Targeting advertising efforts to better serve a desired audience, increase efficiency and maximize ROI is an age-old advertising technique, to say the least. But targeted automobile advertising?
While the concept may seem something that won’t materialize for some time, in actuality it may be closer than you think. In fact, it’s something that more companies — specifically automobile companies like General Motors and others — are considering in an effort to find ways to monetize and create more value from the dearth of customer data they process on a regular basis. Consequently, it’s only a matter of time before that data is sold to brands, which in turn, will leverage it to create highly-targeted, ads to broad and diverse audiences right in their cars, trucks and SUVs.
The Dawn of Targeted Automobile Advertising
The concept of targeted automobile advertising started to gain momentum with GM’s radio-tracking initiative in late 2017. In this experiment, the company tracked the radio listening behavior of 90,000 drivers in Chicago and Los Angeles over a three-month period. During this time, they compiled and evaluated a wide range of consumer data that included radio volume, driver zip code, and station choice, leveraging the cars’ WiFi signals to upload the data to GM’s servers.
The data was analyzed in an effort to compare and cross-reference the audio content that consumers were listening to, with what they were buying and where they were eating, shopping and going for entertainment. Once it was determined that certain consumers were regularly visiting a specific business, advertisers could then place targeted ads directly onto the radio being listened to by the desired audiences. They could also hone in on consumers who were more likely to patron certain businesses, based on what they bought and the places they visited.
But even in light of these findings, how realistic is it for consumers to fully accept that their car might listen to their music and conversations or track their data? The short answer: it’s a distinct possibility. For one, it’s well established that radio station ads currently don’t have much relevance to listeners — often because stations are assessing their audience incorrectly. Ultimately, this represents a slew of missed opportunities for both consumers and advertisers, as well as lost revenue for stations. Broadcasting relevant, user-specific ads addresses this challenge — when consumers hear ads on the radio, chances are they’ll stay tuned in, especially if the ad gives them information pertinent to their daily activities. And they’ll be less likely to turn the dial during the commercials if they end up discovering a new place to visit or a helpful product from the ads they hear in their vehicle.
What’s more, we’ve pretty much accepted that websites and mobile devices track our every move. And it’s likely that we’ll eventually accept that the same technology placed in cars will eventually track keywords, radio stations and location data. By applying AI and data science, brands can then strategically leverage the information they receive to determine what matters most to drivers and passengers. Equipped with this data and resulting analysis, they will have deeper customer insights about the right audiences, and subsequently be able to target them more accurately. And if consumers ultimately have a better shopping experience, then chances are even greater that they’ll accept that their cars track their data the way they have accepted it everywhere else.
Radio: The New Channel for Consumer Data
Now, in order to directly funnel targeted automobile advertising into cars, brands will likely have to invest in an already existing medium that users will be accessing while driving — and the logical choice is radio. It goes without saying, however, that as commercial-free app streaming services have increased in popularity, radio audiences have dramatically changed and even declined. But despite this metamorphosis, radio still has the ability to gather mass audiences and keep them captive, often in locations like the office, the dentist or their vehicles. Around 90 percent of Americans over the age of 12 listen to AM/FM radio at least once a week, according to a 2017 Nieman Journalism Lab report, with the vast majority of that audience listening in their cars. And despite a radio industry in flux, that statistic has only declined about 2 percent since 2009.
Data also gathered from automobiles is perhaps more accurate — and thus more valuable — than many other types of data. For one, it’s immediately applicable. Advertisers can find out what people listen to, cross reference that data with where they shop, and then target those consumers with ads for similar businesses and related goods and services. Targeted automobile advertising could potentially be for a business that consumers are passing while they’re driving, or that are located within close proximity of their destination. In addition, these consumers are also mobile. If they’re taking the time to drive while doing errands or shopping, chances are high that they’re already in the right mindset to continue buying.
Targeted Automobile Advertising and PPC: A New Opportunity
Another nascent opportunity for targeted automobile advertising is that it can work in tandem with your PPC strategy. In general, radio ads are designed to target massive audiences running a wide range of demographics. On the other hand, SEM is aimed at connecting advertisers with specific and targeted groups. Combining these strategies, however, creates the best of both worlds — as well as the potential for even higher ROI.
Ultimately, PPC is about bolstering sales and generating new leads for the advertiser, while also increasing relevance to the customer. Potential buyers search for products and services online, and advertisers have the ability to display a targeted ad for that product or service at the exact time and place that users need to see it the most — when they’re considering a purchase and weighing the pros and cons.
Thus, radio can be a critical instrument — and catalyst — for executing on and achieving these PPC goals. Specifically, radio can a critical factor in retargeting. Brands can elevate the results of their PPC campaigns by determining if a consumer heard a radio ad for their product, and then redouble their efforts by targeting an ad at a user for that same product when they’re back online, magnifying the product’s exposure.
A radio ad can also feature a well-placed target keyword and mention it repeatedly, which in turn helps users remember and associate that particular word with your brand, while also enabling them to easily find it in online searches. For example, radio ads can feature memorable jingles for a product that a consumer might be considering at an electronics store or a retail clothier that they visited while doing errands in their car. That ad from the same merchant can then reappear leveraging the same keywords online, reminding the user that they can easily make that purchase with the click of a mouse.
A Look Ahead: Targeted Automobile Advertising and Brands
For now, targeted automobile advertising remains a concept — simply because GM and other manufacturers aren’t “licensing” consumer data — at least, not yet. But that day is likely coming and brands can set the stage for its eventuality by better understanding their target markets. That means assessing the type of music their customers enjoy and the radio stations they listen to, laying the groundwork for AI and data science technologies that have the ability to further analyze the data, which advertisers can then use to their advantage.
While it still has yet to become a reality, it’s lost on no one that licensing consumer data will be lucrative for car companies going forward. And if properly implemented, it promises to be a winning proposition for radio stations and car companies alike — car companies will be crucial in helping brands deliver their message through new channels and reach new audiences, which will result in highly-targeted and more relevant ads on the stations being listened to. Consumers, who will stay tuned, will have opportunities to learn about more the brands and products that they need and are truly interested in buying.
But perhaps the biggest winners will be the brands themselves, which will have an ability to get in front of new and diverse audiences. Integrating new advertising approaches introduced by radio with their existing PPC strategies will only increase the value and efficiency of their campaigns while also maximizing returns. The possibilities are almost limitless. And while radio advertising might seem like an unconventional means of ROI, combining it with unique and creative PPC strategies can breathe new life into old methods, opening up new buying opportunities for consumers and new streams of revenue for brands.