What will be the shape and volume of the car demand to come? The jury is still deliberating, but we can take a fair guess on the impending verdict. Thanks to geopolitical instability and record inflation, vehicle prices are rising, and consumers are wary of making big purchases. It’s a new pothole for auto marketers to tackle, and their best bet is to tweak their spending and strategy to reinvigorate consumers to go ahead and fulfill their dreams.
How can automakers do this? Begin by understanding consumer behavior. How do they decide to buy or not? What factors tilt the scales in either direction?
Boarding the bus of consumer decision-making is critical. It will help auto marketers know the touchpoints. It is no longer enough to market an auto brand; those times are dinosaurian. Auto marketers must build online content highways that allow potential car buyers to cruise along and feel the wind in their hair.
It is also called evaluation. It’s happening virtually because today’s car buyers prefer that experience. Of course, there was a time, and arguably that window is still open when buyers walked into a showroom and put a hundred questions to a car salesman as they touched and felt the car, sat in it, pushed back the set, and vroomed away for a test drive.
However, whether an online or offline evaluation, in today’s digital world, no one will walk into a car showroom without researching the brand online. It is the platinum hour for car manufacturers, and they must seize the moment and reach out to active and passive buyers because the latter may stir into action someday.
So, what does it take to take charge of the moment? It means running the gamut, starting with in-store activities, word-of-mouth marketing, new methods for measuring consumer attitudes, brand performance, and effective marketing expenditures.
Marketers face two kinds of risks if they do not realign spending. First, they could waste money when revenue growth is imperative and funding is tight. Advertising and other investments will be less effective because consumers won’t get the correct information when they need it. Second, marketers can appear out of touch when they push products on customers instead of providing them with the knowledge, support, and experiences the latter requires.
Adapting to new realities
To address the new realities of consumer decision journeys, marketers can implement four kinds of activities:
Prioritize objectives and spending
Typically, marketers focus on building awareness or generating customer loyalty. McKinsey research shows touch points are critical to influencing consumers throughout the purchasing journey: from initial consideration to functional evaluation to the moment of closing a deal.
If auto marketers focus on the ‘funnel syndrome’, they may see wasted efforts. The concept, once the favorite of marketing, is now in disfavor because consumers no longer begin with a large pool of car brands as their initial choice (the funnel head).
They can begin with a few names, then narrow the list and expand it beyond the initial stage. It’s a fluid concept. Therefore, focusing on the funnel head or the funnel pipe is no longer feasible and could lead to devising a wrong marketing strategy.
Marketers need to move away from an overall brand-sell to the meta details that comfort and engage consumers on investment and ROI, sustainability, and reliability, making a consumer’s buck go the distance.
Auto companies will require new messaging depending on which part of the consumer journey offers the most significant revenue opportunity. Rather than addressing weaknesses across all stages, a message may need to address them at a specific point, such as during the initial consideration, the active evaluation phase, or the dealership phase when the actual purchase is made.
Investing in consumer-driven marketing
To educate customers about their brands, marketers must look beyond the funnel. As consumers seek information, reviews, and recommendations during the active-evaluation phase, the Internet is the epicenter of consumer-driven marketing. To perform well in the customer journey, they must shift from buying media to developing properties that attract consumers: digital assets like websites, word-of-mouth programs, and systems that tailor advertising based on context and consumer behavior.
Proctor & Gamble, in the 1930s and 1950s, took to radio and television to grow its presence and message intent. Today, it’s the age of the Internet.
Many organizations find it difficult to enter new horizons boldly. Broadband connectivity is a modern boon. It enables marketers to create useful apps to help consumers learn about products, giving them an online arsenal with simple, dynamic tools to find their product choice. Ford’s car configurator and American Express’s card finder, for example, sort options visually and quickly with each click, making life easier for consumers.
Marketing must eavesdrop on online conversations about brands, analyze the conversations and join in to influence online word-of-mouth. A content management system and an online targeting engine allow marketers to tailor advertisements to context, viewer behavior, and real-time promotion.
Digital marketing has long promised this, but now it must do it.
Winning the in-store battle
Consumer psychology is gold for marketers. The in-store consumer decisions that convert as a purchase depend on various inputs: look, feel, emotion and aspirations. Up to 40% of consumers change their minds because of something they see, learn, or experience at this point, such as packaging, placement, and sales interactions. It is critical learning that escapes some marketers.
Consumers enter a store with a firm grip on their initial consideration set, and it takes a mix of strategies to make them see beyond it – great packaging, favorable shelf position, practical fixtures, and informative signage, or the equivalent of these, depending on the product. In-store audiences are a captive species, and only an excellent strategy can them convert into buyers.
Integrating customer-facing activities
In many companies, different parts of it handle customer-facing activities. These include informational websites, public relations, and loyalty programs. Several executives are responsible for each aspect and do not necessarily mesh as an intra-company team, and they must. They must make fundamental changes to their working style, and CEOs and chief marketing officers must be able to see all customer-facing activities from a comprehensive point of view.
While a CMO focuses on brand building, advertisements, and market research, the full scope of the consumer-decision journey demands they go beyond traditional roles. They must paint a broader canvas that aligns marketing with the realities of consumer decision-making, intensify efforts to shape companies’ public image and develop new marketing capabilities.
Managing customer experience in the automotive-insurance industry requires many skills. Marketing organizations need to integrate customer-facing activities with firm organizational support to increase the percentage of active loyalists and prevent passive ones from being enticed by rivals. An analysis of customer data identifies active loyalists, highlights the causes behind loyalty, and informs how to harness it.
Organizations must have a strong ‘voice of the customer’ that echoes across advertising, public relations, product development, market research, and data management. Bringing these activities together is difficult but necessary, and the CMO is the ideal person to do it.
Consumers’ research methodologies and product purchases have undergone profound changes, and marketers are aware of it. Failure to join the evolution can widen the customer-marketer divide, leaving the gap for rivals to step in with their cohesive campaigns and content.