Posted: Tuesday, August 4, 2015 1:15 am
Those two sounds—the “ka-ching!” of cash
registers and the “vroom!” of new autos being sold—are favorites for radio, and
with auto sales hitting record levels, it’s vital for radio to keep a close eye
on its No. 1 advertiser, and find the best ways to keep the dealership ad money
flowing.
Automotive sales will account for $1.75
billion in radio ad spending this year, according to BIA/Kelsey. Estimates from
Kelly Blue Book and Edmunds call for monthly new vehicle sales for July to
reach 1.47 million units, and an annual adjusted rate of 17.1 million. For
July, the eight major manufacturers are expected to show year-to-year gains.
Analysts credit a healthier economy and demand for trucks, SUVs and luxury vehicles with
fueling the positive gains. Indeed, as the overall economy has improved
and unemployment drops, observers say consumers have started to make big-ticket
purchases again, including new vehicles. Particularly in an off-election year,
automotive advertising is critical for radio stations.
The question is: How do you grow radio’s ad
money commensurate with this, especially in a competitive media market? Jim
Doyle, principal of Jim Doyle & Associates, a sales and marketing firm that
specializes in automotive, understands the challenge, while acknowledging that
radio broadcasters are at risk of losing auto ad dollars to digital media as
more clients look to grow their digital ad portfolio. “I would guess that most
of the radio and TV stations are not experiencing record revenue from auto
dealers,” he says, calling it a potential “major issue for operators.”
To put that in reverse, Doyle suggests radio
broadcasters leverage their local relationships with auto dealers and store
general managers (“generals to generals,” Doyle says), adding that stations
need to demonstrate the effectiveness of broadcast advertising.
For example, he says, stations can use a dealer’s own Google Analytics
to show that traffic to a dealership’s website surges after a radio or TV
advertising campaign. “It
is tangible evidence of the power of our products,” Doyle says. On the digital
front, he advises stations to also show dealers the power of a station’s
digital and mobile platforms.
