DETROIT -- For the future of automotive retail marketing, look no further than your cell phone.
That was the word on Wednesday, Jan. 18, from executives on the Automotive News World Congress marketing panel, who agreed that those ubiquitous cell phone screens are about to become the hot place to post your next ad message.
"When you leave for work in the morning, what are the three things you take with you?" asked Karen Francis, CEO of the Publicis & Hal Riney advertising and marketing agency.
"For you, me and 180 million cell phone subscribers in the U.S., it's your wallet, your keys and your cell phone. People take their cell phones everywhere."
While those cell phone screens offer advertising opportunity for the auto industry, though, they also will give shoppers an edge at the dealership, panelists agreed.
Online services such as Google give consumers new power at the point of sale by allowing them to use their cell phones to comparison shop by looking up products and prices on the spot.
There are broad implications for dealership sales staff looking to close a deal, panelists said.
Francis said buyers will be able to use their cell phones as tools to get the best deal.
"These services will allow consumers to access information during the sales process," Francis said. "This is going to be very disruptive to the sales process."
But as long as salespeople understand they can be checked by the consumer, the news is not all bad for dealers.
"Mobile pricing could help accelerate the sales process," said Francis.
No more ad bucks
But participants said they wouldn't add marketing dollars to reach emerging buyer groups such as cell phone and iPod users. Instead, they plan to divert money from traditional media buys, such as TV.
"We anticipate a 50 percent reduction in overall television spending," said Jill Lajdziak, general manager of Saturn Division. "We're no longer held hostage by traditional television."
Panelists also agreed that incentives are killing brand value and crippling the marketer's ability to protect their brand.
"Incentive spending is destructive," said Art Spinella, president of CNW Marketing Research Inc.
Despite advances in technology, he said, people still will focus on price and value. If auto companies can break the consumers' desire to wait for the next sale, then a model's brand value will hold steady.
"The best approach is to give the money to the dealers," he said. "Letting the dealers do it is more helpful to closing the sale."
No going back
The incentive lesson is one that panelists said they do not want to repeat.
"We've been on the dark side of that one," said Jan Thompson, vice president of marketing for Nissan North America. "We have crawled out of that hole and don't want to go back."
Lajdziak said Saturn is trying to strengthen its brand image. The aim is to be able to resist industry pressure to offer incentives, she said.
"There was a period where we had to adjust our prices," Lajdziak said. "We do have a strategy of no hassle, no haggle. We don't want the person buying today to feel like they did not get a good deal tomorrow."
Saturn's approach to pricing was a factor in GM's decision to cut vehicle pricing across the board, she said. GM's newest pricing plan drops sticker prices an average of $1,300 per vehicle across 80 percent of the company's lineup.
Joseph Serra, president of Serra Automotive, which owns 22 U.S. dealerships, said it's difficult to measure the direct impact of advertising dollars on unit sales. And the job will get harder as advertisers try to spread their message across more media, he said.
"We all know that if you spend zero dollars, you'll still sell vehicles," Serra said. "But the difficulty of measuring your advertising impact is the magic of the business."
You may e-mail Greg Bowens at [email protected]