There is a lot of talk about segmenting your sources and there are countless articles about how to properly set up your Google Analytics to track where things are coming from using standardized UTM codes (in fact, we have our own videos on our resource page), but this may not actually be the best way to measure your digital marketing results.

Put down your pitchforks and let me explain.

The most important thing to remember is that each marketing source will affect other sources and - while separating sources is important for different reasons - you must realize that the results of the marketing campaign are due to the whole effort rather than its discrete parts.

Not splitting up digital sources when measuring results may seem counter to what everyone is saying, but let’s walk through a very common buyer’s journey to illustrate how ALL sources affect each other and produce a cumulative effect.

Consider this example:

Let’s assume that you’ve done your research and you want a new BMW X5.

Because you’ve been researching BMW X5s on research sites, some dealer advertising technologies will know that you’re interested in X5s so you get served a Facebook ad of a beautiful BMW X5 at “Metropolis BMW” and a 0.99% lease offer.  

You think: “Not bad, let’s see what else is out there,” and you fire up Google and search “BMW X5” and  get served SEM BMW X5 ads from “Metropolis BMW”, “City BMW” and “Westgate BMW.” Because you recognized “Metropolis BMW” you click on that dealer’s ad. It takes you to the New BMW X5’s search results page, where you find the one you like.

You read up on it, scroll through the pictures, but for whatever reason you don’t fill out any forms and you leave.

A few days later, you are reading about Lebron dominating on ESPN.com and Metropolis BMW retargets you with the X5 you’ve looked at. You think “That was a pretty good X5, I should really show the wife and see what she thinks.”

Later that evening, you want to show your wife the X5. You fire up your browser and type in “www.metrobmw.com” and navigate to the BMW you remembered. Your wife thinks it’s pretty good and you fill out a “Get ePrice” form to get the best price.

SUCCESS! Digital marketing conversion!

To recap, this was the buyer journey, the ads, and the associated digital marketing sources:

So, what would you attribute the conversion to?

Direct traffic? But there was a SEM ad click in there. What about display? There were no clicks - but it did prompt the buyer to chat with his wife. How about Facebook? It started the whole thought process.

Your Google Analytics would have reported Direct as the traffic source for this conversion. But, as you can clearly see, completely attributing it to Direct isn’t correct.

Ok smart guy, so then how would you measure your digital marketing?

Because each source interacts and affects other sources, the only trustworthy way is to measure “one level up” at the campaign or thematic level. For example, “one level-up” at your dealership could be the campaign you’re running: new cars, used cars, specials, fast sellers, slow sellers, etc.

This is because your new car campaign message will rarely cross over to your used car campaign messaging and vice versa. As a result, the people who resonate and react with one campaign typically won’t resonate with the other.

The measurement and subsequent comparison then becomes, which campaign or theme gave me the best ROI? Did promoting new cars on all channels result in better ROI than promoting used cars on all channels?

So next time you see yourself judging your marketing results by channels try to remember that digital marketing is all a big happy family and that digital marketing, as a whole, really is more than the sum of it’s parts.

Digital marketing in the automotive dealership industry is incredibly competitive. Dealers are constantly vying for the top position in all channels - SEO, SEM, listings, display. If it exists, they want to be at the top. And as a result, we get many requests for benchmarks and whether they are “better than the guy down the street.”

However, putting too much emphasis on external benchmarks may lead you down the wrong path as it focuses purely on how others are doing rather than how well (or poorly) you’re doing.

What dealers should be focusing on are internal benchmarks and comparisons such as how well you are doing compared to yesterday and what you need to do today to improve your results tomorrow.

External Benchmarks Don't Provide Any Actionable Insight

Forget about digital marketing for a minute and let’s compare benchmarks to something else. Suppose you own an NASCAR team. The lap times at Daytona range from 44.53 to 47.97 seconds, the average lap time is 45.51 and your car’s lap time is 45.30.

I’m not sure about you, but I wouldn’t be happy if my car had a lap time of 45.30. Even though I’m above average, I would want to improve on that. I would want to get my lap time to 45.00, then 44.53, and if possible 44.00. What’s more, it wouldn't matter if my car was the one bringing up the rear at 48.00 or in the pole position at 44.50, I still want to better my lap time.

As this example illustrates, external benchmarks don’t have any bearing on what you should do next.

This analogy can be applied when comparing results for your digital marketing efforts. Whether it’s Time on VDP, VDPs per Session, Bounce Rate or anything, it’s more important that you keep improving regardless of where you are on any external benchmark.

Internal Benchmarks Provide Much More Insight

Internal benchmarks provide much more value because they are a direct reflection of the actions you have taken. As a result, you can see where your decisions or activities have become better or worse.

Below are a few internal benchmarks that will help with your comparisons.

Benchmark 1: Before vs After

This is typically what people think about when they do internal benchmarking and it works well to measure the difference between a major strategy shift. Given the same time period determine if we are better now than we were before.

Example 1 - VDP / Session - Before vs After

In Example 1, the benchmark from Months 7-12 was 33% better than from Months 1-6. As a result, we know that the activities we are executing are producing positive results.

Benchmark 2: All vs One

“All vs One” benchmark comparisons are good for determining if a particular tactic is contributing to an increase or decrease in your average. This helps assess if a tactic is helping or hurting your metrics.

To do this, measure the metrics from a particular tactic and compare them to an aggregated benchmark of all tactics. The benchmark in this case is the “All” measurement and the comparison is against the “One” measurement.

Example 2 - VDP / Session - All vs One

In Example 2,  the internal average of all sources for VDP / Session is 0.84 and we can see that Technology1’s average is higher than the average for all sources.

What this means is that Technology1 is helping bring up overall metrics and is contributing to the success of that metric and should be viewed positively.

Benchmark 3: Month vs Month

“Month over Month” comparisons provide insights into two things:

1. What direction items are trending, and
2. If the results are an anomaly

Example 3 - VDP / Session - Month vs Month

In Example 3, we see a general increase in metrics for Months 1-3 and a dip in Month 4 for “Technology1.” However, results recover in Month 5 and Month 6. As a result, Month 4 looks to be an anomaly.

Additionally, when we compare it to the “All” line, we see that both sources dipped in that month. This indicates that the dips were universal and may be caused by an external market factor.

Focus on What’s Important: Continuously Improving

It’s easy to get caught up in external benchmarks. It’s nice to hear that you are doing better than the average or, alternatively, it’s frightening to hear how much further you need to go. But the one thing that both of these scenarios have in common is a shared goal for constant improvement.

So the next time you are given benchmark metrics, take them with a grain of salt and try turning your focus inward.