Who Holds the Marketing Power in Automotive Marketing?
Who holds the power in automotive marketing? Is it large dealer groups with brand images spanning across multiple markets? Is it the advertising agencies who create and place more ad dollars for manufacturers than dealers ever will? Is it the vendors, with giant vendor conglomerates like Cox and CDK offering a huge range of marketing services? Or is it the intermediaries like Shift Digital and Urban Science working across manufacturers and vendors on behalf of dealers? All have be seen as threats to the average dealer. However, the greatest power continues to reside with the dealer’s OEM. Manufacturers decide who their agency will be, who gets to be a dealer, and increasingly which vendors can sell to their dealers. Just six years after GM and Chrysler filed for bankruptcy, those manufacturers and most others exercise more control over how dealer advertising dollars are spent and how brand standards are upheld than was the case when GM, Ford, and Chrysler were all among the 10 largest companies in the nation. Usually the most profit in the distribution chain can be found where the most power resides. That’s not necessarily the case in franchise systems. Dealers can make a lot of money if they know what manufacturer preferences to give in on and which are merely guidelines.