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Jared Hamilton
From: Jared Hamilton
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Brian Pasch

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Google Changes Automotive Adwords Options

Google met with top automotive dealers and manufacturers at the 2011 NADA Convention in San Francisco this week to introduce their new lead generation model for search, which one insider called "Dealer Preference". This is a new strategy for their popular Google Adwords software.

The new paid automotive advertising model by Google would create special automotive ads which are designed to generate calls or leads, which will be sold to the highest bidder. This is a game changer in my mind but people at the meeting said that dealer response was very mild.

Take a look at this screen capture for the search phrase "mortgage loans" and look at the new Adwords section that says "Comparison Ad" that is highlighted in red.

 

Google Automotive Lead Gen


This model is new to the automotive industry but not new to other verticals like Mortgages. You can see from the screen shot above highlighted in red, Google has created a special new pink bar for ads that it creates for lead capture and places them ABOVE normal Adwords ads. Notice that ad has radio buttons and a call to action to "Compare Rates".

On a related note, you will also see one business using Google Boost and how much more attractive PPC ads will be getting if a car dealer has high review counts!

 

When you click on that link, this is what you will see:

Google Automotive Comparison Ads

The position of this page is sold to the highest bidder, I assume. Details on the Dealer Preference advertising is forthcoming in a second post. My first guess that this will be used for New Car advertising and that some OEM's might prefer this enhanced lead generation model. The jury is still out and I need to get more information on this product offering.

This is a game changer for the automotive advertising industry. If Google starts to become a middle-man in automotive price advertising and comparisons, a whole new strategy will need to be considered. It still will have to be seen if this increases clicks on paid ads.

 

Automotive Advertising Changes Again


This new features does a few things:

  1. It pushes other paid ads lower on the right sidebar.
  2. It pushes organic search results down so positions 1-3 become even more valuable
  3. Dealers that have been ignoring Adwords will need to get in the game and test things.

The idea that Google has in mind is that if a consumer types in "Used Honda Miami" it will display its OWN lead collection ad and show cars or sales based on participating dealers.

What is your reaction?

Do you have some additional information from NADA to share?

Tony Harris
Thanks Brian. Its nice to get the "good word" from NADA considering I'm not there in the flesh. What I glean from this is that the landscape will continue to shift and its crucial to shift with it. I think the most important thing you reference, however, is the constant; top 3 organic listings are invaluable. T
Tanesha White
Thanks Brian for the update. I definitely saw this coming, automotive is always behind other industries. This really drives the importance of SEO to dealers that haven't taken it seriously over the past DECADE! We must always keep in mind that Google is always looking out for the consumer even if it gets tougher on us. They want them to always have a great user experience and be able to find relevant information fast. Tanesha
Tanesha White
Thanks Brian for the update. I definitely saw this coming, automotive is always behind other industries. This really drives the importance of SEO to dealers that haven't taken it seriously over the past DECADE! We must always keep in mind that Google is always looking out for the consumer even if it gets tougher on us. They want them to always have a great user experience and be able to find relevant information fast. Tanesha
Larry Bruce
First, the automotive model will be a bit more complicated for Google than mortgage was. New car pricing is riddled with national, regional and dealership level incentives making the pricing process much more difficult than a straight forward loan rate. Then you take into account finance options and trades and you start to find there are a few more moving parts than in a home loan. Second is the issue of inventory, where are they going to get it? This process will not be any better than what is currently available to dealers and vendors now, no value there and they’ll have to pay for inventory(Google won’t like that either) Third the pricing model: The lead business is very labor intensive and has a lot of give and take when it comes to good vs. bad leads (Google won’t like that). Leads today are pretty much a commodity; I have seen nothing to suggest that Google leads will be any better so they will be in a price war with Dealix and AutoUSA right off the bat, and if you can’t provide more value, then the price is the only place you can go. Last conflict of interest: Now we are all competing with Google for the attention of the car shopper, I hope Google can make a lot of money on the leads model if we all stop spending money on adwords. Google will get into this space but it will hardly be a game changer. It might become one if they stick with it but that I believe isn't even a 50 / 50 shot right now.
Ed Brooks
Larry does a great job outlining some of the complexities specific to the retail automotive space. While he touches on national, regional and dealership level incentives, perhaps the bigger issue is that most customers want to buy (at least somewhat) locally. What Google is doing in the Mortgage space is selling national companies a national audience. How many dealers would want to spend a dime advertising their 2007 Honda Civic located in San Diego, CA to a buyer located in Bangor, ME?

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