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As Automakers Increase Adspend, Insufficient Inventory Available

As automakers increase their online spends in upcoming months, the inventory shortage will become “pretty severe,” according to Mitch Lowe, CEO of Jumpstart Automotive Media, a network of auto-related sites.

General Motors and Ford are planning to increase their digital spending, and local dealers are beginning to join the online advertising marketplace - all of which means that inventory, already scarce, will become even more so, writes Mediaweek.

There are two types of automotive inventory online - endemic sites that reach consumers already in the market for a vehicle, and sites where brands attempt to reach a wider audience or an audience of a particular lifestyle. The in-market sites are those in which inventory is most scarce, and for those sites, brands are purchasing a full year’s worth of space, in TV-like “upfronts.”

Cars.com, for example, has sold close to 88 percent of the site’s inventory for the next year, and brands are increasing their budgets anywhere from 20 percent to 100 percent.

Because of the tight conditions, automakers are extending their reach throughout the web, increasing their paid search campaigns and expanding their tests of various media such as video and social network sites.

eMarketer predicts that automakers will account for 15 percent of all U.S. internet advertising spending in 2007.