The marketing challenge of rethinking the auto show
When Audi unveiled its all-new electric-powered Audi e-tron SUV, it bypassed the carpeted convention center confines of an auto show. Instead, the automaker ferried 1,600 invited guests across San Francisco Bay from the Embarcadero to the historic Craneway Pavilion, where the vehicle made its global debut during a show that included Intel drones lighting up the sky to form Audi’s four-ring logo.
The glitzy event, staged late last year for journalists, dealers and other VIPs, was more appealing than an auto show reveal because “there is more that we can control,” says Shawna Burtscher, director of experiential marketing at Audi of America, who noted that at auto shows it must compete for time and space with other brands.
Audi’s decision illustrates how auto shows, once an imperative for brands looking to make a splash with new model launches, are facing scrutiny as automakers find other ways to create buzz and reach consumers. Attendance at U.S. auto shows fell from 6.9 million households in the 2017—2018 season to 6.5 million households in 2018—2019, according to Foresight Research, which consults with brands on auto show strategies. And automakers erected 200 fewer displays this season, according to the firm, which tracks 56 shows (including one in Toronto) during the season, which generally runs from October to April.
Cars at CES
Audi, Mercedes-Benz and BMW all skipped the nation’s most iconic show, the North American International Auto Show in Detroit, in mid-January. But all three luxury brands showed up earlier that month at the Consumer Electronics Show in Las Vegas, which has emerged as a popular venue for automakers to tout glitzy tech-like autonomous driving.
“The auto shows in general have faded to some degree—and to a high degree based on their own hubris. They didn’t see things like CES coming and becoming more of an auto industry show and more important,” says Mark Wakefield, head of the automotive practice at consultancy AlixPartners.
In a move to regain relevance, the Detroit show is undergoing a revamp and moving to June.
Still, auto show advocates say it’s too soon to write off the events as a retail force. Foresight CEO Steve Bruyn points out that they still draw serious buyers: 60 percent of attendees come to shop for a vehicle, according to the firm’s research. But he advises that brands skip the glitz and return to the basics, like organizing test drives and deploying product specialists.
He recalled watching one car-show attendee taking a careful look at a vehicle with a specialist, but then cutting the viewing short because the person could no longer hear after a rock band began playing at that brand’s display area. “The old axiom the car is the star—that is true ... and the product specialists are the supporting cast,” Bruyn says.
Not dead, just changing
Of course, with the automotive market slowing after a run of strong sales, money is getting tighter, prompting brands to make tough choices about where and how to spend their experiential marketing dollars. “Auto shows are not dead, they just are going to change a bit and maybe not all the players will be in,” says Autotrader analyst Michelle Krebs.
After announcing last year that it was pulling out of the 2019 Geneva Motor Show in Switzerland, Volvo stated that “automatic attendance at traditional industry events is no longer viable. We must tailor our communications based on how the options complement our messaging, timing and the nature of the technology we are presenting.” The automaker pointed to nontraditional reveals, like debuting its XC40 compact SUV at the 2017 Milan Fashion Week and unveiling its S60 sports sedan last summer in Charleston, South Carolina, at its first U.S. manufacturing plant. Volvo’s U.S. division declined interview requests about the strategy.
Meanwhile, BMW is diverting some of its car- show budget to its “Ultimate Driving Experience” road shows, which typically involve bringing about 100 cars to stadium parking lots, making them available for street drives and to speed through race courses, says Paul Ferraiolo, who leads experiential marketing for BMW North America. BMW expanded it from five U.S. cities last year to 16 cities this year in an effort to reach more buyers. “We bring the show to their town. They can learn about the car in a relaxed, stress-free environment with people that are there purely to educate them,” Ferraiolo says. At a car show, “you don’t have the space, you just can’t do it.”
Bringing autos to the masses
Mercedes-Benz USA operates a traveling retail exhibit program that it calls “Brand Center” in which the automaker temporarily rents space in shopping centers for about a month, filling them with new models and interactive displays. The current one in Seattle’s University Village includes a virtual-reality racing game that can be played from behind the wheel of a GT sports car.
Mercedes has made previous stops in Miami, Chicago, Philadelphia, Minneapolis, Atlanta and Costa Mesa, California—all spurring a total of 1,800 vehicle sales at local dealerships, according to the brand. The automaker staffs the brand centers with product specialists who feed leads to dealers, and then Mercedes tracks sales in the months following.
The program allows the automaker to bring its vehicles “to the masses” more so than “what an auto show maybe traditionally would bring us,” says Monique Harrison, who heads brand experience marketing at Mercedes-Benz USA. Still, while the luxury brand skipped the Detroit auto show, it remained active at two other high-profile shows in New York and Atlanta, Harrison points out.
The decision to skip shows is not clear-cut, with various factors at play, including the timing of new vehicle launches. Ford remains committed to auto shows, but the automaker is adding modern touches, says Crystal Worthem, who manages Ford’s auto shows and global events. In a move to entertain younger buyers, it puts Animoji-style chatbots on screens inside some of its vehicles on car-show floors that answer product questions. Product specialists control the responses from an unseen location. Millennials “don’t want to come and just look at cars on carpet,” Worthem says.
Cadillac is actually boosting its auto show presence as it enters a phase of more frequent model launches. The General Motors brand plans to be at 20 U.S. shows in 2019—2020, including regional shows like Cleveland, Minneapolis, Phoenix and Denver, up from five this past season.
“There aren’t many places [where you can] get in front of as many people as some of the auto shows provide,” says Cadillac Global Chief Marketing Officer Deborah Wahl. But she says shows are less important as media outreach since the rise of digital media, like video streaming, gives brands new ways to gain free publicity.
In March, Cadillac revealed its CT5 sedan using a social media campaign that included videos using autonomous sensory meridian response, or ASMR, which is a technique of using sounds to trigger spine-tingling sensations. The “Sensory Symphony” campaign included scenes like a camouflage wrap slowly being peeled away to reveal the new sedan’s exterior. The sedan was officially put on display at the New York International Auto Show in April.
To be sure, auto shows still attract sizeable contingents of media members, including hardcore auto writers. Detroit’s show in January drew about 4,600 media members, although that was behind the recent peak of 5,000, according to Doug North, chairman of the 2020 show, which is put on by the Detroit Auto Dealers Association.
But journalist attendance at auto show “media days” matters less, in some respects, because brands are now streaming their reveals on their own channels on platforms like YouTube.
At the New York show, Hyundai drew more than 71,000 YouTube views, including 5,500 live viewers for its onstage presentation revealing its new Venue crossover. Combined with articles written about Hyundai, the automaker says it drew nearly 260 million impressions for an event that cost it $2 million. The streamed presentation included a highly produced video showing the vehicle zooming through an urban scene embellished with graphical elements that made the surrounding buildings look as though they were dancing.
Of course, that pales in comparison to the stagecraft pulled off during the glory days of the Detroit show—like in 1992 when Chrysler debuted the Jeep Grand Cherokee by driving it up the stairs leading to Cobo Hall, right through a glass window. In 2008, the automaker unveiled its redesigned Dodge Ram by driving it through downtown Detroit, led by a herd of 120 longhorn cattle.
But if those over-the-top stunts never come back, it’s fine with North: “We don’t think it’s necessary to be having Jeeps go through the windows, or that kind of thing, which adds enormous costs to displays.” Consumers, he says, might “enjoy seeing things like that, as well as the media.” But “they really are more concerned about understanding the products and how they might fit in their own world.”
Detroit’s auto show seeks sunnier days
Organizers of the Detroit auto show are trying to hang an air freshener on the event by moving it out of dreary January into sunny June. The next one won’t be until 2020, when organizers are planning both indoor and outdoor displays in and around the Cobo Center. That will provide more room for test drives to show off new technologies like self-driving cars, organizers say. The show is also being shortened from 14 to 12 days, while reducing the amount of time available for brands to set up their displays, which, as Crain’s Detroit Business has reported, should encourage more cost-efficient and smaller displays. The shorter window will give brands “a lot more opportunity to get a better return on their investment,” says Doug North, chairman of the 2020 show, which is put on by the Detroit Auto Dealers Association. Remember to pack your driving shorts.