The automotive industry, which has embraced programmatic buying of display ads, will increase and extend its investment in programmatic in 2014, according to a new eMarketer report, “Driving Programmatic Buying: Automotive Industry Will Invest Big in 2014.”
The next stage of programmatic growth will mostly depend on breaking down some of the traditional walls between original equipment manufacturers (OEMs), regional auto dealer groups and local dealerships. As with search advertising, which has been a notable area of cooperation among the three tiers of auto marketing, so too will programmatic depend on coordinated efforts among all three groups.
Given the size of potential customer pools and the gaps between Tier 1 (national), Tier 2 (regional) and Tier 3 (local dealerships) advertising operations, industry players are looking to realize efficiencies by streamlining cross-tier cooperation.
The widest gap in cooperation, historically, has been between brands and dealerships. And the reasons are structural more than technological. But auto dealers are joining forces—if invisibly—through digital-vendor platforms, which have created tremendous new demand for programmatic campaigns.
While an individual dealer might be too small to support a marketing strategy team that could navigate keywords, signals and KPIs, these middlemen vendors have existing relationships with both the national brands and individual dealers, making a cooperative relationship possible.
Still, dealers remain fiercely independent from other tiers, partly because of the legal mandate that establishes the separation of new-vehicle retailers from new-vehicle manufacturers. While dealers will stay independent of Tier 1 control for the foreseeable future, there are signs that they will begin to cooperate with OEMs for programmatic buys.
The full report, “Driving Programmatic Buying: Automotive Industry Will Invest Big in 2014,” also answers these key questions:
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