With purchase cycles spanning weeks and customers encountering hundreds of auto ads, it can be difficult to differentiate yourself from the competition. Add the slow demise of 3rd-party cookies, and it’s never been harder to get your ad in front of your target customer. CTV is helping fill the void.
Aside from purchasing a home, buying a car is one of the biggest and most time-consuming financial decisions a person can make.
In March 2024, the average price of a new vehicle in the US was $47,218. New vehicle buyers also spend an average of 11 hours and 45 minutes before making a decision, and the number is even higher for used-vehicle buyers, who reportedly take over 14 hours before making a purchase and driving off the lot.
These days, the journey often begins online, with a buyer researching a vehicle or service in-depth before scheduling a visit to a dealership.
That presents a problem for auto advertisers. With purchase cycles spanning weeks (if not months) and a customer encountering hundreds of ads along the way, it can be difficult to differentiate yourself from the competition. Add the slow demise of 3rd-party cookies, and it’s never been harder to get your ad in front of your target customer.
Thankfully, connected TV (CTV) is helping fill the void.
Millions of people are cutting ties with their cable providers, making CTV the fastest-growing major ad channel in the US, with 88% of US households owning at least one internet-connected TV device.
CTV provides the best of linear TV and digital advertising, allowing auto advertisers to target high-engagement ads directly to consumers while they’re watching their favorite programs. And, with 55% of viewers using free ad-supported (FAST) streaming platforms to watch TV in the past year, there have never been more opportunities available to market to them.
Here are seven reasons why CTV deserves a spot in every auto marketer’s media mix.
1. More Precise Targeting
With the decline of 3rd-party cookies, 1st-party data has never been more valuable.=
One of the major benefits of CTV devices is that they’re connected to the internet, meaning that auto advertisers can leverage 1st-party data collected through form submissions, in-store visits, previous purchases, and 1st-party cookies to target households directly using hard data like their IP addresses and device IDs.
This gives auto advertisers a unique opportunity to target customers one-to-one, as opposed to traditional linear TV campaigns, which often rely on contextual targeting alone to reach a broad target audience.
With CTV, auto advertisers can leverage 1st-party data to segment which users they want to target and cherry-pick individual IP addresses, ensuring the right messaging, make, or model of a car gets in front of the right buyer at the right time.
2. Increased Campaign Efficiency
Another benefit of the level of precision targeting CTV offers is its efficiency, which allows auto advertisers to drive sales on less volume relative to linear TV.
With CTV, you don’t have to buy millions of impressions to make a sale. You can pick and choose who (and how many people) you want to target directly, use frequency caps to prevent oversaturation, and actively track the impact of campaigns using digital metrics like video completion rates to optimize advertising spend and overall campaign efficiency.
The cost per impression is often higher, but you’re wasting less media spend overall by targeting customers who have already shown interest in your brand or product.
3. Democratization of Premium Content
In the past, it was nearly impossible for anyone but auto dealer groups to do any meaningful advertising at scale on a regional level. Traditional linear TV advertising required certain minimum spends that were often too high for small businesses, and it wasn’t easy to deliver ads that were targeted and personalized to local audiences, especially on premium channels.
CTV levels the playing field. It reduces the barrier to entry by allowing smaller dealers to bid on premium inventory through major streamers like Netflix, Disney, NBCUniversal, Paramount, and Max. This allows advertisers to deliver highly targeted ads while buyers watch popular shows like Yellowstone or stream major sporting events like Formula 1, all at a fraction of the cost of traditional linear TV campaigns.
4. Cost-Effective Creative Versioning
Building creatives is hard, plus you need to consider time and cost. Dealership levels also fluctuate, making it even more difficult to create versioned creatives that include accurate details like which year, make, model, trim, and price are available.
As a result, most local brands go broad with their messaging or piggyback off corporate ads to entice buyers, which can limit the appeal of buying from a local dealership.
It’s important to choose a DSP that makes it easy for smaller businesses to build and launch CTV ads at scale. That way, local auto dealers can target buyers using ads with inventory-specific messaging that are actually relevant to prospective customers in the community.
5. Higher Levels of Engagement
Car specs matter to customers. But ultimately, it’s the emotional response they have while watching an ad that lures them to the lot.
Engagement drives sales, and unlike other digital ad formats, CTV reaches customers when they’re often the most engaged: during their downtime, watching their favorite TV shows, sporting events, or movies.
That, coupled with the high-octane visual storytelling generally associated with car ads, means auto marketers can capture a customer’s attention directly in their homes and prime them to make a purchase. In fact, 81% of CTV users say their shopping decisions have been influenced by a CTV ad.
6. Unparalleled Flexibility
Unlike with linear TV, where advertisers would often buy supply in bulk and wait weeks, if not longer, to receive performance reports, with CTV, you can pump the brakes and change direction in near real-time.
That’s beneficial for car manufacturers and dealers. Over the past few years, supply chain issues and high demand for both new and used vehicles have caused inventory levels at dealerships to fluctuate wildly.
With CTV, auto advertisers can pause and adjust campaign strategies even when an ad is in-flight based on performance and real-world demand, allowing for even more dynamic and responsive marketing.
7. Enhanced Interactivity
Although still in its infancy, CTV ads are proving to be an even better alternative to linear TV ads due to their interactivity.
Thanks to the functionality of devices like Apple TV and Roku remotes, viewers can click on in-stream ads. This allows them to do things like input their email address, quickly scan a QR code, or get redirected to a website—either on their phone or the connected TV device itself—to learn more about a product.
For auto advertisers, this means it’s even easier for prospective customers to book a test drive or request more information about a particular model without them ever having to leave their couch.
Putting Auto Advertisers in the Driver’s Seat
Thanks to its sophisticated targeting capabilities, overall efficiency, and accelerating growth, there’s never been a better time to incorporate CTV into your media mix. Auto advertisers should prioritize adding it to their multi-channel strategy—those who don’t risk getting left in the dust.