U.S. auto companies and dealers accelerate their online ad spending
Though later converts to online advertising than other consumer goods segments, auto manufacturers and dealers are becoming big-time spenders of banner ads, paid search, sponsored e-mail campaigns and other forms of interactive advertising, says a new research report from eMarketer Inc.
The research firm estimates that auto companies will spend $2.7 billion in total online advertising in 2007, compared with $1.4 billion in 2005. By the end of 2007, the auto industry will account for 15% of total U.S. online advertising spending, according to eMarketer.
"The automotive industry is the largest advertiser in the world. In the U.S. alone, the industry spent more than $17 billion in the first 11 months of 2005," says eMarketer senior research analyst Lisa E. Phillips. "Despite the fact that almost 70% of consumers use the web at some point in their automotive purchases, the industry has been slow to commit to online advertising and promotion." Phillips estimates that auto companies and dealers will spend about $1.95 billion on various forms of online advertising in 2006.
EMarketer notes that examples of auto companies effectively using online advertising strategies include Audi and Volvo sponsoring National Public Radio podcasts. "The industry`s foot is definitely coming off the brakes and onto the accelerator this year," says Phillips. "Automotive advertisers are gearing up for an online advertising surge, but it`s going to come at the expense of other media."
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