Article

Tim Biddiscombe
Tim Biddiscombe 6 May 2022

Automotive Chips and Dips

Automotive (micro) chips and (sales) dips: How the latest trends in marketing automation can help the automotive industry bounce back. Way back in the last millennium, as a fresh-faced graduate I wound up working for TUP Global, an innovative start-up, based North of London that created marketing reports for automotive franchises, long before it was cool, and long before it was easy.

We consumed data from all the major automotive brands, by way of a little black box modem that sat between computers and printers in the offices of dealerships, and they were frequently kicked over, tripped over and unplugged.

On a good day however, data for new car sales, parts and servicing flooded into TUP from all over the United Kingdom where it was collated, aggregated and summarised back as epic MIS, way ahead of its time.

Looking back, it was an amazing grounding for me in the complexities of large-scale data processing, deduplication and hygiene that has stood me in great stead in the decades since.

As I look at the modern automotive industry, I’m struck by, and empathetic to the challenges the brands face, and as my career direction has taken me deeper and deeper into the fascinating world of enterprise-level marketing automation, I find myself wondering whether the lessons I have learned, the myriad marketing technologies, processes and services I have created or implemented over the years could be brought to bear.

Automotive Data and it’s Numerous Sources

Along with almost every other industry, the amount of automotive data available for consumption by marketing technology has exploded, and traditional solutions for data storage and access have failed to keep up.

This is where a Centralised Data Platform (CDP) can be the answer to your prayers.

A cloud-based platform that will draw in and aggregate data from numerous sources, infinitely customisable, with the ability to add in new channels as they appear, without the need for lengthy IT projects that result in systems that require ongoing support and maintenance – doesn’t that sound like something you could do with?

Dealership Level Marketing

For as long as there have been car franchises operating regional dealerships, there have been challenges to overcome regarding engagement at the local, or dealership level.

It is a common enough problem among multiple industries, including retail, where some Head Offices struggle to overcome the ivory tower perception, and without changing that mindset, it can be difficult or impossible to persuade local dealerships, often franchisees with only a tenuous emotional connection to the mothership, to support your endeavours beyond hitting their sales targets.

Many of the modern leading marketing automation providers, including all the technologies we work with (Acoustic Campaign, Adobe Experience Cloud, Salesforce Marketing Cloud and HCL Unica) offer regional solutions to de-centralised problems.

Individual dealerships with the power to initiate their own marketing campaigns, using approved branding can influence greatly their ability to close business with the prospects who walk onto their forecourts.

The Automotive Calendar – Acquisition or Retention?

Another well-understood occurrence in the automotive calendar is the decline of new car sales during the winter months. Traditionally, new models are introduced in the autumn, which can explain the waning sales.

But it runs deeper than that, in the spring and summer people are outside their houses more, using their vehicles more for recreation, beyond work and taking the kids to football practice. I suspect even deeper explanations exist that would stray into the realms of psychological states such as Seasonal Affective Disorder.

Now, there’s only so much you can do with the deep causes, but I’ve always been a fan of treating the symptoms, applying a CBT approach if you will.

One lesson it took me way too long to learn is the swings in focus sales driven organisations must take when faced with external economic factors. Put simply, when the good times are here, focus on new business, when belts are being tightened, its time to focus on retention.

That’s not to say that either focus should exclude the other, after all its always cheaper to keep a customer than it is to acquire a new one, no matter the industry, but it does speak volumes for how we should prioritise our marketing activities. In the context of automotive, it is the difference between devoting your time to:

  1. Looking for brand new prospects, who are maybe considering a switch from another franchise, or their age and income have risen to the point where they are able to purchase their first new vehicle (to list just a few of the myriad segments of customers it is vital to pinpoint).
  2. Looking at the old customer base to see who hasn’t come in for a few years, start picking up the phone or sending some SMS messages (more on this later) to generate some new leads.

Rising Above the Challenges of the Industry

On top of all this, automotive has suffered from an increasingly competitive market, upcoming upstarts like Tesla have been stealing the hearts and minds with the first commercially viable electric vehicle, and now many of the other manufacturers are following suit.

Prices being driven in only one direction, and it isn’t skyward, notwithstanding the microchip shortages currently plaguing the market.

When it comes to share of wallet, I always say you can’t go wrong with looking at the world of online gaming.

You might think your competition is fierce, but in online gaming, where the average active player has upwards of six accounts with different providers, every day, hour, minute and second counts in terms of brand awareness, demonstrations of value and customer loyalty.

Who, how, what and where are your friends here.

  • Who are you targeting, in terms of customer groups and segmentation? I would always argue that in the world of digitally savvy customers, if your segments contain more than a hundred people without varying the personalisation even slightly, then it isn’t being done right.
  • How regular is your communication? Customers like a certain cadence, and timing is everything. You want to time your message for when a customer is going to be most responsive, which if you’ve ever spoken to them before, is available, deep in the data…
  • What are you offering them? As I mentioned, offers are key. Optional extras (microchips again notwithstanding), service contracts, aftercare, there are numerous elements at your disposal to tempt a prospect into a visit and a test drive.
  • Where are you talking to your customers?

Which brings me onto my last point.

What channels do you prefer to use when talking to your customers? Email is one of the cheapest out there, but how many of your customers will read your emails? Some, I’m sure, but are you reaching enough? Are you reaching the right ones? The ones closest to making a decision in your favour?

It is commonly understood in automotive circles that SMS is the most responsive, and with good reason when you bear in mind the lifestage indicators of a majority of automotive purchasers – they sure as anything aren’t responsive on Facebook Messenger or Tik Tok.

However, there are other alternatives out there that you may not have considered, that could be giving you additional routes to market, and letting you time a message into an inbox at a critical moment of decision that could make all the difference.

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