Market share is an important consideration for how much to budget for marketing, said Lauren Donalson, senior director of national accounts for dealership marketing provider PureCars.
"If we can pivot dollars to work for you more effectively, perfect. ... If that means that your overall ad spend reduces, and you're still crushing your objectives and not losing market share, great," she said. "That means that your ad cost per unit sold has effectively gone down, and more [profits are] in the dealers' pockets."
Bobby Sight, vice president of Rob Sight Ford in Kansas City, Mo., said his store's marketing budget has stayed mostly consistent since last year. His goal is to keep the store's order banks full so that vehicles turn quickly, giving the dealership the ability to increase its allocation from Ford Motor Co.
During the pandemic, Sight said he turned his attention to the service department, an area he hadn't spent much to promote in the past beyond direct mailers. He said he has continued digital marketing for service in part because some customers might want to keep older vehicles running longer rather than buy while retail prices are high.
"Just because you don't have inventory on the ground doesn't mean there aren't other areas in the dealership that you need to market towards," Sight said. "Those other areas, I think, also keep you relevant from the sales perspective because you always want to keep your dealership name in front. You never want to go dark."
Staying in front of shoppers throughout the car-buying process is important, even while inventory is low, because it could take awhile to restart the advertising pipeline when vehicle supply returns, said Nick Brunotte, digital solutions director at DHG Dealerships.
Some marketing vendors say sales offers and incentives will always have a place, especially as inventory levels normalize. But some of the changes adopted during the pandemic and chip shortage may stick, such as pitches to buy customers' used vehicles.
"It's oriented towards filling their inventory at a lower cost of what they would do at auction," Donalson said. "Now that dealers' eyes have been opened to the increased profits that they see by deploying this type of messaging, they'll continue to pursue it."
Melissa Burden contributed to this report.