Navigating the Realities of Early 2026
As we settle into the first quarter of 2026, the usual wave of “year-ahead” predictions has arrived. While forecasts are helpful for long-term vision, we find that the most successful dealerships stay grounded in what the data is telling them right now. At sMedia, our focus remains on providing clear, actionable insights derived from real-time campaign performance across North America.
The start of this year brings several encouraging shifts for those looking to optimize their reach. We’re seeing a digital landscape that is becoming more efficient for those who stay consistent, offering unique opportunities to connect with shoppers in high-impact spaces. Rather than reacting to the “noise” of the industry, we’re looking at three specific trends that offer an insightful path forward for your dealership’s digital strategy.
Higher Funnel Ad Platforms Will Provide Fantastic Value in Q1
December is always a competitive month in the digital ad space as everyone is trying to make a final push for the year, but as we get further into January, it is clear that a lot of companies have stopped advertising. This has had the effect of making the cost of digital ads drop sharply, and the value of marketing dollars is increasing rapidly. Here’s an example of what this looks like using the data from a TikTok campaign over the last 60 days:
You can see that after Christmas Day, the number of impressions that these ads were getting jumped significantly – the budget remained unchanged from December, yet it’s generating nearly double the impressions.
The trend continues with Meta, where impressions are (on average) up 20% while Cost Per Click is down 10% in January compared to December. Because there are fewer companies in all industries buying ads this month, ad dollars are going a lot further.
Knowing that the average car buying journey is 56 days, this wildly affordable ad market opens up the opportunity for dealerships to act aggressively and capture a larger segment of buyers who will be closing deals in February, March, and April or coming off leases.
Consumers Are Still Hyper-Focused on Price
If you’re feeling like the market is soft right now, you aren’t alone. A survey from Cox Auto* found that dealer sentiment has continued to decline and has reached its lowest point since Q2 of 2020, at the peak of Covid pandemic uncertainty.
While there are a lot of different factors affecting consumer confidence, there are significant signals that consumers are putting price as the single most important factor in all their purchases*, no matter how small the margins are.
Studies have shown that price has consistently been one of the top three factors for car buyers, but it is increasingly becoming more important as economic factors squeeze in-market shoppers. These factors are also causing in-market shoppers to self-select into the Used market – internal sMedia data shows that the audience for Used campaigns has increased steadily over the past 12 months, and we expect that to continue into 2026.
Success in Q1 will come from making sure your vehicles (both new and used) are priced ultra-competitively in the market; ensuring that your inventory mix includes lower-priced options that will attract more traffic, and making sure that your sales team is well-trained on how to turn leads that come in on Used Vehicles into New Sales.
People Want To Talk To… People
Over the last decade, it’s become crystal clear that the way customers are choosing to contact a dealership has changed. The “Internet Form Fill”, long the gold standard for leads, is disappearing rapidly as customers are choosing contact methods like Walk-ins and Phone Calls that bypass automated sales funnels. In a world where AI is proliferating fast, customer actions are clear: they want to talk to a real-life person.
Shift Digital’s latest report* confirms this, showing another 7% drop in internet form fills year over year, whereas calls and chats continue to increase.
As customers make it clear what their preference is, dealerships must make it easier for customers to call their store. Make sure a “Call us” button is your primary call to action on your vehicle description pages. Consider ditching an automated phone tree during business hours and instead having a person answer the incoming call. In a challenging market, dealers who find efficiencies, put themselves out there and focus on the customer experience are going to win.
Focusing on the Path Forward and Your Circle of Control
As these early 2026 trends suggest, the automotive market continues to evolve in ways that prioritize efficiency and genuine connection. While macro-factors like consumer pricing sensitivity are outside of a dealership’s direct influence, how we choose to show up in those digital spaces is entirely within our “circle of control.”
Success this season isn’t about fighting the current; it’s about leaning into the efficiencies we see in the data. Whether that means capitalizing on more affordable ad impressions or making it easier for a customer to connect with a human via a “Click-to-Call” button, these are the tangible moves that drive results. At sMedia, our goal is to be the partner that helps you identify these opportunities early, ensuring your marketing is not just a line item, but a strategic advantage that supports your store’s growth.
* single most important factor in all their purchases
*Shift Digital’s latest report
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- Your Q1 Reset
- Navigating The AI Rush
- Stop Wasting Ad Spend
- Paid Ads Now in AI Overviews – What Dealers Need to Know
- Increase Your Impact with AI-Powered Video
- Unlocking a Competitive Edge: Why Microsoft Ads are a Game-Changer for Dealerships
- Google vs. Meta AIA Ads: Where Dealers Should Spend Right Now
