There have been many shifts in the automotive category in recent years. Production plummeted in 2020 and 2021 due to the COVID-19 pandemic, semiconductor chip shortages and supply chain issues. Despite the many challenges that are persistently plaguing the auto category, there are also many opportunities.
Below is a highlight of the trends driving the increasingly dynamic and nuanced automotive sector.
#1. Electric vehicle adoption is on the rise
Consumers have become increasingly focused on sustainability and the environmental footprint left behind by brands. Global Web Index shared that 72% of consumers are now more sensitive to the environmental behavior of companies than they were before the COVID-19 pandemic.
As a result of evolving consumer preferences, government incentives and environmental regulations, more people are purchasing electric vehicles (EV). In 2021, EV sales more than doubled to 6.6 million, representing close to 9% of the global car market and more than tripling in market share from two years earlier. In fact, all the net growth in global car sales in 2021 came from EVs.This upward trend in sales is expected to continue. EVs are projected to account for 45% of the market in 2035, up from a forecast of 32% in 2030. This growth presents many opportunities for auto marketers to reach EV buyers across their consumer journey with personalized advertisements that encourage them to explore your brand.
#2. Digital dealerships are the future
Another trend to emerge recently is the digitization of the auto category. While many auto brands have traditionally also offered a digital experience, consumer adoption accelerated significantly as a result of the pandemic-induced behavioral shifts.
In fact, 61% of car buyers are now open to buying online, which is almost twice as many as before the pandemic. Not only are auto buyers turning to digital showrooms, but they’re also using their mobile devices to navigate their vehicle buying journey. Ipsos Media revealed that 71% of vehicle buyers use mobile at some point during the purchase process.
I recently attended the 2022 Automotive Forum in New York and the most widely spoken topic during the event was the significance of the digital retail experience. It’s clear how important it is to understand how consumer buying behavior is evolving and why it’s crucial to meet consumers where they actually are – online. Whether it’s offering a digital showroom, providing home test drives, or delivering vehicles directly to the consumers’ door, it is vital for auto brands to facilitate a seamless online experience.
#3. Video is invaluable
It’s clear that today’s auto buyer’s consideration set has changed. The lead time from research, to test drive, to purchase isn’t what it once was. Auto buyers’ decision-making is now dependent on many additional factors. In order to support customers across their purchase journey, video is invaluable.
Over 75% of auto buyers say that online video has influenced their shopping habits or purchases. Marketers can leverage video in many ways. My suggestion would be to create content around five key research steps, including walk-arounds, feature highlights, reviews, test drives and safety tests. Allow customers to conduct their research by simply hitting play, and of course, ensure the video content is optimized for mobile.
With video playing such a vital role in an auto buyers’ research, there’s an increasing opportunity for marketers to reach potential consumers with dynamically personalized video advertising. McKinsey shared that 76% of consumers believe that receiving personalized communications is a key factor in prompting their consideration of a brand.
To learn more about how personalized advertising can support your auto brand, feel free to reach out to me directly: kherb@a.ki
Katherine Herb, Senior Sales Director-Automotive Lead at Aki