Automotive: Part III Internet s Effect on Advertising

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1 Automotive: Part III Internet s Effect on Advertising John Potter VP Interactive Revenue Development Director Radio Training Academy Here s What We ll Cover 1. Automotive slow down 2. Auto ad budgets 3. Where dealers are advertising 4. Lead buying 5. Win back the bucks Goal s For Today Page 1

2 FFF Error Foreign Fuel Financing Automotive Drives America $924 billion in sales in % of total t retail sales in the US 1.3 million employees Another 6.6 million related employees US Largest ad category $19.8 Billion Sources: US Dept. of Commerce, 2008; University of Michigan; Advertising Age, June, 2007 Page 2

3 Automotive Drives America A Sales Slowdown Total US Units Sold In Millions P Sources: JD Power & Associates, January, 2008 Automotive Drives America A Sales Slowdown Domestic off 15.5% in August GM down 20% Ford down 26% YTD industry down 11.2% Pickups and SUVs are stalled Chrysler no longer leasing Toyota & Honda short on small vehicles Nissan up 14% Sources: New York Times, September, 2008 Page 3

4 Automotive Drives America A Sales Slowdown Ad spending down 6.1% through May Down Up Toyota GM Ford Chrysler Honda Nissan Sources: Advertising Age Turning To The Internet Moving Traditional Ad Budgets GM moving half of its $3 billion Hyundai s VP Marketing: Online may be more important than spot. Audi more than doubled online advertising Sources: Advertising Age, August, 2008; e Market, June, 2008; Page 4

5 Turning To The Internet Moving Traditional Ad Budgets 25.00% 21.6% 20.00% 15.00% 10.00% 5.00% 0.00% -5.00% % -6.1% Total Internet Sources: Advertising Age, August, 2008; e Market, June, 2008; Turning To The Internet Moving Traditional Ad Budgets 2.1 billion automotive online impressions in July 5.5% of all Internet impressions in the US Sources: Nielsen NetRatings, July, 2008 Page 5

6 Turning To The Internet Moving Traditional Ad Budgets 80% of consumers consult the Internet at least once during the car buying process (up from 71% in 2006, 64% in 2004) Internet reviews are replacing recommendations from family and friends 78% of Internet tusers who read an online review said it influenced their purchase decision 40% of leads are from the Internet Sources: Capgemini, 2008; comscore/kelsey Group, 2008; RAB, 2008 Online Advertising Types Classifieds New Used Display (banner ads) Search / Keywords Rich Media Video Audio Animation Promotions Micro sites Lead Generation Page 6

7 Automotive, Part III Internet s Effect On Advertising Classifieds New Classifieds Used Page 7

8 Classifieds Local CBS Dallas Classifieds Local Columbus Fizmo Page 8

9 Classifieds Local Mineola, TX Classifieds Local WOOD-TV, Grand Rapids Page 9

10 Classifieds Local Columbus Dispatch Classifieds Local Vehix White Label Page 10

11 Display Ads Search / Keywords Clear Channel Page 11

12 Rich Media Promotions Page 12

13 Micro-sites Lead Generation Automotive sites collect leads Sllt Sell to dealers Screened Address check Phone check 3 rd Party check Not screened Exclusive Non exclusive $25 per lead average Page 13

14 Lead Generation Marty Johnson Internet Manager Nelson Auto Group Lead Generation Page 14

15 Lead Generation Lead Generation Page 15

16 Lead Generation Classifieds sites Paid leads sites Factory site Dealer site Win Back The Bucks Recapturing Auto Dollars Promote the value of your on air product Use marketinginformation information Develop an automotive Internet strategy Online advertising Online classifieds Online search / keywords Online promotions Contests t Micro sites Custom ideas (virtual test drive, find the key video game, online used car auction ) Online directory Page 16

17 RAB Resources RAB Resources Page 17

18 RAB Resources RAB Resources Page 18

19 RAB Resources RAB Resources Page 19

20 RAB Resources RAB Resources Page 20

21 Thank you for joining us! You will be receiving an e mail with a link to download a PDF copy of these slides, glossary Please share your thoughts in the evaluation form RAB Member Response ; John Potter Page 21

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