The automotive industry was hit by a Mack truck the second half of 2008 with all-time high gas prices, a shrinking economy and growing consumer fear of making a large purchase.  Advertising spend reflects how the automotive industry reacted to the crisis, highlighting channels that are the most vital to intercepting new vehicle prospects.

The first half of 2008 showed growth in advertising spend over 2007 for TV (+2%) and Internet (+55%) while outdoor, magazine, radio and paper decreased (20%, 18%, 14%, and 4%, respectively).  The second half of 2008 yielded a lower advertising spend over 2007 across all channels.  Radio and paper took the biggest hits with decreases of 42 percent and 40 percent, while Internet exhibited a similar level of spend vs. 2007 with only a 0.5 percent decrease.  Overall automotive advertising spend decreased 8.2 percent from 2007 to 2008, with the Internet being the only channel to witness growth.

Automotive Estimated Ad Spend: 2007 – 2008

Trended on a monthly basis, automotive Internet advertising was outpacing 2007 until October 2008 when the brakes were applied and it dipped below 2007 levels for the first time.  Automotive Internet spending in 2007 represented 4.6 percent of total Internet spend rising to 5.9 percent in 2008.  Acura, Hyundai and Subaru contributed the largest increase in Internet spend from 2007 to 2008 while Mercury, Volvo and Jeep had the largest decrease.  Thus far, Internet spend for 2009 is once again gaining momentum and is forecast to be on par with Q1 07 while still slightly below Q1 08.

Auto Internet Ad Spend As % Of Total Internet Spend

The Internet is proving to be a critical strategic channel for automakers and we anticipate the trend to continue.  Although TV continues to represent roughly three-quarters of total advertising spend, the Internet could likely become the second largest advertising channel by 2010.  The key to successful Internet spend in 2009 will be identifying where your target audience goes online and interjecting yourself at the right moment in the vehicle purchase funnel.

Results of an initial survey conducted during two weeks in late June show that DMG’s 4,110 multimedia displays on four Shanghai subway lines were viewed by 3,055,000 passengers.

DMG and Nielsen will track multimedia subway display viewership on a regular, long term basis in China.

Recent outdoor campaigns that drew notice include a glass elevator in Manhattan painted to look like a giant Oreo dunking into a glass of milk and “pitvertising” in London by Right Guard. 

Such high-profile public pranks may be par for the course in an era defined by ad-savvy, often distracted consumers, Pete Blackshaw, Executive Vice President of Digital Strategic Services, Nielsen Online, told the Times.

“Advertisers are being pushed to creative extremes, partly because it’s just so difficult to get consumers’ attention these days,” Blackshaw said. “It may just be a flash of brilliance that everyone pays attention to, and it gets that huge return, but it’s very difficult to replicate on a regular basis.”