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Boston, November 4-5, 2004
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Join us at Forrester's Executive Strategy Forum 2004, where Forrester analysts and executives from UPS, Dell, and General Motors -- just to name a few -- will discuss "Accelerating Top-Line Growth."
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Detroit, October 18-20, 2004
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I'll be presenting a paper on how to sync product development in auto engineering and electronics at Convergence 2004.
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Los Angeles, March 1, 2005
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Forrester will be hosting its annual Automotive Workshop, where auto industry leaders from OEMs to dealers will engage in panel discussions, in-depth confabs, and much more. For information and to register, email me at markbunger@forrester.com.
Auto ads and sports go hand in hand -- online. One in five US users regularly visits league sites like nfl.com, nhl.com, or nascar.com. Football sites are their goal: 14% of all online Americans visit football-oriented sites monthly, compared with 8% for baseball sites and 7% for NASCAR sites.
DaimlerChrysler has mastered advergaming. Think they're just reaching teenage boys? Wrong -- online women are more likely to play games and visit online gaming sites than online men (32% versus 28%). In contrast, men are more likely to research products online for purchase (16% versus 14%).
Hispanics, followed by Blacks, are the most frequent console gamers. Blacks are also the most likely ethnic group to visit gaming sites on the Internet.
Our research shows that consumers are 34% more likely to buy a car when having a child and 30% more likely when buying a home.
The US presidential election is just weeks away, but Forrester believes neither Bush nor Kerry's current ideas will boost innovation in the US, nor will they wean the US off of oil for centuries. But General Motors has a plan for both: The company estimates that $12 billion would pay for a hydrogen infrastructure that reaches 70% of American drivers.
Viewers who time-shift TV shows skip 84% of auto ads and 90% of dealer ads. What's more, DVR penetration will reach 41% within five years.
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Last week I saw an automaker colleague for the first time in a few months, and WOW -- he looked 10 years younger and 30 pounds lighter. How? "Atkins." Of course, I knew the answer before I asked -- who isn't on a low-carb diet these days? Every man, woman, child, and even pet has joined the dieting craze.
The only place left for this unstoppable fad to go is to. . . the auto industry. After decades of being too portly, the industry is cutting back overcapacity and trying to slim down bloated inventories. Just today, General Motors' Chairman and CEO, Rick Wagoner -- who will be speaking at Forrester's Executive Strategy Forum on November 4 -- told his European divisional heads that they'd need to cut $600m in costs by 2008. That's a lot of carbs (about two factories' worth) to cut, and other OEMs are in the same boat.
This is bad. When workers are laid off and factories close, brands, cities, and families suffer. To keep vital productive capacity alive and healthy, we have to find ways to cut the industry's "empty calories." In this First Look, Dr. Mark prescribes a few dietary recommendations.
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1. Cut Back On The Media-Buy Gluttony
Carmakers and dealers spend a fat $990 per car on ads. But you don't really need that extra spot on "Everybody Loves Raymond" -- only 38% of carbuyers find TV car ads valuable, and increasingly, they won't see them anyway. A recent Forrester study of DVR owners showed that barely half watch prime-time network or premium cable shows in real time. Just like your body, your marketing budget will be healthier with a lot of humor (34% go back to watch ads they find funny) and sports (80% watch in real time). Start your TiVo and VOD strategy now -- it's a matter of survival.
2. Introduce Lean Marketing Methods Like Search And Email.
If TV is candy, then think of your brand site, email, and search as three protein-rich nuts. Not only do they cost less than mass media, consumers trust email (66%) and your brand site (71%) more than any broadcast medium. Search is a low-cost pull medium, and now it is by far the most common way consumers find Web sites. The reach of search is expanding past portals: Only 21% of US online households use MSN at least once a week, compared with 41% that visit Google and Yahoo!. And in the UK, Google has grown its search audience from 67% to 81% of all Internet users.
3. Find A Partner To Keep You On The Program
OEM profits average 3%, so every dollar that marketing saves helps the bottom line as much as $33 in revenue. This means that marketing, like IT, needs a value-based mindset behind every spending decision. And IT and marketing need each other to measure progress -- a few pounds (dollars, yen, and euros) saved every day.
See you at the gym!
Mark Bünger
Senior Analyst, Automotive Research
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