3 Ways Automakers Can Use Customer Data to Rethink How to Sell Cars
Automakers across the U.S. and Europe have responded to the novel coronavirus with temporary shutdowns of manufacturing plants. Some are shifting gears and hope to help ease the crisis by making ventilators or masks. Others, like much of the rest of the world, are experiencing a long pause and the exact path back to something resembling normal is still unclear.
As automotive companies rethink how to reach consumers—and consumers themselves examine their vehicle needs—we look at three data-driven strategies that could help the industry rework customer journeys and hopefully capture a share of the shifting demand.
While auto manufacturers have historically relied on television to drive brand awareness, it’s expensive, and many of those entertained by the commercials have no plans to buy a car soon. (Americans keep their cars for 12 years on average these days).
For example, if you were one of the 102 million people who watched Super Bowl LIV in February—before the spread of COVID-19 forced the closure of all sporting events—chances are you saw many of these brand awareness campaigns. Subaru, Jeep, Toyota, and Porsche are just a few of the companies who paid the astronomical price (as much as $5.6 million for 30 seconds) for these coveted commercial spots.
But now that sort of spend may seem too risky. Auto manufacturers are rethinking how they can shorten the customer journey distance between brand awareness and drivers who own and love their vehicles. The lengthy and complex path to a vehicle purchase often begins with online research, pushing dealership visits toward the end of the buyer’s journey. Add a global economic downturn and it’s easy to see why marketers are rushing to stretch their budgets and precisely target those most likely to buy now.
Strategy #1. Target Niche Customer Segments with Data-driven Customer Personalization
Who let the dogs out?! Odds are good you’ve seen the car commercials with the furry blended family of golden retrievers and yellow labs behind the wheel of a Subaru.
The Barkleys, part of Subaru’s “Dog Tested, Dog Approved” campaigns, have been a huge hit with consumers. Many of these dog-starring videos have been watched several million times on Subaru’s YouTube channel—and they’re commercials. Why? Because they’re hilarious. And adorable. In fact, Subaru’s website has an entire video library dedicated to the Barkleys so customers can watch their favorites: short episodes with titles like Scram, Bad Hair Day, and Doggie Bag.
What do cute dogs have to do with targeting niche customer segments? Subaru’s research department stumbled across an interesting tidbit: Subaru owners indexed highly as dog owners. With that nugget of data, Subaru began incorporating dogs into their marketing campaigns, starting in 2008 with a commercial showing a dog driving a Subaru. The company ran accompanying print ads in partnership with the ASPCA saying, “Without dogs, how would you get rid of that new-car smell?”
Since then, Subaru has leaned into dogs in a big way. “The latest number was that more than 60 percent of Subaru owners have a dog,” Brian Cavallucci, national advertising manager for Subaru of America, told Forbes. While the company has long known that its owners were dog people, it became more apparent when it launched its “Share the Love” initiative, offering new owners an opportunity to contribute $250 to a favorite charity. The ASPCA was customers’ top choice—by a landslide.
Designing Cars with Dogs In Mind
Subaru’s dedication to its dog-loving consumers goes beyond marketing. Subaru thinks about dogs in its approach to product design. “We pride ourselves on making cars easier to use, whether that applies to human occupants or dogs,” Michael McHale, director of corporate communications for Subaru, told Parade Magazine. “We make sure that our doors are wide, and open to 90 degrees. It makes it easier when putting a baby seat or a dog crate in the back seat.”
Subaru’s emphasis on customer experience (CX) has paid off. Industry studies consistently place Subaru among the leaders in customer loyalty. A recent J.D. Powers brand-loyalty study ranks Subaru the highest among mainstream auto brands. Subaru’s CEO says such affinity comes from trust based on drivability, safety, and high quality that includes vehicle durability. An astonishing 97 percent of Subaru vehicles sold in the last 10 years are still on the road today. But there’s a lot more to the story.
What’s the Secret to Subaru’s Customer Loyalty? Using Customer Data for EVERYTHING
Subaru’s marketers use customer data, assembled from many different data sources by a customer data platform, to understand customer behavior at different stages of the relationship, from presale to post-sale add-ons to loyalty.
Saito Kazutaka, general manager of digital innovation at Subaru, says data management is key to delivering that experience. “We first implemented the Arm Treasure Data enterprise Customer Data Platform (CDP) to unify customer data for operational improvement and web optimization. Since we began using Treasure Data in 2016, we’ve unified more than about 200 data points and 80 billion data records. We currently collect more than 8 million new transactions daily, across the entire customer journey.”
Customer Data Powers New Product Design at Subaru
The volume and variety of data have opened up new possibilities for Subaru’s strategy to develop strong customer loyalty. Now, Subaru uses customer data to design new products and services aimed at boosting revenues and improving CX for each customer.
“Today we place particular emphasis on capturing post-purchase driver data and feedback for use in the development of new products and services. Using a wealth of both internal and market data, we’re able to design vehicles and experience that maximize economy and enjoyment—that helps Subaru build customer loyalty and distinguish our brand for success in a highly competitive transportation market,” says Kazutaka.
Strategy #2. Revamp Customer Journeys to Address Customer Pain Points
Ford’s strategy for winning customer loyalty is simple but not easy. Founded more than 100 years ago, the company is laser focused on improving the customer experience of every brand interaction.
The company’s mobile app—FordPass—allows users to schedule vehicle maintenance, request roadside assistance, manage car payments, and track reward points. In addition, the app also provides remote functionality, including checking vehicle vitals (like gas tank level) and vehicle location.
Ford is paying attention to the preferences and rising expectations of today’s customers by focusing on convenience. For instance, the automaker rolled out a mobile repair shop—a truck that will go to your home or office—so customers don’t have to visit a dealership for an oil change or a new set of tires.
But the company’s not stopping there. It is overhauling the entire experience of buying a car. “The customer experience is the most important area we can invest in to become the world’s most trusted company,” said Elena Ford, the company’s chief customer experience officer (and Henry Ford’s great-great-granddaughter).
In an effort to improve customer experience, the automaker has also introduced new retail formats. In the last few years, more than 1,000 U.S. dealers upgraded their Ford showrooms, plus Ford has introduced Ford Signature stores and Ford Smart Labs globally. These new experiences allow consumers to engage with the Ford brand in a no-pressure environment.
Strategy #3. Embrace Experiential Marketing
Car manufacturers have a long history of connecting to consumers at large-scale events. Honda, for example, has sponsored the Austin City Limits Music Festival for 11 years. At the festival last October, the automotive brand introduced its Seat Belt Forest—a bright, colorful Instagram-worthy installation created from 600 seat belts. It’s a clever way to encourage new brand interactions and viral sharing. Honda even sent “GIFographers” out to help festival fans capture shareable GIFs, boomerangs, and photos.
“ACL Fest continues to play a major role in connecting the Honda brand with Millennial and Gen Z music fans who represent the next generation of auto buyers,” said Meliza Humphrey, manager of national advertising for Honda. “We’re pleased to again provide unforgettable performances on the Honda Stage and an immersive Honda brand experience for festivalgoers.”
Millennials in particular want to collect experiences, not possessions. This behavior has given rise to an entire “experience economy,” and brands have had to adapt to connect with consumers.
But how can automakers embrace experiential marketing right now in the age of social distancing?
Fiat Chrysler Automobiles (FCA) didn’t miss a beat. The global automaker—known for brands such as Chrysler, Dodge, Fiat, Jeep, Ram, and Maserati—was quick to set up a virtual concert series on Facebook Live for the month of April. Using hashtags #TogetherAtHome and #MusicMonday, Fiat Chrysler aimed at entertaining and uniting consumers during the pandemic.
“In times such as these, familiar songs of optimism have the power to inspire like nothing else,” said Olivier Francois, Chief Marketing Officer, FCA. “We want to both connect and bring comfort through music to all Americans as we face this crisis together. And also to encourage our community of owners, fans and followers to pledge to stay at home, when possible, for their health and the health of their loved ones.”
The brand’s coronavirus-relief efforts also include manufacturing and donating 1 million face masks per month and providing 1 million meals to school children across North America.
Customer Data Continues to Drive Success
The one thing all of these strategies have in common is a deep understanding of customers, which relies on customer data. The more complete, current, accurate data that automakers have on consumers, the better positioned they are to convert prospects into buyers.
However, in a Forrester Consulting study commissioned by Neustar, only ten percent of respondents said they were very confident in their brands’ ability to build a 360-degree view of their customers. At the same time, a whopping 77 percent of these same respondents admitted that creating this 360-degree view is either important or very important to the success of their businesses.
Auto manufacturers who want to quicken the path from brand awareness to car purchase need to close this gap in consumer understanding and create truly unified views of each customer and prospect.
For more on how customer data can steer auto buyers to your brand, visit Arm Treasure Data automotive solutions.