Automotive companies — and particularly the Big Three — are facing challenges as union members from three plants across the Midwest began striking.
For automakers who were already facing remnants of supply chain issues and microchip shortages, a staffing shortage like this creates an even tougher reality. But one hurdle you may not have considered is how automakers’ marketing strategies must shift during a strike.
Here are some automotive industry updates and practical insights into how Big Three auto dealerships — and beyond — can navigate the current industry climate.
How to Strategically Shift Your Marketing Strategies During a Strike
The United Auto Worker (UAW) strike has serious implications for the Big Three automakers, consumers and the economy as a whole. This is made evident by current and former presidents visiting auto plants. If the strikes continue, it could drive up car prices for both new and used vehicles, reduce inventory selection for new car shoppers, and impact repair and maintenance services.
For automotive dealerships across the Big Three and other brands, the UAW strike also impacts your marketing strategy. Here are some insights into how brands can maintain profitability — or even benefit — during the current market situation.
Expect to Stay the Course
Unfortunately for U.S. brands, there isn’t the luxury of simply “going dark” during the strike. Even before the strike, inventory of vehicles was still a challenge. We saw this with the results of COVID-19 and the microchip shortage. Yet automotive companies maintained their marketing through it and were able to bounce back.
The strike poses challenges for the Big Three and potentially positives for other automakers like Toyota, Nissan, and Tesla who are not under UAW rules. For these automakers, the strike comes “at a good time” as challenger brands have an opportunity to apply additional pressure. This is especially true for those who aren’t hampered by inventory issues. For the Big Three, this means staying persistent in their marketing efforts or risk losing market share to competitors.
Protect Your “Backyard” by Maintaining Market Share
From a marketing and media perspective, automotive dealers should place their bets right now on tactics that will drive conversions and website traffic to protect market share. In turbulent times, the goal is to not let customers slip through the cracks. Instead, ensure you’re providing the most tailored message and high frequency of touchpoints to build relationships with truly in-market shoppers.
Despite your current marketing strategy, a tactic shift may be needed to cope with low inventory that will be exasperated by the strike. Media trends and hype aside, market realities require agile marketing practices for dealers to stay ahead of the competition.
Specifically, cross-tier search strategies should be a focus to make your dollar go further as marketing budgets are showing signs of being throttled back. If your dealership isn’t one of the Big Three, leveling up your marketing during the strike will help fill the void and increase your market share in the meantime.
One way to stay top-of-mind is by serving ads to consumers who are actively searching for your competitors. This helps increase your current brand awareness, especially given the fact that younger generations have less automotive brand loyalty and may be open to different makes and models.
Use Search Retargeting
Search retargeting (SRT) should be a complement to your site retargeting, not a replacement. Site retargeting is when ads are served to consumers after they have visited your website. On the other hand, search retargeting is identifying and serving ads to consumers who have actively searched for a make or model and are now visiting other websites outside of the initial search results area.
The addition of search retargeting — when paired with display advertising — is consistently a top driver of conversion rates and site actions compared to site retargeting. From an automotive perspective, these numbers are even higher. Across Goodway’s automotive clients, search retargeting accounted for 14% – 32% of impressions utilized for display. However, SRT accounted for 22%– 46% of all site conversions, making it an outsized performer when compared to broader-based “intent” targeting.
While we don’t suggest a wholesale change, automotive marketing teams should consider short-term adjustments toward the search retargeting channel as the strike threatens to tighten marketing budgets.
Focus on Low-Funnel Tactics
Automotive consumers overwhelmingly turn to search engines to find dealerships and get answers to their questions. 76% of new and used vehicle shoppers run a search before buying. But consumers’ time on search engines overall is small — users only spend an average of 4% of their time on search engines. The rest of their time is spent online on websites where additional advertising occurs. This is why search retargeting and site retargeting pair perfectly to drive awareness and bottom-funnel website actions.
Keep in mind that the recommendation to add SRT to your digital marketing strategy is not in lieu of standard targeting. However, if your dealership is offering minimal sales incentives right now and customers are struggling with high interest rates, the addition of SRT can optimize your audience and budget. This allows you to focus your lower-funnel tactics on customers who are in-market and ready to buy, while your awareness channels keep you top-of-mind with your broader target audience.
Face Automotive Industry Marketing Challenges Head-On
The automotive industry has faced many challenges over the past five years, and the UAW strike is no exception. While strikes are never something you can plan for in your automotive marketing strategy, there are options to shift your tactics to protect or increase market share while continuing to drive bottom-funnel engagement.
Reach out to Goodway’s automotive marketing experts for additional insights into how to position your media mix in today’s automotive market reality.
Rich Powell is the senior vice president – national multi-location sales at Goodway. He oversees the multi-location sector, where his responsibilities include the development and execution of a go-to-market strategy for revenue growth, sales development, marketing and profitability analysis.