Monday, April 07, 2008

Marketing Through Mobile Phones

Dealer Marketing Magazine
by Richard Abronson

The latest NADA report on dealership advertising shows that while Internet advertising expenditures continue to increase as a percentage of a total advertising budget, dealers as a whole are still allocating the majority of their spending to direct mail, newspaper, radio, television, and other types of on-lot or outdoor advertising (NADA DATA 2007). Tracking and conversion reports are becoming increasingly sophisticated for the Internet segment of a dealer’s advertising strategy, which allows the Internet manager to optimize the dollars spent. There remains a great deal of uncertainty and potential waste in a dealer’s overall advertising effectiveness, however, simply because the remaining non-Internet components lack a definitive form of measurement. In other words, you cannot click the newspaper…until now.

The mobile phone as an advertising channel

Over the past couple of years, the mobile phone has become a viable marketing channel which promises to not only bring measurability to other forms of advertising, but also to create a new and effective way for dealers to reach and connect with car buyers at anytime and from anywhere. With the dramatic adoption of mobile computing, mobile Web browsing, and SMS text messaging, consumers no longer have to be tied to their PC to instantly access information for just about anything. Now dealers can now use all of their advertising venues to drive car buyers to mobile versions of their online presence, and there are new services that will launch their showrooms, and their vehicle inventory, into the mobile space. Suddenly, a dealer can make a print ad, direct mailer, or TV commercial ‘clickable,’ even without a computer.

Using text messaging and the mobile Web to drive traffic

Text messaging has become ingrained in our culture and it has proven to be an effective way to drive consumers directly from an offline advertising venue into an advertiser’s mobile presence or inventory. What is great about this is that these text messages and their usage statistics can be captured, reports can be generated, and insights can be gained about the effectiveness of the ad pieces that generated them.

According to Mike Sage, vice president and director of systems at Sage Automotive Group, “Print and other offline advertising continue to be very important to our business, but the ability to generate direct response from it is never guaranteed. Giving consumers a way to immediately respond to our ads opens up entirely new opportunities for us, and we expect the mobile phone will become an increasingly important part of our advertising mix.”

Working with a mobile marketing platform provider, a dealer can begin placing trackable keywords, VIN’s, or stock numbers into ads that consumers text from their mobile phones. The TV talent competition American Idol introduced this concept to the masses by allowing fans to vote for their favorite contestants by sending a text message. The concept is the same for dealers. These buyer-generated text messages result in automatic replies from the dealer about specific vehicles or promotions with links that launch a mobile phone’s built-in Web browser.

For example, Universal City Nissan in Los Angeles reserved the keyword ‘UCN’ and has begun including it in their newspaper ads and radio commercials. By placing text next to its vehicle ads, like “Text UCN to 48696,” consumers can get more vehicle or promotional information than would otherwise fit in limited ad space. In fact, by asking a consumer to come by the dealership and show their phones containing the saved promotional text message, Universal City Nissan can generate more on-lot visits.

A dealer might also place similar calls-to-action on their window labels, dealership signage, and even in radio or television commercials. With this new technology, consumer can access a dealer’s inventory on-the-spot without going to a PC or remembering a Web address.

How does this translate to making print “clickable”?

The truth is most people have their mobile phones with them, and turned on, at all times. That is why text messaging is immediate and relevant to the car buyer in the moment his interest in a dealer’s offer is highest. In fact, International Data Corporation reports that SMS marketing campaigns see response rates of up to 10 percent. Traditional advertising channels that were once immeasurable can now be quantified and adjusted according to the measured effectiveness of direct mobile calls-to-action placed in those channels.

Mikhail Melomed, Internet Director for Honda Mall of Georgia, says, “We are extremely enthusiastic about the capacity to make our inventory directly available to mobile phones, an act that affords us with a variety of revolutionary possibilities. For instance, using data derived directly from the customer, we are able to measure our offline ad performance with an unprecedented degree of accuracy, and tailor future ad campaigns to be significantly more effective at enticing buyers to the lot.”

Isn’t text messaging for teenagers?

Not any more, and it hasn’t been that way for some time. While the primary purpose of a cell phone remains voice calls, the number two and number three reasons for cell phone purchases are text messaging and mobile Web browsing. Most cell phones come with these technologies built-in, and the carriers are making mobile data services cheaper and more accessible in order to stay competitive. In fact, according to InsightExpress, in September 2007, over 50 percent of the over 240 million U.S. mobile phone subscribers have mobile Internet access and 75 percent have text messaging capabilities. Of this subscriber base, daily usage of text messaging and mobile browsing is growing fastest among 25-54 year olds with over 40 percent of them text messaging daily. To further “boggle the mind,” the CTIA Wireless Association reports that there were over 28 billion text messages sent in June 2007 alone. That is almost 1 billion per day, and increasing.

Getting started

It is surprisingly simple and inexpensive for automotive dealers to access the increasingly mobile consumer, and there are two main reasons for doing so: Shortening the sales cycle and getting more value from existing offline advertising expenditures. While online advertising continues to consume an increasing portion of a dealer’s total marketing budget, there is still a need to effectively reach consumers when they are not online.

Markedly cheaper than dedicated toll free phone numbers, text messaging and attached mobile Web pages open up new lines of communication with consumers. By opening the mobile channel, the dealer effectively integrates all of his marketing efforts, creates more opportunities to capture leads, gets more value from all of his advertising, and sells more cars.

Selling cars is still a ‘people business’ and mobile reaches those people in an exciting, personal, and immediate way.

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