Marketing Planning Transformation in the Auto Industry

Car buying is now a hybrid experience, with online marketing playing a decisive role in guiding potential buyers to their preferred choice. By the time they step into a dealership, most people already know what vehicle they want to buy. For marketing planners in the car industry, this means far more attention must be paid to the customer’s online journey.

In this shared virtual/physical world, the function of marketing changes from building brand awareness via big ad campaigns to becoming a key enabler of sales. This will require marketing departments to embrace new planning models that are goal-oriented, data-driven and integrated across several client-facing departments in order to keep prospective buyers engaged at every step of their decision-making journey.

Berylls has identified six key elements for the successful transformation of marketing planning in the automotive industry:

1. Become goal and business-driven.
2. Embrace the entire, complex customer journey.
3. Adopt agile methods for real-time transparency and steering.
4. Create cross-functional standards and collaboration.
5. Introduce a central collaboration platform
6. Become data-driven and fact-based.

All will increase the effectiveness of marketing planning by placing the customer and business goals at the center of marketing efforts, and by adopting data and agile working methods to measure and optimize the performance of marketing decisions and lay firm foundations for further success. 

Breaking old habits

Restructuring marketing departments in an industry that is more than a century old requires breaking a lot of old habits. Every year, carmakers lose billions of dollars in forgone revenues because marketing planning is conducted in functional silos. There is little coordination, and therefore few common goals, across client-facing departments including sales teams, car finance departments and after-sales service, for example. The same problems occur in the industry’s three-tier distribution system of original equipment manufacturers (OEMs), national sales companies (NSCs) and dealership networks. 

Although leading carmakers are beginning to adopt a digital-first customer journey and experience, and are leveraging data to put the customer – rather than the car – at the center of sales efforts (with the right offer, for the right person at the right time and place), marketing planning has not kept pace. It is still too focused on allocating budgets and planning big-ticket items such as Superbowl ads, when it should be focused on achieving goals, and measuring and optimizing performance.

The main problems with the old marketing model are:

• An exclusive focus on brand positioning and big ad campaigns, rather than supporting the business objectives of the carmaker, NSCs and local dealerships.
• An absence of collaboration in this three-tier distribution system, which causes dealers to rely heavily on discounts of between 7% to 20% in the individual consumer segment, and up to 50% in the B2B area, to complete sales. An integrated and centralized marketing approach would reduce the need for deep discounting and improve margins across the distribution system, as well as reduce costs.
• Marketing spend channeled to “old media,” such as TV, magazines and billboards, which no longer engage consumers in a world of streaming services and multiple online distractions and platforms such as TikTok. Furthermore, old media advertising campaigns often lack tools to track the effectiveness of marketing investment – for example, the conversion rate of brand awareness campaigns into sales.
• Similarly, a lack of knowledge on how to get the most out of paid, earned and owned media: for example, a marketing strategy that coordinates paid posts on Instagram, amplifies this with reviews in car magazines written by journalists and reinforces the key messages through good content on the websites of OEMs, NSCs and dealerships.
• The absence of a funnel approach to customer engagement, with poor or conflicting messaging (that silo problem again), disappointing web design and no customer tracking, which all point to the absence of a coordinated digital marketing strategy.
• No methodology for collecting and interpreting data across sales and marketing functions. When standards vary, data is not comparable, which means it cannot be used to drive insights into consumer purchasing habits or the effectiveness of marketing campaigns.

Learning from other industries

Leading companies in other industries, including consumer packaged goods, tech companies and e-commerce giants, have elevated marketing into a core competency. At its heart is a focus on the customer, an ability to track that customer along multiple marketing touchpoints and holistic marketing strategies to keep them engaged.

It is an operating model that integrates strategy and objectives; organization, people and processes; governance and partnerships; and technology and data to underpin it all.

How to transform marketing planning in the automotive industry

Berylls Mad Media has identified six essential elements for the successful transformation of automotive marketing departments. 

The goal of these six Berylls Hexagons is to:

• Make marketing planning more customer-centric, ensuring prospective buyers are fully engaged throughout their journey to a purchasing decision.
• Reverse the focus of marketing departments from brand and market share to strategies that generate sales leads and build brand loyalty.
• Introduce impact measurement to marketing campaigns to allow carmakers to measure the performance and effectiveness of their ad spend.
• Enable data-driven decisions by standardizing data management and collection and using AI to glean insights into customer behavior, preferences and priorities.

Modern marketing planning must achieve the following:

1. Become goal and business driven. Marketing planning must move beyond allocating budgets. It must be able to align marketing actions with business objectives by breaking down business goals into component parts and matching these with the most effective marketing actions needed to achieve each one. Relevant actions include:

• Using sales and business plans as the basis for marketing planning.
• Setting clear objectives for annual strategic marketing plans.
• Allocating budgets and management time to maximize impact of marketing actions and investment.

2. Reverse calculate the entire, complex customer journey to leverage marketing efficiency and customer experience at scale.

• Adopting a funnel approach to retain customer engagement throughout their decision-making process.
• Adopting business and customer experience goals.
• Using data to measure the conversion rate of marketing spend to vehicle sales. It is sales targets that should drive the marketing strategy and not the other way around.

3. Adopt agile methods for real-time transparency and steering, so workflows, campaigns and content are optimized and potential sales opportunities can be seized upon in real time. This will include the use of:

• Establishing dashboards to enable transparent, data-driven business decisions.
• Using real-time reports and consistent KPIs to quickly identify and fix anomalies and adjust actions.
• Providing budget transparency from planned allocations to spending results.

4. Create cross-functional standards and collaboration between departments, regions and partners to coordinate marketing actions, ensure alignment with business goals and eliminate inefficiencies. This will require:

• Integrating stakeholders and partners to plan, manage and reduce iterations and share insights.
• Adopting common standards and language, particularly for the use of data
• Codifying processes and workflows
• Defining role-based access and views for consistency and compliance.

5. Introduce a central collaboration platform to avoid the duplication of efforts and make information accessible to all interested parties. This should include:

• Establishing a central cross-department platform that tracks marketing actions from goal to impact.
• Ensuring the full integration of agency partners.
• Closing the loop from planning to marketing performance tracking to financial systems.

6. Be data-driven and fact based to best predict customer needs and their future behaviors which helps creating personalized marketing for the highest possible return on investment. This requires:

• Establishing one solid database – a single source of facts – to enable decisions based on data and not on gut feelings.
• Adopting standards to ensure a common taxonomy across all departments, locations and stakeholders.
• Creating unique IDs for campaigns or activities to allow individual performance to be tracked.

Berylls Mad Media accompanies clients as they transform themselves into data-driven marketing organizations with a consistent focus on the customer journey. In doing so, we optimize the entire marketing process – from sales and marketing planning to creative content, marketing asset distribution and continuous KPI measurement and improvement. We are a team of marketing specialists from different industries who have successfully guided many clients in this challenging endeavor.

Read the full article on berylls.com