No Brakes for Car Dealers' Online Ad Spend

Nearly two-thirds of car dealers plan to increase their online ad budgets next year, according to a recent Cars.com dealer poll.

In its monthly dealer newsletter, Cars.com asked dealers about their online advertising plans for 2007. More than 20 percent said they will maintain their current spending levels, while 18 percent expect to spend less.

“Dealers increasingly recognize the value of Internet advertising and the exceptional return on investment it offers, particularly when compared to radio, outdoor and direct mail programs,” said Mitch Golub, president of Cars.com. “Unlike these other media, effectively placed Internet advertising reaches more in-market car buyers and drives more high-quality traffic to dealer stores.”

Despite worries earlier this year sparked by Yahoo’s third-quarter slowdown concerns, the auto industry is still spending money online, according to Golub.

Recent studies from eMarketer and other researchers also call for continued growth. The latest numbers from eMarketer for the automotive industry estimate auto companies will nearly double their online spending in two years, going from $1.4 billion in 2005 to $2.7 billion in total online advertising in 2007. TNS Media Intelligence reported automakers doubling and tripling their online ad spend this year.

Cars.com is an online automotive classifieds and research site owned by several newspaper companies, including Belo, Gannett, McClatchy, Tribune and The Washington Post, via their Classified Ventures joint venture.