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Auto Dealers to Increase Online Video, Web 2.0 Tactics in Marketing Mix

Web 2.0 advertising tactics and technologies are gaining traction among auto dealers: For one, 59% of them say they plan to use video on their own websites within the next 12 months, up from the current 33%, according to a new study by The Kelsey Group.

Moreover, by the end of the next 12 months, the proportion of auto dealers using customer ratings and reviews will have risen from 29% to 43%, and the proportion of those using social-networking sites will go from 15% to 33%, according to the surveyed dealers.

“These findings point to a significant disruption in the auto dealer advertising space,” said Neal Polachek, CEO of The Kelsey Group. “There are valuable opportunities for traditional and new media companies that tune into dealers’ adoption of Web 2.0 technologies and align with dealers’ online media-buying intentions.”

Also according to the survey:

• In general, auto dealers are shifting more of their media mix online, with 62% planning to increase online media spending in the next 12 months, compared with only 17% for traditional media.

• Moreover, 46% of dealers will decrease spending on traditional media, compared with only 8% for online media.

Detailed findings will be presented at the first annual Ward’s “Automotive Spring Training Conference,” presented by Autobytel, March 9-11, 2008, in Tampa, Florida, Kelsey said.

About the study: The Kelsey Group Auto Dealer study was conducted in February 2008 via online survey. The survey of dealer online advertising practices and intentions was performed to identify best practices and trends in dealer use of various internet advertising types. The sample comprised tier-three dealers (no OEMs or associations), with 71% of respondents identified as owner, principal, vice-president or general manager.