According to a recent eMarketer study, the auto sector is experiencing slowing growth in vehicle sales, parts sales, and digital advertising spend. It’s more important than ever to ensure your auto marketing efforts are optimized to drive the most valuable sales leads at the lowest cost per lead. Improving all steps of your conversion funnel—especially high-converting consumer calls to dealership business development centers and call centers—is necessary to make the most out of your digital media budget.
Read on to learn more about the slowing auto sales and ad spend growth, why calls are so important to the auto industry, and how a conversation intelligence solution can help you drive sales while decreasing cost per lead.
The Auto Sector’s Flat Growth by the Numbers
This year, the auto industry is seeing the slowest growth rate since 2011. eMarketer’s latest forecast predicts that 2019 auto sales and parts sales will grow just 2% to $1.299 trillion. This slowing growth is expected to continue through 2022.
Image Source: eMarketer
As stated by eMarketer forecasting analyst Cindy Liu, “auto buyers remain hesitant to purchase new vehicles amid uncertainty surrounding the economy and rising interest rates.”
These shifts in consumer purchasing behavior have a big impact on U.S. total retail sales. After all, the auto industry is 23.7% of all U.S. retail sales, making it the largest sector. Any changes in auto sales, parts sales, and accessories sales impact the national aggregate.
As auto sales growth slows, so too does auto digital ad spend. The auto industry is expected to fall from the second-highest to third-highest spender on digital ads. In 2019, auto is projected to spend $15.91 billion. This is up 15.8% from 2018.
While this seems like a strong increase in ad spend, it’s actually a smaller increase than in previous years. Prior growth rates were 21% (2017 vs. 2018) and 24.7% (2016 vs. 2017).
Image Source: eMarketer
According to eMarketer senior forecasting analyst Oscar Orozco, new technologies, stricter emission standards, and changing car-buying behaviors lead to decreased ad budgets.
It’s also important to note that the increase in digital ad spend, while less than the previous year, still outpaces the increase in vehicle and parts sales. In other words, marketers are spending more but not seeing a corresponding bump in sales. This declining marketing ROI is a big problem.
So What Does This Mean for Auto Marketers?
If you’re a marketer using digital ads to drive sales for vehicles, parts, and accessories, you’re facing an industry with declining sales and ad spend. That means you need to optimize your digital advertising strategy to make it more efficient and effective.
Make your marketing strategy work for you. Optimizing elements like channel allotment, audience targeting, ad messaging, and keyword bidding can help you make serious gains in finding quality prospects, scheduling appointments, and making sales at lower costs per lead.
Wondering where to start? Look at consumer phone calls. Phone calls in the auto industry are a key component to making these ad optimizations and generating the most sales opportunities and revenue from your ad spend.
The following statistics highlight just how important phone calls are for the auto sector:
- 25% of car buyers first contact a dealer by calling (Kelley Blue Book)
- 61% of car shoppers contact the dealership after a search by calling (LSA)
- The average internet shopper spends 13 hours researching cars online (J.D. Power)
- 58% of consumers shopping for auto parts say they called after a search (LSA)
- 56% of consumers shopping for tires say they called after a search (LSA)
Consumers call with questions about inventory, pricing, and business hours, and schedule test drives, and to purchase parts. Clearly, potential vehicle and auto parts customers are using the phone as a key part of their conversion journey.
So consumers are calling—but are they becoming sales? Data from a DialogTech study analyzing millions of calls found that 19.5% of calls to dealerships from search go unanswered on weekdays; on weekends, this percentage goes up to 31.8% unanswered.
Even if calls are picked up, they’re not always handled the best. A study by Dealix found that up to 72% of dealership agents don’t ask callers for an appointment.
When marketing budgets are tight, no calls or clicks should be wasted opportunities. It’s imperative to ensure that your marketing campaigns and representatives are making the most of every lead. That’s where conversation intelligence comes in.
The Importance of Conversation Intelligence for the Auto Industry
Conversation intelligence solutions help auto marketers increase revenue by making calls as measurable and optimizable as clicks.
Calls don’t have to be a black box. Wondering what marketing channels, ads, or search keywords drive the most high-quality sales calls? What digital ads a customer has seen before calling? If the call was answered by the dealership or call center? If you are wasting ad spend generating unanswered calls? If your BDC or call center agents are actually converting your calls? Conversation intelligence provide answers to all these questions and more.
A conversation intelligence solution can give information on what channel, ad, search keyword, and webpage drove a customer to call. Your marketing team gets a recording and transcription of your conversation. Plus, AI and machine-learning algorithms analyze what’s said to determine if you are a sales lead, if your call resulted in a conversion, how the sales agent performed, and much more.
Your auto marketing team can use call analytics to more accurately measure performance across channels and make the right optimizations to drive better calls and convert more callers to appointments and customers. AI-driven insights into what happens on each conversation help you retarget audiences with the right ads, build better-converting lookalike audiences, adjust your keyword bids for what drives the most revenue, and more.
Ready to learn more about how conversation intelligence can transform your auto marketing strategy? Download our DialogTech for Auto Sales toolkit.
Ready to learn more about how conversation intelligence can transform your auto marketing strategy? Download our DialogTech for Auto Sales toolkit.Download My Toolkit