like they did during their pre-COVID ad campaigns using traditional media.

Why do you suppose those big companies spend so much money on traditional media? The answer is simple. They use it as the vehicle through which they constantly remind everyone of their existence and the perks they can offer their customers. Attention, automobile dealers: Does that sound familiar?

We are not saying there’s no place for online advertising; not at all! We are merely pointing out that on part of a multi-pronged advertising approach that should include a healthy dose of radio and television! Think about it this way: It isn’t who sells the most cars; it’s who has the most net profit at the end of the day!

Next time, we’ll discuss what you do with your customers once you get them to your physical and/or virtual dealership … and how to increase your odds of turning these opportunities into sales.

JKR Automotive Advertising: We Move Cars.

To find out what JKR Automotive Advertising can do for your dealership, call us today at (321) 397-0777 to get the wheels in motion.