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Cars.com Launches $26M Ad Campaign

Magazine article Editor & Publisher

Cars.com Launches $26M Ad Campaign

Article excerpt

With additional reporting by Rob Lenihan.

Hoping to become the Rolls-Royce of Web automobile sites, the newspaper industry's cars.com has jump-started an 18-month, $26 million advertising campaign, to be managed by Stein Rogan + Partners of New York City. The campaign is one of the largest ever by a Web-based company, according to Competitive Media Reporting, a New York City-based company that tracks media spending.

The parent of cars.com, Chicago's Classified Ventures, won't be shelling out $26 million in cash, however. Much of the advertising will come from free in-kind placements with local newspaper partners, according to Greg Stuart, vice president for marketing. Nonetheless, the impact of this advertising in large daily newspapers will be real, Stuart insists.

CMR reports that AT&T's online services division was the biggest promoter of Web-based services, spending $76.1 million on direct consumer advertising in 1997. America Online ranked second with $41.4 million. The largest advertising expenditure last year for a Web-based company was by autobytel.com inc., a competitor of cars.com. Irvine, Calif.-based autobytel.com spent $5.1 million in 1997, according to CMR. The company's president and CEO, Mark Lorimer, says the firm will spend $20 million on ads by the end of this year.

The sudden increase in spending is a sign of heightened competition in the market. Besides autobytel.com, cars.com must also compete with AOL's AutoVantage service; AutoWeb in Santa Clara, Calif.; Microsoft's CarPoint in Redmond, Wash.; CarCast from PowerAdz Corp. in Troy, N.Y.; and AutoConnect, a new Atlanta-based service owned jointly by Cox Enterprises and Automatic Data Processing Inc.

"We're setting out to become the brand for car Web sites," said Stuart at cars.com. Stuart believes none of his competitors have yet to build strong brand identities. He wants cars.com to become as well-known among consumers as names like Yahoo! and Amazon.com.

This is an ambitious goal for a company that didn't launch officially until June. When Stuart joined the company four months ago, only a dozen local newspaper affiliates had signed up with the service. Today, 140 affiliates are on board, and the company plans to roll out to more local markets in the coming months.

In contrast, both autobytel.com and CarPoint have been around since 1995. To

date, autobytel.com has served over 1.6 million car buyers. Autobytel.com's president compliments cars. …

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