Mobile marketing is the new battleground for automakers

To advertise its new A7 sedan, Audi plastered the message "bold design" across YouTube on May 1, becoming the sole advertiser on the video channel that day for users of mobile devices.

It was the first time a luxury-car maker had taken over that platform, and Audi says more than 23 million potential customers saw the ad.

The takeover was part of Audi's effort to tap into a fast-growing ad medium for luxury buyers: mobile devices.

Just a few years ago, carmakers hardly had a presence there, but as more potential buyers own smart phones, many luxury-car makers are taking advantage of the opportunity to reach those buyers wherever they are. Those carmakers are making mobile a priority, ensuring that Web sites are compatible with mobile, designing apps and incorporating their ads within existing platforms.

It's all in response to the way luxury-car buyers use their phones in every step of the car-buying process.

Gartner, a leading technology research company, projected that total annual revenue from mobile advertising, including apps and mobile Web display ads, will reach $3.3 billion in 2011.

A 2010 Google study found that up to 20 percent of search traffic on automakers' Web sites comes through mobile devices.

While mobile use is growing across the board, today's luxury-car buyers are twice as likely as volume-car shoppers to use mobile devices to research a vehicle purchase, according to a June 2010 Compete Auto Shopper Study commissioned by Google.

Arianne Walker, J.D. Power and Associates' director of media and marketing research, said that with the likely proliferation of smart phones in the next couple of years "we will see huge growth in people's usage of mobile sites and apps to get content about vehicles."

Scott Keogh, Audi of America's chief marketing officer, said that for Audi, mobile marketing such as the A7 ad "is the most crucial thing we're doing." He said 92 percent of Audi buyers visit the brand's Web site before purchasing vehicles.

For the A7, Audi launched an interactive billboard in New York's Times Square on which people can see their tweets and Foursquare check-ins posted. From April 18 through May 1, 17.7 million messages were received.

Audi also chose seven U.S. cities and highlighted bold outdoor designs in each city for people to explore using the Google Maps technology on YouTube, Facebook and a Web site designed for mobile devices. Linking all those aspects creates a "massive impact and gets people rallied around the bold-design cause," Keogh said.

At BMW, the focus has been making sure content is relevant to a mobile device, said Trudy Hardy, who manages BMW of North America's marketing communications and consumer events.

BMW, like many other auto companies, is tailoring applications to the best use of mobile and is leaving intricate videos, which can be difficult to download, on the desktop Web site. It ran an iAd for the X3 small crossover on Apple's mobile network allowing buyers to customize their cars and see a video as a car is being built.

Jon Budd, Hyundai's senior group manager for customer relationship and interactive marketing, said connecting to mobile customers is critical to Hyundai. Hyundai launched its own mobile channel on YouTube providing mobile-friendly video content to auto shoppers.

Molly Peck, Cadillac's director of advertising and sales promotion, said, "This is a medium that's just exploding for us." Cadillac's efforts have focused on apps for both current and prospective buyers. The app for current owners, which has received 20,000 downloads, includes access to a navigation system to locate a car in a crowded parking lot.

At Lincoln, a third of the media budget is devoted to mobile advertising, and it is planning a big mobile push for the MKX and MKZ, said Brian McClary, social and emerging-media specialist for Ford and Lincoln.

Google is helping automakers tap into this market through its display, video and mobile arm.

Google worked with Hyundai to ensure that when consumers visited Hyundai's YouTube mobile site they would get an experience tailored to the mobile phone.

Brad Spirrison, managing editor for Appolicious, a mobile app discovery service, said that a few years ago it would have been costly for dealers to develop their own apps but now it's cheaper to "have a presence on smart phones of potential customers in an easier way."

Andy White, general manager of Lexus of Knoxville in Knoxville, Tenn., said he was the first in his area to develop a full-service app, which went live in March. It allows consumers to search inventory, get quotes on cars and schedule service appointments. He says he already has sold four cars to people who found him through the app.

At the Ron Tonkin Family of Dealerships in Portland, Ore., Danny Dragomir, the digital marketing director, is creating a code for window stickers on the dealer lot and print ads that can be scanned by a code reader on the phone. Passing a smart phone over those codes sends marketing material to the mobile device.

Though automakers continue to expand offerings available on mobile phones, they won't be able to include one key function: the ability to buy a car, at least for now. State laws prohibit it.

Besides, Spirrison said, he's "skeptical about how many people would actually purchase a car sight unseen."