February 12, 2008

Web 2.0 advertising tactics and technologies are gaining traction among auto dealers, becoming an integral element of the marketing mix. Fifty-nine percent of auto dealers say they plan to use Internet video on their own Web sites during the next 12 months, up from the current 33 percent, according to a new study by The Kelsey Group, the leading provider of research, data and strategic analysis on local media, small-business advertising, mobile and vertical market advertising. During this same 12-month period, the percentage of auto dealers using customer ratings and reviews will rise from 29 to 43, and the percentage using social networking sites will rise from 15 to 33.

"These findings point to a significant disruption in the auto dealer advertising space," said Neal Polachek, chief executive officer, The Kelsey Group. "There are valuable opportunities for traditional and new media companies that tune into dealers' adoption of Web 2.0 technologies and align with dealers' online media-buying intentions."

In general, auto dealers are shifting more of their media mix online, with 62 percent planning to increase online media spending in the next 12 months, compared with only 17 percent for traditional media. Moreover, 46
percent of dealers will decrease spending on traditional media, compared with only 8 percent for online media.

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