Study: Car Dealers’ Ads Are Total Wastes Of Money

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If you’re like most consumers, you ignore car dealership commercials because most are so obnoxious. But new consumer research begs to differ – not that you ignore the radio and television spots, but why. According to a C+R Research study, the problem is the medium, not the message. “Auto dealers are wasting their money on advertising, especially radio, TV, and direct,” MediaPost reported September 29, because, says the study, “[c]onsumers find them neither helpful or trustworthy.”

The biggest, most trusted and most helpful influencers, the study claims, are websites – manufacturer websites, expert review websites, independent research websites, newspaper websites, and search engines, which take you to still more websites. Nearly half of the 1,000 respondents – 49 percent – said that search engines are influential, with 46 percent claiming to be influenced by manufacturer websites and 42 percent by dealer websites. Respondents also said they preferred independent websites where they can find side-by-side comparisons of vehicles and dealerships.

These findings no doubt pleased Cars.com, which sponsored the survey and just happens to be a website.

But several flaws in the study’s structure suggest that the sponsors should perhaps curb their enthusiasm.

One is that the survey was conducted completely online. Had it been conducted by phone, it could conceivably have reached consumers who weren’t so prone to be online so much of the time, and results might have been different.

Another is that it apparently deals with consumers who already have a mental short list of makes and models they want to research. “Consumers can be overwhelmed by automotive content, but rather than tune it all out, they’re selecting the pieces that are most valuable to them,” said Simon Tiffen, senior manager of advertiser insights at Cars.com, the study’s sponsor. That selection process continues when shoppers go online, but it starts before then.

Still a third, related, flaw in the study is that historically, consumers don’t like to admit to being so gullible as to be influenced by broadcast commercials, so they often lie about it – to researchers, to themselves, or to both. As commenter David Grism of Exact Media noted,

As a marketer I’ve long know if you ask consumers whether TV ads influenced their purchase decision (especially in mature categories and major purchases like cars), they will overwhelming say “no.” Think about it. Few people will say, “I saw the great new Volkswagen ad, so I went out and dropped 30 grand on one!” Instead, they’ll attribute their purchase to a very rational and data-based process of scouring expert reviews, independent research sites, and the like. This study is flawed, and almost certainly understates the impact of advertising in influencing buying decisions (and over-states [sic] the impact of left-brain pursuits).

Which brings us to the fourth flaw – assuming that buying a car is a perfectly rational decision. As a high-cost, high-commitment purchase decision, car selection should be based solely on reason and logic. It should be, but, like buying a house (an even higher-cost and higher-commitment purchase decision), it isn’t. That’s where good advertising, usually at the manufacturer level, and experience – having owned a make of car or having driven it at the dealership – and, as the study itself notes, “just noticing a car on the street” come in.

So if you’re a car dealer, work on that website of yours. Build up those incoming links from trusted websites, sponsored-link campaigns and SEO programs to increase your search engine visibility; after all, “68 percent of respondents said they used online sources to fine [sic]” dealerships, the study notes.

But before you prematurely scrap your radio and television advertising, you might try making it just a little bit less obnoxious.

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