Why Automotive Manufacturers Should Rethink Over-Reliance on Resellers and Invest in Direct Marketing Strategies

Far too many automotive companies outsource their marketing effort to local resellers. While this tendency is understandable, it may also be short-sighted.

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Today’s auto manufacturers succeed only when they keep their finger on the pulse, adapting and evolving their products to match consumer needs. While automotive manufacturing technologies have certainly come a long way, marketing and sales strategies have remained somewhat stagnant, with most auto manufacturers as reliant as ever on resellers and other local distributors. While this emphasis on resellers has its advantages, it can result in a dearth of direct consumer insight as well as choppy brand messaging.

By shifting away from resellers and toward a more robust focus on direct marketing, automotive manufacturers can not only improve the quality of their product, but also advance their market positioning.

Why the Reliance on Resellers?

First, it’s worth noting that the use of resellers is not without merits. There are a number of reasons why auto manufacturers have gravitated toward this model, including:

  • Connections to local markets/roots in local communities.
  • Maintenance, financing, and other post-purchase services, more proximate to the buyer.
  • Brand representation via contact work with local buyers.

For all these advantages, though, the reseller model can also impede auto manufacturers from improving their brand position, keeping them from the kinds of direct consumer interactions that are vital for product development.

The Challenges of Relying on Resellers

In fact, there are several reasons why automotive manufacturers are disadvantaged when they rely too heavily on resellers.

Inconsistent Messaging

Resellers and local distributors can be incredibly inconsistent when it comes to representing the manufacturer’s value proposition; by relying on resellers, manufacturers actually concede a lot of the control they might otherwise have over their brand.

Limited Customer Engagement

If local resellers do all the marketing and sales work, it means manufacturers seldom have the opportunity to engage with buyers directly. This robs the manufacturer of important opportunities to solicit product feedback, which could be used for product iteration and improvement.

Missed Opportunities

More than anything, working with resellers just means squandered opportunities. Simply put, poor marketing efforts from resellers fail to capture the full potential of digital marketing channels.

The Dark Funnel and Missed Opportunities

One way to understand the missed opportunities that come with over-reliance on resellers is to consider the dark funnel.

What is the dark funnel, exactly? Basically, this refers to the portion of the consumer journey that happens before they complete any contact forms or engage with the brand in any capturable way. In other words, the dark funnel consists of potential consumers whose actions are effectively invisible to the manufacturer.

The dark funnel can potentially make up more than 50 percent of the entire consumer journey, in some cases in excess of 90 percent, which means there are lots of would-be customers with whom manufacturers cannot directly engage. As such, it’s crucial to shorten the dark funnel as much as possible, using robust digital marketing channels (including content marketing) to draw these consumers out of their initial research phase and into a more deliberate shopping phase.

One of the main causes for the longer dark funnel is over-reliance on resellers. Auto manufacturers who take on more direct marketing work themselves can shorten the dark funnel and take greater advantage of the full digital marketing toolbox.

Building a Direct Marketing Program

So what does it look like for automotive manufacturers to build a direct marketing program, allowing them to minimize their dependence on resellers?

First, it might mean working with an experienced automotive manufacturing marketing company to assess the full lineup of digital tools that are available. For example, auto manufacturers might employ SEO, content marketing, social media, and paid advertising in order to boost their visibility and generate more qualified leads.

Second, auto manufacturers must grasp the benefits of data-driven marketing. Implementing a robust data analytics program provides automotive manufacturers with the ability to track customer behavior, gather insights, and attribute leads to specific campaigns. All of this is close to impossible when relying too heavily on resellers to do the grunt work of marketing.

By taking on a direct marketing approach, automotive manufacturers can reap a number of benefits, including greater control over their brand as well as access to direct consumer insights.

Why Manufacturers Need a Long-Term Strategy

When shifting from a reliance on resellers to a more direct marketing approach, it’s pivotal for manufacturers to focus on the long-term.

In fact, long-term thinking is one of the primary vulnerabilities of resellers. Because most resellers are focused on juicing short-term sales, they have little investment in helping automotive brands grow over time.

To ensure their enduring success, it’s important for manufacturers to invest in a sustainable marketing strategy that nurtures relationships and enhances market penetration over time.

In recent years, a number of automotive manufacturers have successfully shifted from relying solely on resellers to building in-house marketing capabilities, resulting in better lead generation, customer engagement, and market positioning. This will increasingly become a must for any automotive manufacturer looking to remain competitive.

The bottom line: Far too many automotive companies outsource their marketing effort to local resellers. While this tendency is understandable, it may also be short-sighted.

To regain brand control and to cultivate long-term growth, it’s essential to invest in more direct automotive manufacturing marketing.

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