A spending giant in the advertising world, the automotive industry shells out billions of dollars on traditional and digital marketing efforts each year. According to a study from Borrell Associates, auto manufacturers and dealers were predicted to spend $32.8 billion on advertising in 2013, a 2% increase from 2012. Digital marketing is the fastest growing category, with an 18.7% increase in spending. Within this category, online video marketing reigns supreme, driving the highest engagement rates for automotive brands and sellers.
Clearly, 2013 was a big advertising year for the auto industry. Digital ad spending reached an all-time high and is expected to see consistent growth in coming years. According to an eMarketer report, the U.S. automotive industry spent $5.18 billion in 2013 on paid digital advertising. That total is predicted to rise to $10.36 billion by 2018.
“By the end of the forecast period, automotive will rank as the second-largest industry segment in the US for digital ad spending after retail, keeping it near the forefront of digital marketing for at least the next several years,” states an eMarketer article.
eMarketer also asserts that by 2018, the automotive industry will hold a 13% share of all U.S. digital ad spending. It has become essential for auto makers to invest in digital marketing because 53% of consumers expecting to buy a car within the next three months said that online or mobile advertising influences their car buying decisions the most (findings from a Videology study).
When it comes to digital advertising, online video has become a staple of many automotive brands. It allows them to break out of the confines of television, create a broader story line around their products and connect with consumers in a more intimate way.
Vdopia, a mobile video advertising platform and ad network, released an October study in which it reported a 251% growth in video ad impressions and a 160% growth in video ad spending for the automotive industry. Additionally, 47% of digital automotive marketing campaigns used video to drive engagement.
Obviously, not every automotive ad went viral, but there were a few key standouts from 2013.
Dodge Durango & Ron Burgundy Campaign (Top 9 Videos in campaign)
20,862,000 Combined YouTube Views
250,629 combined social shares
To view the other campaign videos, click here.
Kia’s ‘Soul Hamster 2014’
13,386,000 YouTube views
318,000 social shares
10,176,000 YouTube Views
622,000 social shares
8,925,000 YouTube Views
763,000 social shares
_______________________________ Updated 3/4/14 ______________________________
Automotive brands stepped up their game in Q4 2013—in terms of video views, the vertical placed second with 308.2+ million views. This was due largely in part to the Ron Burgundy campaign (mentioned above) and Volvo Trucks’ Live Test starring action star Jean Claude Van Damme.
The Live Test spot was the number two campaign of the quarter, earning more than 106.2 million views during Q4. It is now the most viewed automotive ad on YouTube, and the company reports that the video has been shared over six million times, earned over 10 million impressions on Google.com, has been the subject of over 20,000 media publications, and generated an estimated €70 million in earned media.
These companies leveraged online video to achieve campaign goals of branding, awareness and engagement. As early as 2010, the automotive industry ranked number two on the list of leading North American industries for online video content.
Though there are a few companies that constantly produce content with high viewership and engagement rates, automotive video ads ranked fourth in Q1 2013 for social sharing. Surprisingly, the auto sector performed fairly poorly in terms of social engagement for Super Bowl ads. Video shares did increase from Q4 2012 by 377%, but this was not enough to boost the industry above fourth place in the percentage of total shares garnered during that period.
Taking these statistics into mind, below is our 2014 outlook for the automotive industry:
Predictions state that dollars allocated for digital marketing will increase significantly during 2014. However, these numbers may be off from the actual amount advertisers will spend on online marketing because of three key events: the Super Bowl, the FIFA World Cup and midterm elections. We expect these events to increase online ad spending beyond current predictions.
The automotive industry still relies heavily on traditional television advertising. According to Andrew Capone, senior vice president of marketing and business development for NCC, a national ad sales company owned by cable TV provider Comcast, Time Warner and Cox, “Mobile and online extensions are growing…but they remain supplemental to the core marketing platform, which still revolves around television. If you look at cable, we have 40 to 60 different networks we can insert commercials in. That allows us to provide a targeted niche audience for an advertiser.”
At ViralGains, we predict that automotive brands and advertisers will continue to invest in television marketing while also increasing budgets for online video marketing. The Super Bowl in Q1 will dramatically affect automotive advertising campaigns across both platforms. In order to maximize engagement and social sharing during the Super Bowl, automotive companies must focus on creating shareable content while also fueling video discovery. Though visibility during the Super Bowl will increase viewership online, utilizing paid media for online video content will expand total reach and drive further social interactions with branded content.
Last year, Dodge used paid media to launch its Ram Super Bowl commercial ‘Farmer.’ The online video earned over 16 million YouTube views and generated almost one million social shares. Paid media allowed Dodge to maximize views, shares and conversations with its ad.
ViralGains expects the automotive industry to focus more heavily on digital advertising KPIs this quarter such as click-through rates (CTRs), awareness, engagement and of course ROI. Many automotive brands have a strong presence on TV, but must bring their television ad-spot know-how to the Web in order to maximize brand exposure and social interactions.