UNIVERSITY PARK, Pa. — According to a research team led by the Penn State Smeal College of Business, digital marketing campaigns launched by regulators to entice consumers to comply with automotive recall requests can improve compliance, save money money and maybe even lives.
In their study,Regulating Product Recall Compliance in the Digital Age: Evidence from the “Safe Cars Save Lives” Campaignthe team looked at the Safe Cars Save Lives digital marketing campaign (DMC) launched in 2016 by the National Highway Traffic Safety Administration (NHTSA). The DMC has sought to raise consumer awareness of automobile recalls by providing information to vehicle owners through paid search and online display ads. On average, the initiative increased the number of vehicles repaired per non-airbag recall by 20,712 compared to what was expected without the campaign. Its effect was even greater for recalls related to airbag inflators, a key finding given the scale of the Takata airbag inflator debacle that has dominated headlines in recent years, the researchers said.
The increase in the number of vehicles repaired has more than just an economic effect, said Sotires Pagiavlasassistant professor of marketing at Smeal College of Business, who was the lead author of the paper.
“Previous research has shown that for every one percentage point increase in the repair rate of recalled vehicles, the number of vehicle accidents over the next three years decreases by 0.46%,” Pagiavlas said. “With our findings examining how NHTSA’s digital marketing campaign improved consumer recall compliance, we can therefore expect that the significant increase in vehicle repairs as a result of the initiative is also likely related. unless there are associated accidents and fatalities.”
The impact of “Safe Cars Save Lives” is magnified when you consider that there are around 900 vehicle recalls a year, the researchers said. In 2020 alone, there were 786 automotive recalls, affecting nearly 32 million vehicles.
NHTSA launched its campaign in January 2016 to improve low consumer recall completion rates in the wake of growing challenges. The “Safe Cars Save Lives” campaign was a nationwide digital marketing initiative that aimed to entice consumers to use NHTSA’s recall search web page, encourage them to check for open recalls, and then repair their defective vehicles quickly.
“Safe Cars Save Lives” was designed like other digital ad campaigns, which use a mix of methods, Pagiavlas said. In this campaign, officials bought keywords related to car recalls so that people who used search engines to search for information online could be presented with a sponsored link at the top of their search results, leading them to the NHTSA website.
“When people searched, for example, ‘Is my vehicle being recalled? they were likely to see an NHTSA ad at the very top of their search results,” Pagiavlas said. “They could then click on that ad and go directly to NHTSA’s recall search web page. With the vehicle identification number of their car in hand, they could search to see if their vehicle had been recalled and what they needed to do to get it repaired.
Pagiavlas added that NHTSA officials have also purchased online display ads on social media sites, such as Facebook, to also raise consumer awareness of the recalls.
More than the minimum
According to the researchers, who report their findings in a paper recently accepted at the marketing magazine, automakers are required to notify consumers of recalls of their vehicles, but company efforts often only meet what the law requires and fall short of initiatives such as “Safe Cars Save Lives.” Manufacturers may fear the impact of a recall on their stock price or the perception of their brands in the media.
However, researchers have found that while automakers may try to avoid drawing attention to recalls, media coverage of recalls in the popular press can work with digital marketing campaigns to increase compliance with recalls. by consumers.
“We found that media coverage helped improve safety outcomes by increasing the effectiveness of DMC,” Pagiavlas said. “In other words, the digital marketing campaign had more impact for recall campaigns that received greater media coverage, suggesting that these two media formats can work synergistically to improve recall compliance. consumers.”
This study therefore demonstrates other options for security managers who wish to educate consumers. The researchers also found that “Safe Cars Save Lives” was more effective for older vehicles, a class of products with historically low recall rates. Increasing recall compliance among owners of older vehicles has been a long-standing challenge for NHTSA, one that DMC has been able to meet.
“Evidence from the study could give agencies, such as NHTSA, leverage to ask Congress for more money in their annual budgets for digital initiatives that can have huge impact in a cost-effective way,” Pagliavlas said. “For agencies tasked with regulating industries with frequently recalled products, the impact of digital marketing campaigns could be substantial in preventing accidents and loss of life.”
Pagiavlas suggests that the current research could be used as a springboard for work on the impact of digital marketing campaigns in other contexts.
“Think of toys, dressers or kiddie pools, for example, that have a problem that needs fixing,” Pagiavlas said. “Each of these industries is where consumer compliance has often been quite low, directly leading to consumer injuries and fatalities. Our study is the first, to our knowledge, that shows that a digital marketing campaign initiated by a regulator can take matters into their own hands and receive a positive response from consumers.
To conduct the study, the researchers collected data from multiple sources, including NHTSA, LexisNexis, and ad$pender.
Pagiavlas co-authors were Kartik Kalaignanam, Moore Fellow and Professor of Marketing; Manpreet Gill, Assistant Professor of Marketing and Paul D. Bliese, Jeff B. Bates Professor of Management, all at the Darla Moore School of Business at the University of South Carolina.