Big auto companies reinvent ads online

BMW X1 lime edition
Oscar Siagian | Getty Images

Cars used to be the big moneymaker in print and television advertising. Now, auto manufacturers are shifting their budgets to digital media to get in front of where consumers increasingly are. That means, among other things, changing the way they traditionally create ads.

Manuel Sattig, BMW's North America manager of brand strategy and communication, said the company is moving toward a more digital-heavy strategy. Unlike in the past, digital content is now always a part of the plan when launching a product.

"If you look back a couple of years ago, not a lot of people were connected every day on devices," he said "We see in the usage amount, usage percentage and the usage time that they spend on connected devices that it is just increasing and increasing."

While TV still provides opportunities to reach wide swaths of people at one time and create awareness, digital media is helping the get BMW in front of mass audiences as well. Sattig said the brand was scaling down its print budget to make space for more digital content.

Digital ads are especially important when trying to reach millennials, Sattig said. It's why advertising budgets for M2 and its entry-level BMW, the upcoming X1, skew more towards digital content than television. Sattig explained that it's partially to build awareness and desirability for the brand, but also because BMW believes that millennials are ready to make those luxury car purchases despite the reports that some claim they are the poorest generation.

"I think there's also millennials who do have the money since it's such a large group right now," he said. "It's the largest living population group in the U.S. They spend a lot of time on education, on finding new jobs or finding upcoming jobs. I think you'll find a certain population of that millennial group can afford that car."

One of the most interesting facts about digital auto ads today, however, is that the content is often not created by the brands itself. Thanks to the power of user-generated content and platforms like YouTube, car enthusiasts are creating their own unpaid brand videos and getting people behind the companies.

ZEFR, a technology platform that tracks online influencers, took a closer look at YouTube. It determined that there are about 6.5 million videos with auto themes on the platform that have accounted for 35 billion views.

"YouTube is the single biggest spot for auto information since the invention of the wheel," said ZEFR Senior Vice President and Head of Marketing Dave Rosner. "There's never been a resource like this, and it keeps growing."

It's not just for millennials. Since buying a car can happen at most life stages, digital media car content appeals to a wide swath of ages and levels of car enthusiasm. Racing videos account for 895,000 videos and 8.2 billion views, while there are 305,000 classic car video clips with 1.6 billion views. Auto repair how-tos rank among the top three categories. However, less niche categories such as road trips and new car surprises are also popular.

"Each one of these facts represents an entire world that wasn't accessible at this scale for brands before," Rosner said.

It also means that if manufacturers can identify the right influencer, they can create branded content that will resonate with their ideal consumer, Rosner said.

"The brands that have a strategic approach are winning," Rosner said. "Winning might be the most views, but it could be viewers' views that connect with the right people and build a relationship."

Instead of traditional ads, car manufacturers are integrating their products into YouTube clips. For example, Honda tapped multichannel network Machinima to integrate them into their "Street Fighter Assassin's Fist" series. Fans of the video game know that one of the bonus rounds involves having one of the characters beat up on a car. Machinima brought that idea to life with a slight twist.

"Influencers have been a topic of discussion for many years, but really in the last year to 18 months the frenzy has hit a bit of a fever pitch," said Michael Dossett, RPA agency's supervisor of digital content strategy.

Or, they're creating their own content in an attempt to be an influencer. #BMWstories are mini-documentaries about BMW enthusiasts, ranging from profiling a family where every member owns a 3 series or an 83-year-old precision driver. Sattig said some of the X1's campaigns started as digital assets, but due to their popularity the content jumped across platform to TV.

Dossett said more auto brands are heavily investing in creating digital-only or digital-first content instead of repurposing 30-second ads. Not only does it attract the attention of new consumers, but it allows the companies to test the effectiveness of their ads because technology can provide more metrics for success.

However, the rapid pace of the Internet provides other challenges.

"If you look at the TV slate for the year, you're probably only going to get four or five unique spots [for commercials]," Dossett said. "On digital, you're creating multiple pieces of content, sometimes each day. You have to be able to be nimble and consistent in the content you are creating, because it's really difficult to go dark. At the same time, you wouldn't want to hit people with the same message again and again."

Dossett stops short of saying car ads on TV are obsolete. Right now, the two complement each other, he pointed out.

"I think TV is never going to go away," he said. "It's an important mass reach medium…. A lot of brands are seeing that (digital) is not the last step for conversion. (But), any transitions that are taking place right now are not arbitrary, because people are changing how they use media."