Marketing Forecast from Ad-ology

Auto makers and dealers have long relied on repeat business to drive a significant portion of their sales. But lately, more consumers are switching brands. These defections have caught the auto makers’ attention and they’re changing their promotional strategies to appeal to both old and new customers.

The average age of light vehicles on U.S. roads keeps rising, reaching a record high of 10.8 years in 2011, according to new research from Polk. For service and parts providers, the increasing age of the vehicle fleet, as well as the increasing length of vehicle ownership, could mean more business. However, analysts expect to see a reversal of the lengthening average age as new car sales rise.

Ford Motor Company recently took top honors for the second year in a row during the 16th annual Polk Automotive Loyalty Awards. Ford was a repeat winner in several categories; Hyundai was recognized for the first time. Even though industry volumes have been down the past few years, loyalty rates have continued to increase.

Globally, automakers are expecting a strong 2012. Demand in the U.S., the world’s third largest market, will be solid, but outpaced by faster-growing economies. This year, U.S. automakers will likely be revving up their ad budgets to compete with international manufacturers who have set aggressive targets in the U.S. market and they’ll also be promoting luxury vehicles and lease financing.

As 2011 comes to an end with the pace of auto sales accelerating, industry analysts expect the trend will continue in 2012. An estimated 13.6 million new cars and trucks will be sold in 2012, as many consumers still have pent-up demand for new cars. Improved selection and loosening credit conditions will also help entice buyers.

By 2012, Gen Y consumers will account for approximately 40% of the car-buying population and represent a new breed of confident consumers who are independent, tech-savvy, engaged and demanding, according to a new survey by Deloitte.  Conducted in collaboration with The Eli Broad Graduate School of Management at Michigan State University, the survey indicates thatRead the Rest…