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The Internet’s Impact on Print Advertising Session. The New Automotive Marketing Paradigm Newspaper Association of America National Automotive Account Managers’ Conference, NAIAS- January 9, 2002. Presented By. Sheila L. Sasser, Ph.D. App. Lecturer, Marketing

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the internet s impact on print advertising session

The Internet’s Impact on Print Advertising Session

The New

Automotive Marketing Paradigm

Newspaper Association of America

National Automotive Account Managers’ Conference, NAIAS- January 9, 2002

presented by
Presented By
  • Sheila L. Sasser, Ph.D. App.
  • Lecturer, Marketing
  • www.sasscomm.com s.sasser@sasscomm.com
  • Dr. Edward A. Riordan
  • Professor, Marketing
  • e.riordan@wayne.edu
  • Wayne State University
  • Detroit, MI, USA
slide3

Detroit, Michigan

sheila.sasser@wayne.edu

e.riordan@wayne.edu

outline road map
Outline “Road Map”
  • Trends
    • Advertising
    • Automotive
  • Website/Internet
    • Research
    • Behavioral
  • Ideas & Future Opportunities
  • Summary
trends
Trends
  • IAB reports Q1 & Q2 Internet Ad Revenue of $2.76 billion in US…
  • J.D. Power shows continued growth in Automotive Internet usage in 2001
  • ...43% of all used vehicle buyers use the Internet as part of the vehicle shopping process, a 27% increase over 2000
  • R2: Vary by gender & type of channel
  • R3: Vary by ethnic nationality & type of channel
  • R4: Vary by customer geographic residential location
industry ad trends
Industry Ad Trends
  • Automotive sales represent a major proportion of all retail sales
    • Even Pre Owned Segment comprises 12.5% of all retail sales equal to ($370 billion)
  • Auto advertising represents 16.4% of all nationally measured advertising
  • Newspapers = #2 medium: $18.9 billion in ‘00
spending trends signals
Spending Trends - Signals???
  • Note the mixed trend directions for OEMs…some are way up and some are way down….
  • How do we interpret these changes?
automotive advertising trends
Automotive Advertising Trends
  • Long term planning difficult (due to 9/11 and 0% incentive wars)
  • Ad Spending should slow in ‘02?
  • However last period reported 1999-2000 up 6.3% ==> $14.6 billion to $15.5 billion
automotive advertising trends1
Automotive Advertising Trends
  • 0% Financing/incentive war has pulled ahead approximately 500,000 unit sales from 2002 (400,000-700,000 range)
  • “GARAGE LOADING!”
  • 215 million units of vehicles
  • The automotive industry equivalent of retail “PANTRY LOADING” has now hit the automotive sector proliferating multiple vehicle households and aberrations of demand curves & forecasts...
automotive advertising trends2
Automotive Advertising Trends
  • We expect the OEMs to continue incentive programs to keep the plants running and to continue sales “pull aheads” (ie. GM’s $2002).
  • We expect the OEMs to continue to re-evaluate dealer advertising (ie. GM’s $500m holdback) and impose stricter format standards on their dealers for both print and broadcast.
automotive trends
Automotive Trends
  • On average, the automotive Internet user visits 6.8 automotive sites before making a purchase…preferring 3rd Party Sites
  • 6% of vehicles were sold online, up from 4.7 % in 2000, small but significant….
  • Kelley Blue Book, kbb.com remains the most visited site for the 4th straight year
automotive trends1
Automotive Trends
  • 50/50 Split between Car/Truck for 2001….
  • Truck sales for 2001 were approximately 49% of the market, with light duty trucks rivaling passenger cars (Autopacific):
  • SUVs = 44.4%
  • Minivans = 16.9%
  • Pickups = 35.8%
  • Caruck & Tall Station Wagon hybrids...
  • This will affect nature of advertising segmentation different buyers “millennials”
web trends
Web Trends
  • More dealers are creating full service websites like OEMs
  • NP ads must contain web addresses & more interactive elements
  • Everyone wants to get buyers to website
  • Dealer NP ads can be shown on NP websites along with promos, offers, etc.
    • DFP - DN - O&E examples
    • Drive dealer classified ads to NP websites
    • Conversion & integration are critical to mitigate loss - cannibalize or be cannibalized...
web trends1
Web Trends
  • OEM Website Examples
  • Instead of viewing the Internet as a competitor to NP advertising, both should work together to complement message
  • Sell the NP-Web mix to dealers
  • Traditional retailers have been integrating print, direct, web & broadcast interchangeably
  • Broadcasters have also integrated the Web
  • Several stations showcase Web & NP
web trends2
Web Trends
  • Toyota Interactive Matrix Video Promotion
  • Mazda Zoom-Zoom Interactive IMC
  • DCX PT Cruiser CRM Launch
  • Ford Focus Youth Tour
  • GM Buick Rendezvous with Tiger Woods
  • All of these unique programs were very successful in effectively generating new targeted prospective customers
our web research findings
Our Web Research Findings
  • The best website factors:
  • High Utility:
    • easy to navigate & read
    • consistent page formatting
    • understandable icons, menus
  • Pleasing Aesthetics
    • sharp images, color, quality graphics
  • Entertainment & Engagement
    • ability to grab and hold attention
    • high entertainment value
our web research findings1
Our Web Research Findings
  • Does this list sound like rules for good newspaper advertising???
  • The worst websites “bombed” on all these features especially those that trapped the user in a closed loop!
  • Time is a critical factor
web behavioral findings
Web Behavioral Findings
  • Advertisers & Automotive Dealers still trust print more than the web, but are slowly migrating and testing new ways to integrate both formats…
  • Overall Web Benefits perceived are:
  • Greater control of content on the web,
  • Flexibility to change offers
  • Immediacy of knowledge gathering
  • Instantaneous potential communication
  • Customer segmentation opportunities
web behavioral findings1
Web Behavioral Findings
  • Disadvantages:
  • Distrust of nationally sponsored sites
  • Loss of direct dealer customer control
  • Lack of knowledge of database CRM
  • Potential technology glitches
  • Customer wariness of long term viability
  • Varying levels of consumer confidence
  • Measurability & tracking issues
web behavioral findings2
Web Behavioral Findings
  • Most Business Advertisers are hesitant to pull print advertising and risk web only
  • Print still has proven tangible attributes
  • Sense of security with existing system
  • As national websites and customers become more sophisticated, change will occur…
  • Transitioning from print to Internet will depend upon ad industry innovation, advertisers, users & consumers
gender findings analysis
Gender Findings Analysis
  • Men rated online sites highest in trust & security
  • Women trusted catalog sites more than online
  • Women also trusted retailers more than the web
  • Why?
gender findings analysis1
Gender Findings Analysis
  • Evolutionary Life Cycle of the Web?
  • Familiarity, Usage, Routine Shopping Behavior?
  • Access Barriers & Convenience Issues
  • Male => Transactional Task Orientation
  • Female => Interpersonal Orientation
  • Both read Newspapers & Buy Lots of Stuff!
ideas future opportunities
Ideas & Future Opportunities
  • Smart dealers have used the Internet to reach highly profitable specialty segments of customers
  • Pre Owned, customs, collectibles, performance...
  • Newspapers can target gender, age & lifestyle specific ad message appeals combined with web, like cable TV strategy
  • Tracking of promotions, customers & CRM
  • Still use print in IMC for mass market image
ideas future opportunities1
Ideas & Future Opportunities
  • Automaker Research may also benefit dealers, newspapers & CRM
  • -Customer centric user design findings
  • -Internet focus group testing breakthroughs
  • Elite status of key dealers prompting more sophistication & evolution…
  • 5 Star - Blue Oval - GM
  • Balancing act of budgets & performance
ideas future opportunities2
Ideas & Future Opportunities
  • Programs that will affect the future of advertising in Newspapers
  • Used/Pre Owned Cars
  • Certified pre-owned programs growing rapidly:
    • Both OEMS & Dealers will need to advertise the specifics and benefits of these programs
    • Incremental budget opportunities
    • Large volumes of vehicles to move from expired lease programs, fleet & other
ideas future opportunities3
Ideas & Future Opportunities
  • The US pre owned car market is 3 times larger than the new car market...
  • It is also much more profitable for dealers thus greater ad dollars...
    • ($500/unit used vs $100/unit new)
  • Dealers will need to advertise more to help increase their profits and move vehicles
  • Greater control of ad funds in this area
ideas future opportunities4
Ideas & Future Opportunities
  • New Cars
  • OEM dealer co-op and Dealer Group Advertising will have more structured standardized modules...Multi-Brand Dealer Ads will be used for increased visibility & efficiency
  • Themed messages, headlines, events (Home)
  • White space, white space, white space
  • New ways to measure effectiveness & allocate funds…response cues...tracking
ideas future opportunities5
Ideas & Future Opportunities
  • “Two years ago the number of people who located their vehicle through a published classified ad outnumbered Internet classified by more than 7 to 1…the gap narrowed to only 2 to 1 this year and it is likely that Internet classifieds will surpass the traditional published classifieds within the next few years.” …Chris Denove, JDP
ideas future opportunities6
Ideas & Future Opportunities
  • The Automotive Category represents 16.4% of all US ad spending (CMR data, 2000, Ad Age)
  • In times of economic uncertainty…there is even more challenge, as dealers try to sustain growth fueled by 0% financing and rebate incentives…
summary
Summary
  • Pay closer attention to specific segments of buyers & their needs
  • Leverage the gender differences existing on Internet in favor of Newspaper Adv
  • Recognize sophistication levels in users
  • Promote comfort and security as key
  • Print can provide stability to web
  • Drive synergy with IMC & CRM
summary1
Summary
  • Proactive Interactive Program Modules
  • Work more closely with Advertisers to track results of integrated print/web ads
  • Create multibrand & themed modules
  • Set up third party endorsement sites
  • Inform, Engage and Entertain customers
  • Leverage print equity & reader base
  • More promotion, database & research