How social media drives down the cost of putting drivers in new vehicles
Social media drastically reduces cost per lead in the automotive industry. Add to this, the fact that 2017 will see the CMO under increased pressure to directly impact bottom line. Given these two drivers, it’s hard to understand why the automotive industry vertical in emerging markets, as well as their first world counterparts, has not embraced social media marketing with more gusto.
The report, “The CMO Shift to Gaining Business Lift” explores the evolving role of the CMO as a growth driver within businesses. At the same time, we’re seeing stronger and stronger evidence towards a reduced cost per acquisition and cost per lead rate on social media platforms.
We know that shoppers use social as a research tool – the extent to which it is used is often underestimated by marketers. The automotive industry in developing markets, and indeed, first world counterparts, has a long way to go before realising the full potential of social media as an adjunct to its sales channels.
Social media platforms are used to not only weight up peer reviews and research brands and models, but with time spent on Facebook far exceeding time spend on any of the search engines, both vehicle manufacturers, and vehicle dealerships, are quickly learning the value of social campaigns to sell more cars, grow their businesses, and engage with a captive audience.
More intensively, and according to a 2014 CMO Council report:
- 38% – consumers will consult social media in making their next car purchase
- 23% – car buyers use social media to communicate their purchase experience
- 84% – car buyers use Facebook. 24% use Facebook as a resource for making their vehicle purchase
- 40% – new car purchases over the next 10 years will be made by millennials
- 94% – millennial car buyers gather information online
In the report, the CMO Council acknowledges that “marketers believe that social can profoundly influence preference and purchase” however, the council highlights a serious lack: “marketers need to take the next step by integrating social more directly into the sales funnel, as well as using it as a platform for delivering qualified leads. If a key responsibility of marketing is to help prime, fill and accelerate the sales pipeline, marketers need to take advantage of some of the inherent qualities of social…”
The case for the social embrace
With the recent launch of its V40, Volvo South Africa sought to drum up interest and generate high quality leads. The organisation turned to social media. The results of the campaign present an almost perfect case study for an industry that is clearly directed by socially influenced decision-making.
To meet Volvo’s pre-determined campaign objective of generating high quality leads, a campaign using a range of targeting criteria was conceptualised. “Social media’s ability to target specific audiences and to help brands reach specific objectives is unparalleled for the same value on any other medium,” says Gil Sperling, CTO at Popimedia.
89% – decrease in cost per lead in comparison to previous conversion campaigns
20% – lower cost per lead using Website Custom Audiences
1049% – above KPI for number of leads generated
Social is science. Decisions are made based on big data analytics, language processing, and algorithms. The automotive industry gains a deep understanding of perception, can determine accurately its most appropriate audience, and target that audience correctly, powerfully, and effectively. Volvo South Africa discovered that creating personal, targeted messages perfected its outreach in launching the V40 to the local market.
And then what?
Here’s the thing about social media – it’s a relationship. It’s about the customer experience and intimacy between the brand and the customer. Based on the strength of this relationship, and the trust it holds, marketers are given the chance to upsell and cross-sell, while learning about the client all the while. What we know already is that if your Lead Ads are integrated with your CRM system, a conversion is seven times more likely. What this also means is that we have the ability to continue communication, in a highly relevant and targeted manner. When social is used correctly, we can build loyalty, brand love, and long-term, on point customer relationships.
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