Every industry has its struggles but nowhere is that truer than for the automotive industry. Automotive companies are competing in a highly saturated market with a variety of competitors, all fishing for customers that they might only see once every five years. This lack of a consistent relationship means that automotive brands struggle to understand where a customer might be in their vehicle buying journey, which in turn means they can’t communicate with them effectively. The result? A failure to create loyalty.
On top of that, attracting new customers is just as hard. Using what data they have, automotive brands consistently use advertising that does not always reach the right audience, instead opting for a broad spectrum in the hope that some of it might appeal to someone, somewhere. But where there are downsides, there are also major opportunities: a lack of major disruption (so far), an ability to innovate, a product constantly in demand and a trove of data that, while lacking on its own, is extremely valuable when combined with other data sets.
Don’t get complacent
And yet, compared to most industries, it is a market that has seen relatively little disruption: the major brands are still in control of most of the pie and there have been relatively few start-ups that have broken in and changed the game (apart from perhaps Tesla, and recent headlines have illustrated that they might have made their move five years too early).
All of this, however, is not a confirmation that automotive companies should be complacent and keep doing things as they are. The spectre of disruption is on the horizon: electric vehicle infrastructure is growing; autonomous vehicle start-ups are getting closer to releasing a finished product; We are even seeing the advent of the flying car age. If anything, all of this, combined with the intense competition for consumer attention, in a world where most of the public have tightened their belts and lengthened the time in between buying a car, should scream to automotive brands that they need to make a plan.
That plan, however, doesn’t necessarily have to be a flying car. The tools needed to take that one step ahead in the industry are almost all at hand. The first one is the customer data that companies already have. The second is the use of new, innovative data sets. The result? A way to understand a customer like never before.
The power of social clustering
So, what is this new innovative data set? It’s social data, a pioneering new resource that can help brands understand customers and connect them far more accurately.
The automotive industry presents the perfect opportunity to understand the potential of social data, or more precisely, Starcount’s unique method of analysing social data, known as ‘social clustering’ – analysing the passions and likes of social media users and clustering them together into different segments based on similar passions, using our pioneering platform, The Observatory (this method is different to, and much more effective than ‘social listening’ – if you would like to understand more about the differences and why social clustering works better, read this).
Unlike other data sets, social data (when used in social clustering) can provide a much clearer image of who a particular customer is, what they are passionate about and what motivates them in life. It allows you to understand who your customer is and, more importantly, what they will be looking for in your brand.
The first major problem automotive manufacturers are facing is in trying to hold on to customers. How do you create loyalty when, realistically, you are only likely to see a customer once every 5 years, give or take?
The best ways to drive loyalty are to make sure that your customer messaging is timely and relevant. This means that you must understand first, where they are in their vehicle journey – just bought a new one; have had one for several years; starting to think about purchasing another – and second, what they are passionate about.
Understanding both means that you can tailor your messaging to maximum effect. An automotive brand’s data might show that a customer bought a car three years ago. That’s pretty much the extent of it.
Now, enrich that with social data, and suddenly you will understand so much more about who they are. Firstly, their passions: they are passionate about technology and environmental issues. When you communicate with them, you can highlight to that particular customer the new model’s environmentally friendly capabilities whilst also underlining the gadgets that come with it.
Secondly, their automotive purchasing journey. Social clustering allows you to timestamp the social data, meaning you can see how their passions have changed over time. If they have suddenly started following lots of brands or influencers related to having a family, it’s more than likely they are in the process of having one themselves. But that car they bought three years ago, it’s definitely not family friendly, which means that they might be looking to purchase something that is.
Now you can send them an email highlighting the new family friendly model, emphasising the environmentally-friendly qualities and techy gadgets. This communication is not only highly relevant and timely, it’s also predictive.
That is how you create loyalty: by knowing your customer better than they know themselves.
The other major issue that automotive retailers are facing is how do you find the right audience for the right vehicle? How can you become more intelligent in customer targeting? It’s just as well retaining customers but not very helpful if you can’t attract new ones.
The answer relies on two factors: understanding where the right audience is so that you can target them effectively and understanding what they are passionate about so that you can talk to them effectively.
Unfortunately, geo-demographics alone is not the answer. However, by combining geo-demographic data with social clustering, you can build an audience, locate them and deliver messaging that resonates well with their passions. This is the power of Starcount’s new product, Audiences.
Let’s say that your new vehicle is spacious, and you understand that this is going to appeal to people in different ways: families, sports fanatics outdoor adventurers. First, we go to the social data, segmenting the overall number of social users into different segments such as those listed above.
Once these segments are built, we enrich this with third party geo-demographic data and open source data, in order to match some of these social media users. This allows us to identify a location down to a postcode level, and other information that might reveal more, such as their occupation or whether they are likely to have a family. With this information, we can model out to identify other individuals who share similar passions or traits.
The result is the identification of consumers who are passionate about a particular subject and live in a particular location. This insight allows the automotive manufacturer to then tailor a marketing campaign that incorporates the specific passion (for example, showing how it is the vehicle of choice for outdoor adventurers) and then accurately target that audience in the right location.
Complacency is the biggest killer of companies. And while it may appear that the automotive industry has yet to be majorly disrupted, it is coming, and when it does, brands need to show consumers why they are still relevant. That is why putting data at the heart of everything you do is crucial.
Because who needs a flying taxi when your automotive brand has just offered you the perfect car at the perfect time for the perfect idea.