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Australian car market seven years behind in digital new entrant claims

Australia’s car industry is five to seven years behind the US and Europe in adopting digital marketing as a core part of its business strategy, the newly-appointed Australian head of digital specialist Search Optics claims.

Tom Wright says Australia is lagging the US in the use of digital in the automotive market

Tom Wright says Australia is lagging behind the US in the use of digital in the automotive market

The digital marketing provider is moving into the Australian market for the first time, but admits the local industry is completely different to other markets in terms of scale and the way dealerships have evolved.

It also faces the challenge of the market dominated by a handful of marques, but still boasting one of the world’s most diverse number of individual car brands on sale.

Tom Wright, who worked with REA Group in Australia at the beginning of its assault on the real estate market, told Mumbrella there was much that could be changed about the way Australian car makers and dealers connect with their customers.

“Australia is a key growth opportunity for our rapidly expanding global brand,” Wright said.

“From my early observations in Australia, as we have seen in other markets around the world, original equipment manufacturers, dealer groups and owner/operator dealerships can implement digital strategies that are far more effective.”

Wright said the lag in how car makers and their dealers were using digital was across the board – and legacy marketing practices – needed to be changed.

“If you look at the (Australian) market, and I don’t mean this with any disrespect, we are looking at around about seven years in arrears in the digital market space as we currently stand,” he said.

“The stuff that is being put into play now is what we witnessed six or seven years ago in the States and four or five years ago in the UK.”

He cited Australian car companies and dealers being well behind in areas such as not being mobile ready, with many dealer networks not having mobile responsive sites, while they were also not using enquiry methods such as SMS and live chat systems to engage customers when they landed on sites – an approach that was becoming universal in the US.

Dealers have also been slow developing custom CRM while also using analytics and many dealers had also failed to get on the content bandwagon with limited use of content and videos.

However, he said that across the board Australian businesses would be able to adapt more up-to-date marketing platforms and strategies more quickly.

Some areas which were ripe for exploitation by car makers and dealers was the use of programmatic systems for ads and developing after care service packages that rusted on customers to a dealer.

“If you look at Australia as a whole you are now the fastest adopter of mobile technology. The companies have got to adapt a lot faster.”

He said that even though the manufacturing of cars in Australia was disappearing, manufacturers from around the world still saw the country as a market with significant growth potential and many marques were lifting their budgets.

While digital will claim a pivotal role in car sales throughout Australia, Wright said dealers would remain where the sale was completed.

“I don’t ever think we are going to get to the Amazon nirvana of ‘one click’ to buy a car but (the question) is ‘how do you get to the path of least resistance?’. But why would you invest millions in a showroom if you don’t invest millions in your online showroom?”

While Search Optics operates outside the car marketing in other regions he said the company would focus on its specialty as it entered the Australian market.

Wright says that the need for progress in the digital space was demonstrated at a recent conference in Las Vegas where more than 300 Australian dealers spent time with Search Optics and its Australian competitors.

“A great percentage of the Australian dealer associations are aware that there needs to be change and its how they can see what’s working in the other markets.

“Having a website that’s poorly maintained or unstaffed or nobody responding is the same as having a dealer ship when you walk there’s nobody there to speak to you.

“It is a fragmented market at the moment and all you have to do is look at the different brand campaigns across the sector from the different manufacturers and look at the tack they are taking.

“The biggest challenge is the education part and the awareness of the digital market because its a changing market and there are obviously still a few people that are continuing doing business as they were. It’s just highlighting the trends and being able to enable them to move into the trends.

“A great percentage of the Australian dealer associations are aware that there needs to be change. and its how they can see what’s working in the market.”

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