Experiential Marketing in Automotive Industry

Engagement Marketing - Inspiring practical approach to creating strong bonding between the customer and brand

Part 1 Critical review of recent findings in research

Experiential marketing is a marketing discipline which has been growing rapidly despite the fact that it is relatively young. Experiential marketing (also known as engagement/live marketing) is a practical advertising approach that primarily focuses on consumers’ experience. Engagement Marketing is used to immerse consumers within the experience of a product or service by implicating and emotionally enhancing as many human senses as possible. (Smilansky, Shaz. "Why Experiential?" Experiential Marketing: A Practical Guide to Interactive Brand Experiences. Kogan Page, 2009. Print.)

Recent marketing studies asserted that traditional marketing techniques are losing effectiveness and are no longer appealing. According to McKinsey and Co. “TV advertising will be only third as effective as it was in 1990 due to increasing advertising costs and dramatic reduction in viewing figures”. ("Experiential Marketing." Marketing Made Simple. Web.)

Compared to mass media marketing campaigns, experiential events have taken the communication aspect to a much more personal level. Companies that practice experiential marketing achieve deeper levels of emotional engagement and turn it to influential memories that will generate more intimate brand perception, motivate buying decision and thereby gain customer loyalty.

Unlike traditional advertising, live marketing concentrates on the quality, not quantity. This aspect is the essential strategical basis of experiential marketing. Brands will invest less amount of money on the one-off marketing event aiming at reaching smaller number of consumers. However, the results they get from small-scale interactive promotions will be more authentic and meaningful. For instance, publishing advertisement in a newspaper with half a million people audience is reasonable but it does not guarantee that half a million people read the commercial message inside. Traditional marketing is definitely more conventional and has a wider spread of targeted audience. Yet still the most recent experiential marketing trends emphasise on realistic impressions created exclusively between the brand and the consumers. (Schmitt, Bernd. Experiential Marketing: How to Get Customers to Sense, Feel, Think, Act, Relate. 2000. Print.)

Another reason why experiential marketing is beneficial for brands is because it is likely to spark off the word of mouth and media multiplier effect. This means that as long as the engagement marketing interaction campaign is designed with a relevant and unconventional approach and the idea behind the interaction represents the brand’s values in a way that is comprehensive and interesting to consumers, people would be more into sharing the personal experiences they had in social media, encouraging interest growth and new customer involvement and, therefore, enhance the overall awareness regarding the brand and it's specialties. In other words, if experiential events are successfully planned and implemented in a way that makes people engage with the brand, this will enrich the entire marketing campaign and even induce the expansion through other promotional channels of ATL (TV, magazines, newspapers) or TTL (web marketing, social media).

Recent findings in experiential marketing motivate more brands to use engagement events in their marketing campaigns and dismiss the traditional marketing. One of the lately developed theories about consumer experience is based on the idea of Need for Confirmation. Marketing psychologists believe that people are latently looking for confirmation and validation of actions and ideas in various spheres of their everyday life. The majority of people are very busy and their lives are very often filled with a number of daily routines, problems and lack of time for interaction with anything outside their professional life and other engaging activities. People want to be entertained, challenged and emotionally affected by experiences that they potentially want to have in their life. Customers intend to be closer to brands and realize that brands have something to offer in return. The idea of this theory lies upon giving the customers choices or solutions to their problems and showing how they operate in practice. This is done by engaging customers in the straightforward illustration of how the product or service will improve their lives. However, this can also be done by sending a certain message to people through the creatively integrated association and suppositions that the event wants to promote. (Mark Li Fo Sjoe. "Experience Marketing." November 2015. PowerPoint presentation)

Another theory that marketers have elaborated suggests that experience during post-purchase consumption is the key determinant of customer satisfaction and brand loyalty.

Experiential marketing techniques help companies perform the product experience before the actual purchase to convince customers that the product or service is special and able to alter their lives for the better. This theory makes another point in favour of experiential marketing over traditional advertising. In fact, traditional marketing only focuses on persuading that gets customers to buy the product or pay for the service. However, it doesn’t pay much attention to what happens later. Experiential marketing is the right approach to make potential customers internalize a sense of how their personal life is improved by the brand.

Studies conducted by the Event Marketing Institute illustrate that 93 percent of consumers believe that experiential marketing events are more effective than mass media ads¹. 89 percent said that such events improve their understanding of a product more effectively than other commercials². 74 percent of consumers involved in the observation admitted that experiential marketing events had had a positive impression on their perception of the marketed brand³. (Wegert, Tessa. "It's Time to Experiment with Experiential Marketing." Clickz Marketing News & Expert Advise. 14 May 2015. Web.)

The latest development in experiential marketing is the advent of installations and engagement events that create memorable interactions between the brand and consumers enhanced by high- tech. The original concept encompasses different types of experimental marketing expressed at outdoor exhibitions and displays, competitions, consumer events, street performances, digital or real time games. Following the latest innovations, experiential marketing agencies are now creating engaging and interest events making use of real-time technology, augmented reality, interactive displays etc.

The most valuable of the latest tips that live marketing experts gave on how do experiential marketing included striving to do something no one else has done before. This guarantees that the event is memorable. Experiential marketing has to appeal to the five human senses (sight, smell, hearing, touch and taste) to create a live connection with the consumer. To go viral, brands have to utilise technology and provide incentives for people to share pictures, hashtags and status updates about their campaign. ("10 Tips on Experiential Marketing." Gotta Be Marketing. 2015. Web.)

The most important aspect in engagement marketing is to carry out the experiential promotion as a part of a combination with other advertising techniques. For example, Halo used multiple communication techniques and engagement advertising in particular as part of their promotional campaign for the new game Halo 5: Guardians which was released 27 October 2015. Apart from teaser trailers, TV commercials, immense social media advertising they also announced a few tie- ins. Microsoft used Minecraft to market Halo 5. They made Halo 5 skins available in the special edition of Minecraft so gamers could play characters from Guardians. This promotion is an example of how a big brand can boost excitement and tease the fans before the release of the new game by giving them an opportunity to experience a part of the gameplay way before the release of the new product. Apart from getting more attention from video games lovers, there was another latent advantage of making this kind of promotion. By combining two successful games like Halo and Minecraft, publishers could potentially turn some of the Minecraft gamers into Halo players or vice versa. (Grubb, Jeff. "Microsoft Uses Minecraft to Market Halo 5: Guardians." Venture Beat. 19 Oct. 2015. Web.) This marketing action could be considered as experiential marketing because it practiced engaging specific target audience in a personal experience in which they internalized a sense of how playing the real game could feel. Another Halo 5 promotion was a cover art puzzle competition where fans were looking for pieces of a puzzle to revel what the cover art for the new game would be. Engaging customers in a competition is believed to be a promising experiential marketing strategy that stimulates emotional responses and strengthens brand loyalty.

Experiential marketing has been practiced by a lot of brands across different industries. Not long ago brands in automotive industry began moving away from traditional advertising and embarked in non-traditional channels such as social media advertising and experiential marketing. Since buying a car is a major investment and even a big part of drivers’ lives, personal experience is vital for customers. ("How Car Manufacturers Are Winning with Experiential Marketing." Hot Cow. 11 Apr. 2012. Web.)

It is interesting to see that automobile industry companies have been utilizing the concept of experience marketing for a very long time - in the form of test drives. However, in order for the potential customers to seek a test drive, they should already be interested, or at least aware of the car model. So now these companies are aspiring to reach out to their other, more valuable customer segment, which is the people who are not yet attracted by the new product. And to do so, companies are providing their users with other sorts of experiences to demonstrate the features or performance potential of the up-coming or fresh product.

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¹ Wegert, Tessa. "It's Time to Experiment with Experiential Marketing." Clickz Marketing News & Expert Advise. 14 May 2015. Web.

¹ Wegert, Tessa. "It's Time to Experiment with Experiential Marketing." Clickz Marketing News & Expert Advise. 14 May 2015. Web.

¹ Wegert, Tessa. "It's Time to Experiment with Experiential Marketing." Clickz Marketing News & Expert Advise. 14 May 2015. Web.