Investing Advertising Budgets for Automotive Accounts

The Scientific Approach

To Determine how best to allocate any advertising budget …

first identify any waste.

“50% of my advertising budget is wasted – Trouble is-

I don’t know which half.” -John Wannamaker

Truth is your waste % maybe between 50% and 80%. YOUR BUDGET

% OF WASTE EVAPORATES

Problem One

Every Medium has a different way of measuring their audience

Newspaper & Magazines........(ABC) Audit Bureau of Circulation

Radio / TV ................................................................................Nielsen

Outdoor ..........................................................................Out of Home

Direct Mail ..........................................................“Return to Sender”

Internet ..........................................................................Impressions

Every medium and its respective audience suffer from not being effectively pre-qualified.

How the audience receives their information and geography isn’t enough.

Theory

Your advertising is an investment to deliver a message to a target audience. (people/population)

Not everyone is properly pre-qualified.

Rather then delivering a messageto a target audience, choose insteadto deliver to a target household.

You can get critical household counts for the following:

Any Zip CodeAny Area of Interest

Anywhere in the Country

This can be compared to anygeographic map presented by any medium.

Print—CirculationRadio—Listenership

TV/Cable—ViewershipOutdoor—Traffic CountInternet—Impressions

You are now able to compare all media investments

to each other.

Household count is the common denominator.

Then compare media household(s) to Automotive Sale(s) households

for any geography.

2011 Census NJ Population 8,800,000

2011 Census NJ Household Count 3,500,000(Driveways)

2012 NJ Car NJ Dealerships 474Auto Outlook New Car Sales 440,000

Used Car Sales 210,000Total Sales 650,000

Ratio of Households to Dealership Sales New 1:8Used 1:16Total 1:5

Math on NJ Dealer Sales

Statistical Probability of any Medium’s audience (household count) to purchase a car

thru a Dealership in New Jersey in 2013.

1:16*+

One in Sixteen Households will purchase

a Used Car this year.

1:5*

One in Five Households will purchase

a Car this year.

1:8*

One in Eight Households will purchase

a New Car this year.

*Thru a Dealership**Plus approx 200,000 thru private sales & 200,000 thru used car lots.

Math on Traditional Media (A)

Media Audience Budget # of Web AssetsStar Ledger 70,000 $2,800 1 nj.com

Trenton Times 37,000 $4,200

Princeton Packet 19,600 $1,200

Comcast Princeton Zone 59,000 $7,000 1 comcast.net

Plus Middlesex Zone 49,000

Billboard 15,900 $7,000

250,000 $20,000 ($80 cpm) 2

1/5 thehouseholds 50,000 (A) $20,000 ($400 cpm)

Vehiclesper month 4,175

Divided by 15%Est. Honda Mkt. Sales 626

Math on Online Media (B)

Medium Audience Budget # of Web Assets

Video SEO N/A $400 1 (Google)Auto Digital Inventory N/A $1200 30 Websites

300 DirectoriesBullsEye SEM 15,000 $4000 1 (Google/Bing/Yahoo)

Auto Digital Network 250,000 $4500 Up to 150 Websites

Certified Response 45,800 $6000 Network Marketing (Database Marketing)

310,000 $16,000($51 cpm) +340 Web assets

Divided by 2 150,000 (B) $16,000($162 cpm) +340 Web Assets(For any reason)

Aggressively pursue pre-qualified prospects thru their desktop computers, laptops, tablets, smart phones using geo-targeting, behavioral targeting and retargeting.

DesktopLaptopTabletSmart Phone

Traditional vs. Online

Out of the market placeTraditional

(A) (B)

$20,000 per month

$400 CPM

50,100 autoprospects

Web assets 2

Online$16,000

per month(20% less)

$51 CPM(87% less)

+310,000 auto prospects

(500% MORE)

+340 Web assets> 40 auto relevant

> +300 local geography> conquest keywords

> shop inventory

Research

Shop

Buy

Sold

Interest in Traditional Declining

#1 medium for research

GrowingAnd Declining

Position of Dealerships (2 Generations Ago)If I make this investment...how many vehicles will I sell?

Position of Dealership (Renews Generation)If I make this investment...

• How much floor traffic will I log on my up sheets?• How many phones calls can I track?

• How many coupons were redeemed?• How many TV’s did we give away?

Position of Dealership (moving forward)-I want to make an investment to the most pre-qualified prospects one solution at a time, (pending budget

still exists) then adding a 2nd, 3rd, and so on until diversity is achieved and the budget is reached.

-The more pre-qualified the prospect (media solution audience) the better walk-in variable, phone call volume, website traffic, page views, time spent, new visit rate, bounce rate, goals completed, booked service appointments,

parts ordered, coupons downloaded, request a quotes, visits to map/direction/hours page.