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Event marketing reigns supreme

Survey reveals special promotions reap best rewards

The role of event marketing in the automotive industry is considerable and is expected to grow. That's because companies find events a better return on investment than other forms of promotion, according to a survey commissioned by exhibit and event maker George P. Johnson Co. in Auburn Hills, Mich.

Among 25 automotive manufacturers and parts suppliers surveyed, 89 percent use event marketing; 46 percent said the importance of these events is increasing. Half of the auto executives surveyed said they are planning to expand their event marketing budgets by an average of 21 percent.

Rich Anderman, general manager of marketing communications for Mercedes Benz USA Inc., said Mercedes spends about 20 percent of its marketing budget in events but will increase that percentage slightly next year because of more product launches.

Anderman said the advertising impact of events is easier to measure than that of traditional advertising.

"We are all trying to change perceptions, create awareness and increase consideration," he said. "With events and presence marketing we can start to look at the hard measurements, which are closer to driving sales and true intentions."

Anderman said Mercedes gets a higher return on investment for events if the invitation list has been screened carefully and if Mercedes products are on hand for consumers to test drive.

Automakers spend more

Intellitrends, the Clarkston, Mich., market research firm hired by George P. Johnson to conduct the study, interviewed 120 companies in the automotive, information technology, media/entertainment, consumer electronics and health care industries from Sept. 19 to Oct. 22.

Event marketing made up an average of 22 percent of the marketing budgets of auto-related companies, compared with 22.7 percent in media/entertainment, 22.6 in information technology and 21.3 in health care.

But the study found automakers and health care companies are more likely than companies in other industries to plan events costing between $250,000 and $500,000. For events costing more than $500,000, auto-related companies are the primary sponsors.

Of the 120 companies, 47 percent said event marketing is giving a higher return on investment than advertising, sales promotion, public relations and Internet advertising. Among auto-related companies, 75 percent said events gave a better return than other promotional activities.

Michael Westcott, executive director of marketing for George P. Johnson, said, "While marketing is probably taking a bigger hit than other parts of major U.S. corporations, it was interesting to note that 38 percent of (all) companies (in the survey) did expect their budgets in event marketing to increase in 2002 by an average of 22 percent."

Traditional media still king

Mike Vogel, chairman and CEO of PentaMark Worldwide in Troy, Mich., the Chrysler group's national advertising agency, said he sees more of a regional and dealer focus in Chrysler's event planning. PentaMark oversees the Chrysler group's marketing events such as Camp Jeep.

"The Winter Carnival in St. Paul (Minn.), Cinco de Mayo in Miami and high school football in the South is big stuff," Vogel said.

But he added that traditional media still are the big players.

"More money is shifting out (to events) than used to be," he said, "but the national media is where your exposure is. To generate the awareness, you need to stay with print and broadcast.

You can reach Laura Clark Geist at autonews@crain.com

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