2023 was a year of tremendous changes across the board, including the automotive and marketing industries. Understanding these changes is crucial for auto dealers, as they offer critical insights and lessons to drive future strategies.

Buckle up, and let’s take a leisurely drive through the 23 massive moments in automotive and digital marketing from 2023.

1. Facebook’s New Direction: The End of Free Automotive Listings

In January 2023, Facebook decided it was time to change lanes with its automotive inventory ads. This was a big deal for dealerships because Facebook said goodbye to the option of automatically importing vehicle listings to Marketplace. Instead, they nudged dealerships towards opening their wallets for paid advertising. This move wasn’t just a small tweak; it was a clear sign of Facebook’s changing strategy in how they handle inventory, especially in the automotive world.

2. Honoring a Legacy: Remembering Shoichiro Toyoda

In Feb 2023, Toyota Motor Corporation announced the passing of its Honorary Chairman, Shoichiro Toyoda, at 97. Dr. Toyoda, the son of the company’s founder Kiichiro Toyoda, was a remarkable figure in the automotive world. Beginning his career at Toyota in 1952 after graduating in engineering and later earning a doctorate, he was a key part of advancing automotive technology and quality control.

In 1982, and later as chairman of the board, his tenure on the board spanned 57 years, leaving an indelible mark on the company. Dr. Toyoda, father of current president and CEO Akio Toyoda, leaves behind a legacy of innovation and leadership.

3. Privacy in the Fast Lane: Data Security Takes Center Stage

The last year kicked off with a spotlight on something pretty crucial in the automotive world: data privacy and security. Dealerships must go beyond simply selling cars and properly handle customer data. Consumers made it loud and clear – they want more control and transparency over their personal and behavioral information.

Big regulations like the California Consumer Privacy Act (CCPA) and the General Data Protection Regulation (GDPR) are driving this shift. Dealerships had to take a closer look at how they collect, use, and protect customer data or face fines of up to $7,500 per instance. It’s a whole new road in the digital age, where data security is now an essential part of the game.

4. The Video Marketing Revolution: Engaging Customers on Screen

Video marketing is nothing new, but it made a huge leap in 2023. Dealerships and manufacturers are bringing the showroom experience to screens. For example, Pohanka Acura has been getting creative with inventory highlights, Atlanta Toyota provides virtual test drives, and other dealers offer candid interviews and even peeks behind the scenes. In fact, review videos on YouTube featuring test drives grew 14x over other types of auto-review videos.

Video marketing isn’t just about what dealerships are putting out there. Customers are jumping into the director’s chair, too, with user-generated content adding a personal touch to the car-buying journey. You’ll even find entire industries offering insight into the world of automotive sales through live videos.

The big star? YouTube. Turns out, 70% of car buyers turned to YouTube as part of their decision-making process. It’s a clear signal that when it comes to engaging customers and revving up sales, video content isn’t just a fun tool; it’s an essential part of making the sale.

5. Mobile-First: The New Standard in Digital Engagement

As we cruised through the first quarter of 2023, one trend was impossible to ignore in the automotive sector: the dominance of mobile. Almost 60% of web traffic came from smartphones and tablets.

If your online presence isn’t optimized for mobile, you’re missing out on a huge chunk of the market. It’s more than making your website look good on a smaller screen. It’s about creating a seamless, engaging experience for users who are more likely to tap on their phones than click on a desktop. Going mobile-first is about meeting customers where they are.

6. AI: The New Co-Pilot in Automotive Marketing

Artificial intelligence (AI) is taking the passenger seat in automotive marketing. With the public release of tools like ChatGPT, dealerships got a new ally in their marketing efforts. Think of AI as the Swiss Army knife in the digital marketing toolkit. From analyzing customer data to powering chatbots, AI is doing more than just heavy lifting; it’s bringing a level of personalization and efficiency that was once a pipe dream.

For dealerships, this means engaging with customers in a more targeted, meaningful way. Of course, AI isn’t all positive. Chevrolet of Watsonville released an AI-powered chatbot online that was exploited to agree to sell a new Tahoe for $1.

7. Safeguarding Consumer Trust: The FTC Steps In

June 2023 wasn’t just another month in the automotive industry. It was when the FTC Safeguards Rule rolled out, marking a significant turn in how consumer data is handled. In a world where digital is king, trust is the currency, and this regulation is all about boosting that trust.

For dealerships, compliance is just the start; it’s a commitment to protecting the information that customers entrust them with. This rule isn’t just a set of guidelines; it’s a reflection of an industry that’s becoming more aware and respectful of the digital footprint we all leave behind.

8. Analytics Evolved: The Transition to GA4

This past summer was a big deal for data analytics in the automotive world. We waved goodbye to Universal Analytics and welcomed GA4, Google’s latest analytics tool. GA4 was a complete overhaul all about giving dealerships a deeper, more nuanced understanding of customer behavior. This new data gives you more than just page views; it provides in-depth insights into how and why your customers are taking the journey with you. For dealerships, this means smarter marketing strategies tailored to customers’ needs.

9. The Power of Voice: Click-to-Call’s Impact on Consumer Spending

2023 brought a surprising revelation about the traditional phone call in the digital age. The simple, yet often overlooked, click-to-call feature turned out to be a significant revenue driver. Google suggests that pay-per-call mobile Adwords campaigns have a 6% to 8% higher conversion rate than pay-per-click mobile campaigns. It’s estimated that phone calls initiated from online ads can generate 10-15 times more revenue compared to standard web leads.

This insight is a game-changer, reminding us that amidst the rush toward digitalization, the personal touch of a phone call still holds tremendous value. The power of human connection to engage customers and seal deals isn’t going anywhere.

10. Maximizing Visibility: The Shift to Performance Max

September 2023 brought a game-changer for dealerships in the Google advertising arena. It was time to say farewell to the traditional Shopping Campaigns for Vehicle Listing Ads (VLAs) and hello to Performance Max.

Performance Max is like having a supercharged engine under your ads, giving them more power to reach even more potential customers. For dealerships, this meant their ads could now show up in more places in more impactful ways. It’s about being seen by the right people, at the right time, and in the right context, and that’s what drives results.

11. Labor on the Move: The UAW Strike

October was a month that echoed throughout the automotive industry, not for a groundbreaking car release but for the United Auto Workers (UAW) strike. It was a significant moment that spotlighted the challenges and negotiations within the labor sector. The impact has paused production, affecting manufacturing and market dynamics. For dealerships and manufacturers alike, this event was a reminder of the delicate balance between labor and the automotive industry’s engine.

12. The Return of Incentives: OEM Offers Resurge

As we rolled into the fourth quarter of 2023, there was a noticeable shift back to something a bit more traditional in the automotive world: OEM offers and incentives. It feels like shopping for a car pre-COVID as dealerships and manufacturers started to re-embrace these tried-and-true marketing strategies. This resurgence was a strategic response to the evolving market conditions. Incentives are still relatively low compared to the past, but after being absent for years is a step in the right direction.

13. The Used Car Market Shift: A Positive Trend

The year 2023 brought with it a shift in the used car market, and it wasn’t in the direction many were expecting. We saw a 5.5% dip in used car sales compared to the previous year, coupled with a noticeable drop in prices, thanks to supply improvements. As more new cars come off of the assembly line, inventory trickles down. That meant dealers had to become more aggressive in their marketing to move some of that aged metal.

14. Virtual Reality: A New Dimension in Automotive Sales

2023 marked a significant leap forward in how car dealerships engage with customers, thanks to virtual reality (VR). VR is more than just equipment for a bit of fun; it’s a whole new way to connect buyers with their potential new rides. Imagine walking into a dealership and, instead of being limited to the cars available on the lot, you can explore a wide range of models, colors, and features, all through VR. This technology is transforming the traditional car buying experience, making it more interactive and immersive.

Dealerships from Hyundai and Kia now offer virtual test drives, detailed explorations of car features, and even customization options in a virtual setting. Toyota used VR to launch its C-HR Car, and Audi released VR to help customers experience different accessories. It’s a big step up from flipping through a brochure or scrolling through images online. For customers, this means a richer, more engaging way to shop for cars, and for dealerships, it’s an exciting new tool to showcase their inventory and stand out in a competitive market.

15. Brand Loyalty: Facing Challenges

The end of 2023 revealed a trend that had many in the automotive looking at their strategies: brand loyalty hit an eight-year low. Shoppers are sending a clear signal that brands need to up their game in customer engagement and retention. Dealerships can no longer rely on customers returning based on the brand on the side of the building. It’s also a sign that shoppers are willing to explore different brands to find the right fit, features, and pricing.

16. The Digital Research Journey: Online Influence on Purchases

In Q4 2023, a whopping 92% of car buyers did their homework online before making a purchase. Mobile ads can lead to up to a 45% increase in conversions. This goes to show that the digital world is a major player in the car-buying journey. For dealerships, this means if you’re not making your mark online with high-value content and ads optimized for mobile, you’re missing out on a huge chunk of the customer journey.

17. Data Insights: Tracking Customer Movements

Tracking customer movement and collecting data online is nothing new, but new AI-powered learning algorithms made some impressive leaps in 2023. New tools help dealers pinpoint potential car buyers and, in some cases, even see which customers might be checking out the competition.

Asaf Jacob, a Harley Davidson salesman in NY, tried a tool called Albert by Algorithm to drive leads. Jacob used Albert to analyze existing customer data from his CRM to identify various traits of high-value past customers. He could then identify “lookalikes,” people who had similar traits, to create small sample groups to test various marketing campaigns.

The data gathered from these tests to not just see what worked but to make AI-powered predictions on thousands of campaign variables. For example, a call to action with the word “call” outperformed the word “buy” by 447%.

The result?

Jacob’s dealership went from one qualified lead per day to 40 in the first month; in three months, qualified leads increased by 2,930%. Jacon even doubled his previous record for motorcycle sales in a single weekend.

18. Digital Marketing Spend: A Steady Climb

Digital marketing in the automotive sector accelerated in 2023, with an estimated 11% increase in spending. This followed a 13.7% rise in 2022, clearly showing where the industry is heading. 52% of dealers in PwC’s Car Consumer and Dealer Survey suggested that an increase in digital marketing spend was the most impactful change they made year over year.

Digital channels are the main highway for reaching and engaging customers. For dealerships, allocating more of their budget to digital and working with the right digital marketing agency is critical to stay ahead.

19. The Rise of Digital Retailing: Pre-Ordering Vehicles Online

In Q4 2023, Cars.com reported that 41% of shoppers planned to preorder their next vehicle online. This shift is a sign that digital retailing in the automotive industry is shifting into high gear. Even Amazon is getting into the car-selling game to capitalize on the ease and popularity of online car shopping. For dealerships, this trend is a clear indicator that the future of car sales goes beyond the lot and into the digital world

20. Preparing for a Cookie-less Future: The Growth of Automotive CDPs

The automotive industry had to brace for a big digital shift: the end of cookies as we know them. But rather than hitting the brakes, dealerships started gearing up with Customer Data Platforms (CDPs). These platforms are pivotal in maintaining the momentum of omnichannel marketing strategies.

Dealers have to compete with a better customer experience, new data privacy regulations, and the expansion of AI. Automotive CDPs enable dealerships to unify and analyze customer data from various touchpoints, providing a complete view that drives marketing efforts.

As dealerships embrace CDPs, they’re finding new ways to engage with customers across digital and physical channels, ensuring they provide top-notch service and ROI.

21. EV Market: Navigating a Slowdown

The electric vehicle (EV) market in 2023 hit a few unexpected detours. Despite the market share for EVs bumping up to 52% higher in Q4 of 2023 than in Q4 of 2022, there was a noticeable tap on the brakes in terms of demand. EVs currently only account for 7.6% of the total US car market. Experts don’t see those numbers getting better in 2024.

Range anxiety, reliability worries, and price tags had consumers thinking twice, and even the big players in the industry had to take a step back and rethink their EV strategies. Even with various tax incentives and promotions, EV sales aren’t quite where they were expected to be, although EV leases are getting more attention.

22. Autonomous Vehicles: A Bumpy Road

Autonomous vehicles had their own speed bumps in 2023, especially when the California DMV put the brakes on Cruise’s self-driving robo taxi permits after a series of accidents. This move put a spotlight on the challenges that come with self-driving vehicles. It’s more than making a car that can drive itself. Manufacturers also have to navigate the complex web of regulations and safety concerns. The road to fully autonomous vehicles is still under construction, with plenty of regulatory and technical potholes to fill.

23. Charging Ahead: The NACS Standard for EV Charging

The EV world got a bit of a boost with introducing the NACS standard for EV charging. Standardizing EV charging aims to make the whole experience smoother for EV drivers, reducing range anxiety and making electric cars a more attractive option. These new standards should lower the charging station installation cost by creating a charger that every vehicle can use. It’s a move that shows the industry is not just thinking about getting more EVs on the road but also about making the journey easier for everyone.

Embracing Change in Automotive Marketing

The automotive industry may focus on selling cars, but it’s also about creating experiences, building relationships, and navigating a digital world that’s in constant motion. Whether adapting to new technologies like AI and VR, staying ahead in the digital marketing game, or understanding the nuances of customer data privacy, expert guidance, and innovative strategies are more crucial than ever.

This is where Dealer Authority steps in. With a finger on the pulse of the latest trends and a deep understanding of the automotive market, we are positioned to help dealerships not just keep up but stay ahead. In a world where change is the only constant, partnering with a team that understands the unique challenges and opportunities of the automotive sector can make all the difference.

Looking to navigate these changes and accelerate your dealership forward? Connect with Dealer Authority for tailored digital marketing strategies that drive results and keep you ahead of the competition. Let’s shift gears, learn from 2023, and accelerate into a new year together.

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