Receiving returns on investment from marketing

£115.9 million was invested in online displays and direct mail campaigns by car dealerships throughout the UK in 2016 alone, according to figures gathered for Google’s Car Purchasing UK Report published in April 2017.

Unlike many companies when they invest in marketing campaigns, there’s often a substantial marketing budget provided to automotive manufacturers to utilise. However, questions can be asked about whether digital visibility is worth it when they usually have high price tags attached — no matter how much the interest in online platforms is growing. Join Vindis, an Audi dealership, as it determines whether digital is indeed the way to go when working on your marketing techniques:

The automotive industry

The auto shopper of today is more digitally savvy than those from previous generations, at least that’s the conclusion reached in Google’s Drive To Decide Report, created in association with TNS. According to the report, over 82% of the UK population aged 18 and over have access to the internet for personal reasons, 85% use smartphones and 65% choose a smartphone as their preferred device to access the internet. These figures show that, for car dealers to keep their head in the game, a digital transition is vital.

It was also found in Google’s Drive To Decide Report that 90% of auto shoppers will conduct some form of research online. 51% of buyers start their auto research online, in fact, with 41% of those using a search engine. To capture those shoppers beginning their research online, car dealers must think in terms of the customer’s micro moments of influence, which could include online display ads — one marketing method that currently occupies a significant proportion of car dealers’ marketing budgets.

In total, eMarketer claims that the automotive industry accounted for 11% of all of UK Digital Ad Spending Growth throughout 2017. That places the industry in second place, behind only the retail sector. The automotive industry is forecast to see a further 9.5% increase in ad spending in 2018.

If many car purchases are agreed on the forecourt though, how is the online sphere helping to influence a shopper’s decision? 41% of shoppers who research online find their smartphone research ‘very valuable’. 60% said they were influenced by what they saw in the media, of which 22% were influenced by marketing promotions — proving online investment is working.

The most invested methods of marketing across the automotive sector are still in the form of tried-and-tested means through TV and radio. However, in the last past five years, it is digital that has made the biggest jump from fifth most popular method to third, seeing an increase of 10.6% in expenditure.

The fashion industry

Many fashion retailers see online investment as being critical to their levels of success, especially when you factor in that online sales across the fashion industry hit £16.2 billion in 2017. This figure is expected to continue to grow by a huge 79% by 2022. So where are fashion retailers investing their marketing budgets? Has online marketing become a priority?

Close to a quarter of all purchases were of an ecommerce nature in December 2017, the British Retail Consortium claims. This is due to online brands such as ASOS and Boohoo continuing to embrace the online shopping phenomenon. ASOS experienced an 18% UK sales growth in the final four months of 2017, whilst Boohoo saw a 31% increase in sales throughout the same period.

Millions have been invested by the likes of John Lewis, Marks and Spencer and Next on their online operations and marketing techniques too, as they aim to capture the interests of online shoppers and drive digital sales. John Lewis announced that 40% of its Christmas sales came from online shoppers, and whilst Next struggled to keep up with the sales growth of its competitors, it has announced it will invest £10 million into its online marketing and operations.

It’s become evident that many shoppers no longer have a desire to head to high-street stores for their shopping. Instead, they like the idea of being able to conveniently shop from the comfort of their home, or via their smartphone devices whilst on the move.

A PMYB Influencer Marketing Agency survey claims that 59% of fashion marketers upped their budget with regard to influencer marketing in 2017. This is seen as an important marketing tactic for those in the fashion scene, with 75% of global fashion brands collaborating with social media influencers as part of their marketing strategy.

Over a third of marketers have gone as far as to state that they viewed influencer marketing as being more successful than traditional advertising techniques in the past year. This is because 22% of customers are said to be acquired through influencer marketing.

The healthcare industry

A unique set of rules apply for marketing in the healthcare industry, generally due to those involved in the sector being restricted by heavy regulations. The same ROI methods that have been adopted by other sectors simply don’t work for the healthcare market. Despite nearly 74% of all healthcare marketing emails remaining unopened, you’ll be surprised to learn that email marketing is essential for the healthcare industry’s marketing strategy.

Email is used by around 2.5 million people as a primary means of communication, with this rising in both value and usage over recent years. This means email marketing is targeting a large audience. For this reason, 62% of physicians and other healthcare providers prefer communication via email — and now that smartphone devices allow users to check their emails on their device, email marketing puts companies at the fingertips of their audience.

Those in the healthcare industry should also consider online marketing to be a worthwhile investment. Highlighting this point is the fact that one in 20 Google searches are for health-related content. This could be attributed to the fact that many people turn to a search engine for medical answer before calling the GP.

A search engine will be the start of 77% of all health enquiries, data from Pew Research Center claims. 72% of total internet users also say they’ve looked online for health information within the past year. Furthermore, 52% of smartphone users have used their device to look up the medical information they require. Statistics estimate that marketing spend for online marketing accounts for 35% of the overall budget.

Social media marketing is another technique that healthcare providers would be wise to consider. Whilst the healthcare industry is restricted to how it markets its services and products, that doesn’t mean social media should be neglected. In fact, an effective social media campaign could be a crucial investment for organisations, with 41% of people choosing a healthcare provider based on their social media reputation! And the reason? The success of social campaigns is usually attributed to the fact audiences can engage with the content on familiar platforms.

The utilities industry

Comparison websites are becoming more and more popular with consumers as they seek to select the right utilities supplier for them. These websites could be the key to many suppliers acquiring and retaining customers.

Millions are spent by these comparison websites on TV marketing campaigns, which then get in front of huge audiences. It has therefore become vital for many utility suppliers to be listed on comparison websites and offer a very competitive price, in order to stay in the game.

Also bear in mind that the four largest comparison websites — Compare the Market, MoneySupermarket, Go Compare and Confused.com — are in the list of the UK’s top 100 highest-spending advertisers. However, does that marketing investment reflect on utility suppliers?

The difference between a high rate of customer retention for a single supplier and that of another supplier can hinge on comparison sites. If you don’t beat your competitors, then what is to stop your existing and potential new customers choosing your competitors over you?

The marketing aims of British Gas have recently shifted, with the brand’s aims no longer being focused on customer acquisition but instead on customer retention. Whilst the company recognises that this approach to marketing will be a slower process to yield measurable results, it firmly believes that retention will in turn lead to acquisition. The gas company hopes that, by marketing a wider range of tailored products and services to its existing customers, it will be able to improve customer retention.

A loyalty scheme which will offer discounted energy and services is also something that needs to be watched. It already has a £100 million investment and will focus on the value of a customer, their behaviour and spending habits over time to discover what they are looking for in the company. The utilities sector is incredibly competitive, so it is vital that companies invest in their existing customers before looking for new customers.

The digital sphere is important to the utilities sector, too. 40% of all searches in Q3 2017 were carried out on mobile, and a further 45% of all ad impressions were via mobile too — according to Google’s Public Utilities Report in December 2017. As mobile usage continues to soar, companies need to consider content created specifically for mobile users, as they account for a large proportion of the market now.

Concluding thoughts

Investment in online marketing techniques is certainly important for automotive and fashion industries. With a clear increase in online demand in both sectors that is changing the purchase process, some players could find themselves out of the game before it has even begun if they neglect digital.

Those in the utilities sector shouldn’t discard online marketing methods, though. Whilst TV and digital appear to remain the main sales driving forces, it’s more than just creating your own marketing campaign when comparison sites need to be considered. Without the correct marketing, advertising or listing on comparison sites, you could fall behind.

Upwards of 41% of an average firm’s marketing budget will be allocated to online strategies throughout 2018, webstrategies.com claims. This threshold figure is also expected to grow to 45% by 2020. Social media advertising investments are expected to represent 25% of total online spending and search engine banner ads are also expected to grow significantly too — all presumably as a result of more mobile and online usage.

Where do you stand on investing in marketing campaigns? If mobile and online usage continues to grow year on year at the rate it has done in the past few years, we forecast the investment to be not only worthwhile but essential.