In this guest post, Andrew Birmingham, editor of Which-50.com, and Vaughan Chandler, executive manager of Red Planet (A Qantas Loyalty business), take a look at how the car you drive impacts the brands you buy into.
Most Australian car owners say their main car reflects their personality. For marketers far beyond the automotive industry that is a powerful insight. That’s because as you drill deeper into that idea, a simple thought manifests itself in very interesting ways.
Audi drivers for instance enjoy their gin, but not as much as Jeep drivers enjoy their Tequila.
Lexus drivers meanwhile love nothing more than hitting a few shots over the green, whereas the best place to find a Mercedes driver’s ride on a night out on the town is in the car park of the Sydney Opera House.
These are just some of the insights derived by the Red Planet analytics team through analysis of Red Planet research panel survey data and proprietary data sources.
Each fortnight Red Planet and Which-50 will drill deeply into different consumer segments to uncover some of the more interesting insights, and more importantly, to demonstrate how clever segmentation and targeting can maxmise marketing efficiency, reduce wastage, eliminate costs and broaden the market opportunity for brands.
This week we investigate the automotive market.
Did you know that roughly 12 per cent of adults are in the market for a new car every year?. That’s over two million Australians. Of these there are over 21,000 shopping for their next luxury car – each month. Curiously, these consumers prefer to buy their groceries from discount supermarkets.
It’s not unexpected that the people browsing for automotive financing are also looking at cars. But did you know they’re probably watching SVOD in the evening, or that they’re 135 per cent more likely to be looking for life insurance than others? In fact, these Australians are generally more financially conscious than others and are more likely to be looking at financial planning.
Among the other automotive findings:
- The consumers in this segment skew male, are middle-aged and less affluent
- Smaller cars appeal to females and younger members of the panel…
- …while the blokes love nothing more than a medium sized car or a sedan
- It’s young men who are overwhelmingly more likely (70 per cent) to be looking for sports cars and convertibles
- Audi and BMW appeal to affluent audiences regardless of their age
- Mitsubishi, Hyundai and Kia have across the board appeal.
All of this is interesting but how does it help a brand manager get the best return on their investment?
That’s where smart analytics comes in. By using regression analysis, Red Planet’s data scientists are able to build bespoke propensity models to help predict how people will behave. That’s important since this information can be leveraged to help determine the influential characteristics of people in the market for a new car.
Such insights help brands better deploy their marketing tool kits to reach similar consumers who are not yet customers or who are looking to switch to competitors.
As a consequence marketers are able to understand behaviours on an individual level rather than relying solely on vastly defined segments.
How might such an approach play out in real life and what are the budget implications?
Remember that traditional targeting reaches everyone in a demographic segment or post-code, irrespective of their propensity or capacity to convert. However, by identifying people most likely to convert based on their profile and behaviour, a marketer can target a more precise and relevant group of people and refine this further by targeting only the top 30-40 per cent.
And this is a key point. Behavioural segmentation captures the market opportunity that would have otherwise been missed by using only a demographic segment. It also reduces wastage of advertising budget that would have otherwise been spent targeting people who have no intention of converting, simply because they fit a demographic profile.
In an environment where marketing budgets are lean and standing out in a crowded landscape is becoming more challenging, understanding consumers and the best ways to reach them is key. And as always it’s sometimes good to check your assumptions at the door
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