Strategic Marketing Approaches for Auto Dealers in Today’s Changing Market

What happens when tariffs reshape pricing, consumer confidence plummets, and 60% of potential buyers decide to delay their purchase? For auto dealers, this isn’t a hypothetical scenario—it’s today’s market reality.  

The traditional response might be to slash marketing budgets across the board. But industry leaders are finding that strategic marketing is actually more essential than ever in these challenging conditions. 

 The key difference is a shift from broad marketing approaches to precision targeting of the consumers who remain in-market despite broader hesitancy—a strategy that requires both nuance and access to real-time market data.  

Understanding Today’s Automotive Landscape 

Our April 2025 Market Pulse report revealed key insights into the current automotive market. Not only are we seeing a 38% increase nationwide in vehicle movement with minimal inventory growth, but regional differences are becoming increasingly important. East North Central, Middle Atlantic, and West North Central regions are leading the charge with some of the largest increases in movement, despite being the only regions showing a slight decrease (-1%) in available inventory. 

“We can attribute this spike to consumers rushing to purchase vehicles in anticipation of tariff-related price hikes,” notes Calvin Mesman, VP Solutions for Adpearance. “In March, demand outpaced supply, indicating we are back in a seller’s market for now.” 

While vehicle movement showed strong initial momentum, consumer confidence is now declining. According to a poll of more than 1,750 adults from HarrisX and Allison Worldwide, more than half of American consumers feel that now is a bad time to buy a vehicle. 

A separate survey by Oliver Wyman Forum found about 60 percent of respondents planned to delay or reconsider a vehicle purchase or to choose a less-expensive model. As Jessica Caldwell, head of insights at Edmunds, noted in a recent Automotive News article: “People will be trying to figure out what’s in their price range, and given the expected price hikes for some vehicles, what does that look like?” 

This environment requires thoughtful marketing strategies rather than blanket cuts. As dealerships face potential inventory challenges coupled with strong demand, how they position themselves in the market becomes crucial. 

The True Cost of Cutting Marketing in a Seller’s Market 

When inventory is moving quickly, it might seem logical to reduce marketing spend. But this approach can have significant consequences, especially in today’s paradoxical market where a sales surge coincides with declining consumer confidence: 

1. Missing the motivated minority: While recent data shows more than half of consumers feel it’s a bad time to buy, this means there’s still a substantial segment who ARE buying—evidenced by the 38% increase in vehicle movement. Without strategic marketing, you’ll miss connecting with these motivated buyers who are defying the broader market sentiment. 
2. Competitor advantage: If you reduce visibility while competitors maintain theirs, you risk losing your share of the shrinking pool of ready buyers. 
3. Loss of future momentum: Building a strong market presence is a long-term investment. Cutting marketing now can impact your dealership’s position when more hesitant consumers eventually re-enter the market. 

Smart Strategies to Maintain Impact While Managing Costs 

Strategy 1: Focus on High-ROI Segments 
Adpearance’s Market Pulse report reveals significant variations in how different vehicle segments are performing in the current market. For example, in March 2025, some segments like Mid-Size SUVs showed decreasing inventory but substantial increases in movement—signaling high demand that could justify increased marketing focus. This kind of segment-specific intelligence is crucial for making smart marketing allocation decisions. 

Instead of applying uniform budget cuts across all marketing initiatives, savvy dealers are analyzing segment performance alongside marketing channel effectiveness. When evaluating where to allocate resources, examine your CRM data to identify which traffic sources are closing at the highest rate. These high-converting channels should receive priority funding, while lower-performing sources are better candidates for budget adjustments. 

This approach creates a two-dimensional strategy: focus marketing dollars on both your highest-performing vehicle segments and your highest-converting marketing channels. By aligning spend with actual market performance, you can maximize ROI while maintaining visibility where it matters most. 

Strategy 2: Leverage Data-Driven Targeting 
In today’s complex market with conflicting signals, intuition isn’t enough. Real-time market data helps eliminate wasted ad spend by ensuring your marketing dollars reach the most promising customer segments—that crucial minority of consumers who are still actively buying despite broader market hesitancy. 

Marketing strategies and budgets should adjust based on actual movement in the market. The common approach of reducing advertising for segments with low inventory can be counterproductive if those vehicles are moving well in the market. This is where sophisticated data platforms like Adpearance’s MarketAI technology become invaluable, adjusting advertising based on real-time factors including market movement, popularity, time on-site, price, and trim levels. 

MarketAI helps dealers identify these optimal targets by analyzing real-time supply and demand data across markets, identifying exactly where in-market shoppers are looking. This precision targeting is especially valuable when consumer sentiment is down, but specific segments of buyers remain active, allowing you to allocate resources toward those most likely to convert. 

Strategy 3: Prioritize Aged Inventory Marketing 
While demand is high, there’s an opportunity to focus advertising efforts on aged inventory and segments that historically have not moved very well. 

Aged inventory typically sits on lots for specific reasons, and the solution is strategic visibility. These vehicles need maximum exposure to find the right buyer. An omni-channel approach that drives traffic and VDP views is particularly effective. Google Vehicle Listings, Display ads, and social media campaigns all generate quality traffic. 

By increasing visibility for these vehicles during a period of high consumer interest, you can finally move these units that have been tying up capital on your lot. 

Measuring Marketing Effectiveness in Today’s Market 

With market conditions changing rapidly, the metrics dealerships have traditionally relied upon may not tell the full story. Consider enhancing your measurement approach: 

1. Beyond clicks and impressions: While digital engagement metrics like click-through rates and impression volume remain important, they should be evaluated alongside inventory-specific metrics, including turn rates by segment and average days on lot. 
2. Connecting marketing efforts to inventory movement: Track which marketing channels are directly influencing your fastest-moving and slowest-moving inventory, not just overall lead generation. 
3. Real-time adaptability: The market continues to evolve rapidly, requiring marketing strategies that can pivot just as quickly based on actual performance data. 

MarketAI technology is particularly valuable in this environment, as it scores vehicles and prioritizes them for advertising execution in real-time. This goes beyond the traditional categorical approach of allocating spend by model or segment, enabling deeper, more nuanced decision-making that responds to actual market conditions.  

Turn Market Volatility into Your Competitive Advantage 

The current market presents a fascinating dichotomy: surging sales amid declining consumer confidence. This presents a unique opportunity for dealerships that approach their advertising strategically. While the polls show growing consumer hesitancy, the 38% increase in vehicle movement proves that a significant segment of buyers remains active and motivated. 

Rather than cutting marketing budgets across the board, successful dealers are maintaining their market presence while being more strategic about allocation with tools like MarketAI. Logan Andrews, Senior Dealer Strategy Director at Adpearance, shares a valuable perspective:  

“Not over correcting and staying present in the market is key. We saw similar things during the inventory crisis post covid. Some dealers pulled back advertising due to the shortage and saved funds, while others stayed aggressive with their marketing. The latter kept their sales funnel full and ultimately kept their sales up with more opportunity as the inventory came back.” 

Smart marketing isn’t about spending more or slashing budgets—it’s about spending more effectively. By focusing on high-ROI segments, leveraging data-driven targeting, and prioritizing aged inventory, dealers can navigate today’s changing market with confidence. 

Ready to gain a competitive edge in today’s challenging market?

Connect with our team of automotive marketing experts for a complimentary assessment of your real-time market position. We’ll analyze your inventory, competitive landscape, and marketing strategy to identify opportunities for improved ROI and increased sales, even in changing market conditions.