What Is The Difference Between Tier 2 and Tier 3

Tier 2 Automotive Versus Tier 3 Automotive

If you’re new to automotive marketing, you will need to know the difference between tier 2 and tier 3 automotive marketing. Dealers benefit from using these types of marketing campaigns to promote the cars and services they offer at their dealerships.

The main difference between the tiered automotive strategies is that tier 2 is at a group level meaning your dealership is advertised together with other OEM brand dealers within your region, and tier 3 is at an individual level which is focused on only advertising your dealership by itself.

What is Automotive Tier 2 Marketing

Tier 2 automotive marketing is a collaboration between the auto manufacturer and their designated dealers that represent the brand. Dealerships get regional and local exposure from tier 2 advertising campaigns as a group. Ad campaigns created for tier 2 marketing will include other dealerships in your designated marketing area.

What is Automotive Tier 3 Marketing

Tier 3 automotive marketing ads are specifically focused on promoting only your dealership in the local marketing area. Tier 3 campaigns are dealer-level ads and focus on promoting the dealership without including other competing dealers who represent and sell the same brand as you. These ads focus on bringing car buying leads to only your dealer location.

Automotive Tier Marketing

If you are considering creating tier 2 or tier 3 automotive campaigns, you’ll want to ensure you set them up correctly to get reimbursed by the OEM. Some of the best online and television campaigns that result in high ROI use a combination of both types of marketing campaigns. Tier 2 ads are great for getting your dealer’s name and location advertised while tier 3 ads are better for marketing vehicles you have in stock and promoting your service and parts department.

Do OEMs Pay For Tier Marketing Campaigns?

When an OEM pays for tiered marketing campaigns, it is called a co-op reimbursement. Reimbursements can range from 30% of the ad budget to as much as 100%. Using co-op marketing helps drive down the cost of advertising which allows your dealership to reach more car shoppers in your local area across multiple channels. OEMs who provide co-op advertising opportunities give their participating dealerships a competitive edge over those who choose not to do tier 2 or tier 3 automotive marketing.