How to Use Location Data to Better Understand Consumer Behavior
When CRM data and location data connect, auto brands benefit from true, measurable ROI from every marketing dollar spent
Today’s stakes are high for auto marketers: 48% of auto buyers spend one to three months shopping before a purchase. That’s a significant time frame, and one where potential buyers are exposed to a variety of marketing touch points, both in the physical and digital world.
Online advertising, TV, email, and even direct mail and out-of-home advertising play a part in propelling or inhibiting a potential buyer’s path to purchase. This means that the more auto brands understand audiences, the more equipped they are to implement marketing strategies that drive sales and definitively show return on investment (ROI).
Location data has become the foundation on which today’s auto brands are connecting disparate data sets, and building a new way of understanding consumer audiences. Location data is founded on the signals that mobile devices emit. In 2016, these signals represent more than 200 million U.S. smartphone users.
On its own, location data helps auto brands understand consumer audience movement—information such as the number of people visiting a dealership, the kinds of dealerships they’re visiting, the distance they travel to get to dealerships, and where they were before they arrived.
From there, third-party data such as TV viewership, CPG purchase data, and home ownership data greatly amplifies the benefits of location data. Of particular interest for auto brands is data from companies like Oracle Datalogix and IHS Automotive, both of which can layer on top of location data to provide insights about auto-focused audience affinities.
By using these types of sources, an auto brand can look at an audience that has visited a dealership and cross-reference with the types of cars they own, understand whether they are in market, learn the types of TV shows and networks they watch, and find out the products they buy at grocery stores.
The final component—and one of the most important—is first-party data, which is where CRM data comes into play. If you own a series of automotive websites or dealership websites, you can take online cookie data and anonymously bridge it to mobile devices to understand the correlation of people who are visiting a website, and see if they showed up at your physical dealership or your competitors’.
One major auto brand applied these principles in the real world to achieve four goals:
- Increase dealership visitation in 10 DMAs;
- Generate key shopping actions, includingtest drives, credit applications, and trade-in appraisals;
- Increase purchase rate; and
- Learn more about audiences that took action.
Starting with location data, the brand identified an audience group that had recently visited certain dealerships, and delivered a month-long targeted mobile advertising campaign. These ad exposures were then connected to actual dealership visitation by observing the rate at which devices exposed to advertising appeared on dealerships versus untargeted devices.
The auto brand’s first-party CRM data was then matched to actual visits that were a result of the targeted mobile campaign and real-world activity, such as test drives and credit appraisals. In doing so, this brand received significant insights into dealership visitation, cross-shopping behavior, lot engagement, and, ultimately, car purchases. In this case, the brand was able to accurately measure an almost 20% lift in dealership visitation, and more than 1,200 verified sales tied to the initiative.
This isn’t the only example of how auto marketers can use location data in innovative ways. Some have turned to mediums such as addressable TV. Addressable TV is a relatively new concept in the industry, and primarily refers to the ability to target specific TV commercials at the household level. This level of granularity for delivering commercials to audiences is a rapidly growing slice of the TV advertising pie, especially for data-driven marketers with clearly defined audiences.
For the first time, auto marketers are measuring the impact of addressable TV campaigns through location data from anonymized mobile signals. With these signals, marketers can draw intelligent conclusions about how consumers react to addressable TV campaigns, and understand how an already-hyper-targeted TV ad impacts real-world visits to a dealership.
By using location as the connective layer for CRM and third-party data, auto brands are building a new way of understanding consumer behavior. They are using it to target, analyze, measure, and understand how auto buyers are interacting across channels. Armed with these insights, innovative auto brands are winning the race for consumer mind share and industry market share.
Dave Struzzi leads global marketing and communications efforts for PlaceIQ, a technology company at the intersection of mobile data, advertising, and location intelligence. For more than 10 years, Dave has brought innovative solutions to market through industry education, and grown the global footprints of brands via thought leadership, editorial content development, and more.