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Contextual advertising revolutionizes the automotive industry

August 8, 2023

With contextual advertising at the helm, the future of car buying experiences is undergoing a remarkable transformation.

Buckle up

The automotive industry witnessed a jaw-dropping wave of progress in recent times, all thanks to the infusion of digital technologies that are revolutionizing every aspect of car manufacturing, marketing, and sales. Just last year, the US automotive sector spent a mind-boggling $12.42 billion on digital advertising, demonstrating just how important the digital frontier has become for the industry.

But amidst this dynamic landscape, there's one game-changing innovation that's making waves – contextual advertising. Imagine ads that are finely tuned to reach potential car buyers precisely when and where they are most receptive. Contextual advertising achieves this by tapping into factors like location, driving conditions, and individual preferences to create ad experiences that truly speak to potential buyers.

This approach is nothing short of a superpower for car manufacturers and dealerships. It supercharges their ability to ensure consumer privacy, relevance, and relevant experiences for potential car buyers. Gone are the days of one-size-fits-all ads – we're entering an era where each car buyer feels uniquely understood and catered to.

With contextual advertising at the helm, the future of car buying experiences is undergoing a remarkable transformation. So buckle up and get ready to embrace a whole new level of engagement and satisfaction as you embark on the car-buying journey.

Enhanced Effectiveness in Reach

In 2021, global spending on contextual advertising reached a staggering $178.3 billion, reflecting a growing recognition of its effectiveness in engaging consumers across diverse industries, including automotive. Projections indicate that this investment will more than double by 2027, soaring to an astonishing $376.2 billion.

Unlike dated advertising methods, contextual advertising leverages first or zero-party data and artificial intelligence algorithms to comprehend consumers on a granular level. Through the collection and analysis of vast amounts of data, such as location information, driving habits, and online behavior, advertisers can precisely target their ads to relevant audiences, all without the use of cookies.

For instance, individuals living in snowy regions might receive ads for all-wheel-drive vehicles, while those residing in warm coastal areas could be presented with ads for convertibles or electric cars. This level of customization ensures that potential car buyers receive advertisements that align precisely with their specific needs and preferences, significantly increasing the likelihood of engagement and conversion.

Empowering Car Buyers through Personalized Experiences

Buying a car is no simple task. It demands time, research, and a whole lot of decision-making. According to Cox Automotive, the average car buyer is anything but a casual shopper. In fact, they dedicate a substantial 14 hours and 39 minutes to researching, shopping, and finding the perfect set of wheels. Car manufacturers and dealerships have taken note and are now harnessing the power of contextually targeted advertising to capture these buyers during the crucial decision-making phase.

Potential buyers are provided with detailed specifications, customer reviews, and interactive elements that aid them in exploring different models and features. Additionally, interactive elements in ads, such as virtual test drives or configurators, allow potential buyers to visualize and customize their desired car, creating a sense of ownership and excitement.

By crafting tailored advertisements that address individual preferences and needs, advertisers seek to make a lasting impact on the minds of potential customers. This personalized approach not only saves time for consumers but also enhances their overall car-buying experience, fostering a stronger connection between buyers and the automotive industry.

Shaping the Future of Car Buying Experiences

Contextual advertising is set to revolutionize the landscape of car buying experiences. Leveraging cutting-edge AI algorithms and a vast array of data sources, advertisers will possess the capability to discern individual preferences and needs with remarkable accuracy. As consumers interact with various digital platforms and smart devices, subtle cues and behavioral patterns will be meticulously analyzed, allowing for the delivery of highly targeted and relevant advertisements. Contextual advertising will seamlessly integrate into virtual reality showrooms, augmented reality test drives, and voice-enabled smart assistants, culminating in a deeply immersive and tailored experience.

Real-Life Example: Audi

With the delay of 3rd-party cookie deprecation, the industry will be hanging on to this

identifier for a bit longer - at least until the urgency to go cookie-less kicks in again. But the elephant in the room we don’t like to talk about is that a large portion of internet users are no longer targetable via 3rd-party cookies today.
Challenge: With only one-third of Danish consumers targetable on the user-level, Audi Denmark saw competition intensifying over users considered to be in the market for a new car,

as well as premium automotive and business-related content they were expected to be consuming.

Instead of bidding for fewer cookies at higher CPMs and shifting to highly demanded content, Audi sought to identify novel, future-proof targeting strategies to effectively navigate market changes with a privacy-first approach.

Audi Denmark embraced Semasio’s Unified Targeting approach enabling them to seamlessly extend audiences to contextual targeting at the push of a button, in effect automatically adapting to any changes in user-level identifiability.

How did they do this?  Working alongside PHD Media Denmark, Audi Denmark ran two Unified Targeting test campaigns with Semasio.

Campaign 1
In Campaign 1 Audi targeted the persona of the most likely buyers and excluded the persona of the least likely buyers based on their typical media consumption patterns and socio-demographic characteristics, both on a user level (audience targeting) and page-level (contextual targeting).

Campaign 2
In Campaign 2 Audi used its 1st-party data to model and target more users with similar semantic profiles to the actual converters. Additionally, these 1st-party audiences were projected onto contexts using Semasio’s Contextual Audience Extension, which identifies sites and pages where the converters are greatly overrepresented. To compare Audience Extension with Contextual Audience Extension, targeting strategies were again split into identifiable and non-identifiable devices.

In Campaign 1, Audi generated 70% of total conversions through the novel Audience and Contextual Exclusion of the least likely buyer persona. In Campaign 2, both 1st-party-data based targeting strategies – the more traditional Audience Extension and the novel Contextual Audience Extension – outperformed inclusion strategies of the most likely buyer persona in Campaign 1, reducing eCPA by 59% and 81% respectively, and proving to be as effective as exclusion strategies.

Through both Unified Targeting campaigns, Audi Denmark has demonstrated that novel targeting strategies such as excluding consumers not in the market to buy a specific car model or least likely to purchase one is an effective, privacy-friendly way to reach new prospects and content not captured by more traditional targeting methods. Additionally, seamless extension of modeled 1st-party data to similar user profiles and content they have in common opened up new pockets of value for reaching the most likely buyers.

By combining advanced datasets with AI-powered predictive models, Semasio equips the auto sector with a complete contextual targeting platform that balances performance-driven and privacy-compliant practices with a targeted approach that significantly enhances reach, efficiency and ROI.

Key Takeaways

  • Contextual Advertising's Impact: Contextual advertising is a game-changing innovation in the automotive industry, leveraging data-driven insights to deliver finely tuned ads to potential car buyers precisely when and where they need them the most.
  • Enhanced Effectiveness: Contextual advertising's effectiveness is reflected in its significant investment growth, reaching $178.3 billion in 2021, with projections indicating it will more than double to $376.2 billion by 2027.
  • Personalized Experiences: Leveraging contextual advertising enables car manufacturers and dealerships to create personalized and relevant experiences for each potential car buyer, catering to their specific needs, preferences, and local market conditions.
  • Granular Targeting: Contextual advertising utilizes data analytics and AI algorithms to comprehensively understand consumers and target ads precisely to relevant audiences.
  • Real World Results: Semasio's Unified Targeting approach, including audience and contextual exclusion strategies and leveraging 1st-party data, led to significant improvements in conversions, reduced CPA for Audi Denmark by up to 81% and enhanced reach, efficiency, and ROI with a privacy-first approach.
  • Future of Car Buying Experiences: Leveraging cutting-edge AI algorithms and vast data sources, contextual advertising is set to shape the future of car buying experiences with highly targeted and relevant ads seamlessly integrated into virtual reality showrooms, augmented reality test drives, and voice-enabled smart assistants.
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