Last year I presented a topic that I have great passion for at the Driving Sales Executive Summit.   The presentation topic was “Offer vs Brand Advertising”, and I included a survey question in the introduction to gauge the audiences’ opinion on the right percentage mix of brand vs offer ads for a typical dealership. Surprisingly the most popular answer was 75% brand, 25% offer.  Based on years of looking at dealership ads online, on social media and on TV, I was expecting the opposite.  In fact, even a 33% brand and 66% offer mix would be generous on the brand side. 

 It’s possible that the audience included many people with traditional marketing backgrounds, or that they were responding based on what they thought I wanted to hear.  Either way, the result was unexpected since historically dealerships have favored aggressive offers as their primary means to attract attention and drive traffic.

 The good news for dealerships that care about determining the best mix for their creative is that there are tools and metrics to help find answers based on viewer engagement.  Dealerships that run video creative online or on social media can use the following metrics to compare their ads:

 Click Through Rate (CTR) – Number of people clicking through an ad to a dealership website or landing page.  The automotive industry average for pre-roll videos is .1% - .15%

 View Through Conversions – Number of people that were served an ad impression and then visited the dealerships website within a certain window of time (usually 30 days).

 Completion Rate (50% Completions) – The percentage of people that watch 50% or more of a video ad. The 50% completion rate industry average for a :30 video is 70%

 In my presentation, I shared aggregated performance numbers from the top Cars.com “Fuel” in market video campaigns in 2020.  Branding or customer experience focused ads consistently outperformed offer ads both on social media and in internet pre-roll campaigns.

 Social Media

 CTR – Out of all top performing “fuel” ads, 70% were brand/customer experience focused and 30% were offer focused.

 50% Completion – Out of all top performing ads 77% were brand focused and 23% were offer focused.

Pre-Roll

CTR – Out of all top performing ads 70% were brand/customer experience focused and 30% were offer focused.

 50% Completion – Out of all top performing ads 60% were brand focused and 40% were offer focused.

These numbers debunk the belief that a dealer video ads need an aggressive offers to attract shoppers.  Recent automotive shopper studies, including the 2020 Cox Car Buy Journey illustrate the steps to the shopper journey that averages around 90 days.  Logically, the best and most relevant creative message is the one that matches the shopper’s stage in this journey – product focused ads for those in the research stage, dealer experience ads for those that have narrowed their make and model choices and are looking to shop in person or test drive, and offer ads for those that have several models in mind but a looking to see what best fits their budget.  Dealership website anyaltics show that consumers don’t consistently follow a linear path in their shopping journay, bouncing between new and used models, to pricing and financing information, and then back to other models as they narrow down the best value and lifestyle fit.

Recommendation – Dealers should run both offer and brand advertising while testing the performance of multiple versions of each at type based on CTR, View Through Conversions and Completion Percentage metrics.  Top performing versions of brand and offer ads should continue to run simultaneously to appeal to shoppers in all stages of the buyer journey.