JD Power, MarketShare Offer Way for Automakers To Balance Spending

Model Claims to Offer 'Optimal Mix' Of Incentives and Advertising

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Finding the right balance of spending on marketing campaigns and incentives can be tricky for auto executives.

MarketShare says it has worked with six automakers including Ford.
MarketShare says it has worked with six automakers including Ford.

So J.D. Power and marketing analytics company MarketShare have teamed up to help sales and marketing leaders achieve that balance, Automotive News reported today.

Historically, it's been difficult to evaluate these categories side-by-side and find the ideal investment mix between the two, said Thomas King, J.D. Power's VP of the Power Information Network.

Typically, $3 to $5 is spent on incentives for every dollar of advertising, although it varies among automakers, according to MarketShare.

"Both of those activities have the potential to help manufacturers sell more vehicles, but one of the challenges is how do you find the optimal mix between those two categories of spending," Mr. King said in an interview.

J.D. Power and MarketShare will connect data, tools and reporting from J.D. Power's PIN and MarketShare's DecisionCloud to bridge the marketing/incentive gap in an effort to drive more sales.

PIN helps automakers set vehicle incentives with sales, pricing and incentive reports using transaction data collected from dealerships.

MarketShare DecisionCloud uses analytics to optimize promotional spending through methods such as marketing-mix modeling and cross-channel attribution.

Marketing-mix modeling helps advertisers allocate spending across platforms such as TV, radio and print. Cross-channel attribution helps determine which ads should be served to people at the individual level, whether it's online or mobile.

MarketShare says it has worked with six automakers, including Ford, that have used its tools to guide advertising and marketing.

"In the incentive world, a huge amount of hard science and research has gone into, on the PIN side, helping companies understand how much to invest," MarketShare CEO Jon Vein said in an interview. "On the advertising side, while we at MarketShare have included what the incentive spends are, we've never been in a position to show the trade-offs between the two."

Vein added, "If you can unify these two different investments into the right balance, there are hundreds of millions, if not billions, at stake to do this the right way."

Vince Bond is a writer for Automotive News

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