Automotive Brands Offer Early Road Map For Location-Based Marketing

loren-hillbergData-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Loren Hillberg, president and general manager at Thinknear by Telenav.

Automotive marketing has long been organized into three well-established tiers, comprising a system that offers interesting lessons for other industries.

Brands make up the first tier, followed by regional dealer groups in the second tier and individual dealers in the third. Historically, each tier is responsible for its own portion of the marketing funnel, with distinct tactics to reach customers throughout their purchase journey.

Automotive marketers were early adopters of location-based mobile advertising and have effectively leveraged different data and different creative strategies across each tier. For example, tier-one brand strategies focus on location-based demographic targeting, with video and rich media creative to build brand awareness.

Meanwhile, the regional dealer groups that make up tier two often veer toward regional location targeting strategies with incentive programs, designed to highlight large scale sales events and increase consideration. And the individual tier-three dealers tend to leverage proximity targeting, while emphasizing dealer locations, conquesting and local inventory in an effort to close the transaction.

I believe major consumer brands upping their investments in mobile advertising can learn from the auto vertical’s use of location data to better link their targeting and creative strategies. This will ultimately create a better brand experience for consumers.

Tiered Marketing

Brands in the consumer packaged goods (CPG) industry, for example, could be prime candidates to take advantage of the auto industry’s tiered marketing approach.

At the top end of the funnel, CPG marketers may apply a tier-one strategy to create brand awareness in crowded categories that often include incumbent heavyweights. Top-of-funnel marketing is often mistakenly associated with a lack of targeting, but mobile marketing actually provides marketers with great tools to deliver brand experiences to a core audience.

Demographic and life-stage targeting based on home neighborhood traits allows for segmentation, and marketers can deploy campaigns featuring rich media or video to build awareness through mobile engagement. Due to the significant growth of on-screen time for mobile devices, these campaigns can be operated at scale with great reach.

The strategy looks different from the tier-two perspective. Here, CPG marketers can leverage location-based behavioral data to drive purchase consideration. Mobile location data can identify consumers who visit specific categories of stores or brands. The data can be used to create specific audiences based on consumers’ real-world behavior. Creative at this level often focuses on product circulars highlighting promotions, new features or core product line extensions.

For lower-funnel tier-three tactics, CPG marketers can focus on driving in-store purchases and reaching in-market consumers based on their proximity to a store location. A common tactic, for instance, is retargeting consumers who have visited stores where the product is available for purchase. Ad creative at this stage should center on value exchange with the consumer. Supplying product information, coupons or directions to the nearest store are all proven strategies.

Advantages To Tiering In Non-Automotive Industries

A major advantage to the tiered approach for non-automotive brands is precisely how seamless and sequential the approach can be. Unlike automotive tiers, which rely on wholly different organizations and budgets across the path to purchase, a non-automotive brand can approach each “tier” as part of the same campaign and under the same budget. This can lead to greater continuity and fluidity of messaging across tiers – something that the automotive industry can find challenging when different parties are calling the shots along the way.

As the mobile space continues its rapid expansion, marketers are hungry for frameworks and tools to improve campaign effectiveness. The one-size-fits-all model that has been used to test mobile must now give way to more thoughtful and comprehensive strategies and tactics. The most successful marketers are spending the time and money to ensure that targeting strategies and campaign creative are closely aligned for each step in the path to purchase. Automotive has paved that road – bad pun intended – and now other industries can learn from its early efforts to maximize their ROI opportunity.

Follow Loren Hillberg (@lhillberg), ThinkNear (@Thinknear) and AdExchanger (@adexchanger) on Twitter.

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1 Comment

  1. Great outline of the different tiers and how advertisers should think differently about messaging and targeting!