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See Spot Drive…Auto Sales

On 11/2/11, Spots n Dots reported “Sales Up 1.9%; Industry Up 8%” in their lead story on Automotive car sales in October. It was a modest, but positive, indicator for the Auto category.

But… there is more to this story.

During the course of 2011, varying economic conditions and natural disasters had a huge impact on the automotive industry. When compared with 2010, first quarter 2011 unit sales were up +19.5%, dropped to +5.8% in second quarter and leveled off at +5.7% in third quarter. However, within those broad aggregations were significant gains – and losses – and a remarkable correlation to spot TV advertising levels.

A TVB analysis of spot television spending and unit sales during the first 9 months of 2011, revealed that 57% of the 14 manufacturers studied sold more, or less, cars when they altered their spot TV advertising spend.

Here are some examples:

  • Hyundai steadily increased its local TV spending by +19% in Q1, +25% in Q2 and +22% in Q3. In the first 9 months of 2011, sales grew +27%.
  • In Q3, as the Japanese manufacturers were returning to the US market, Honda reduced its local TV ad spending by -32% and unit sales fell -20.8%; and Toyota cut its local TV dollars -23% and sales dropped -17.9%.
  • By contrast, Mazda increased spot dollars +82% in Q3 and saw a +17% rise in car sales.
  • Domestics Ford and General Motors, seized the opportunity by increasing their spot spending +15% and +24% in Q2 and Q3, respectively, and realized +7% and +13% unit sales growth from April through September.

Despite marketplace disruptions, the long-established relationship of local TV advertising and automobile sales appears to prevail.

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