Advertising Spending Patterns and Predictions in the Automotive Industry
The automotive industry has always been a historic leader in advertisement spending, as international and local car dealerships around the globe depend on their ads to ensure dealership profitability and revenue in sales. As a result, the media and automotive dealerships have developed an inter-reliant relationship that has molded automotive advertising into a dominant category in radio and television.
In 2015, the automotive category spent more than any other category world-wide, with a total of $48 billion, and accounted for about 20 percent of the top 100 companies’ total ad spending. Top ranking auto spenders were Volkswagen ranking fourth on the biggest spenders list, and General Motors ranking sixth.
This spending pattern of automotive monopolization was reflected in San Diego radio spending reports for January 2017. Automotive was reported as the largest spending category, with Auto Factory up +156.7% and Auto Dealers +14.8%. Within the category, Team Kia of el Cajon took up the majority of the monthly automotive expenditure allocating 11.73% of the spending. Honda Dealer Association reflected 10.47%, Toyota Dealer Association 8.45%, and Mossy Nissan 5.85%.
Propelled by strong domestic sales, the industry has also started to see an additional push in digital ads as all automotive tiers are beginning to include digital shares as a significant portion of their ad budgets. More specifically, it is predicted that 60% of the auto digital ad budget will be dedicated to mobile ads. Mobile use and its local targeting options are rapidly becoming a popular advertisement platform, and many of the automotive marketers have taken notice. As a result, we predict auto brands will make their mark in digital like they have in radio and television for years to come!
Radio Market Revenue Reporting X-Ray Support, Miller Kaplan Arase LLP. 2017.