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Roughly five percent of the population is in the market for a car at any given moment. A car dealership, for example, in the greater Atlanta metro area, which is home to over 5.5 million residents, has a shot at selling a vehicle and associated products and services to roughly 275,000 people.
Approximately a quarter million people are actively shopping for cars using search engines like Google and Bing, and are being influenced by interactive display ads while they consume online content, i.e. reading about the NCAA Tournament on ESPN.com or the unseasonably cool temperatures on Weather.com. With so many people in the market, all you need to do is throw a healthy amount of money into paid search and retargeting, and it’s all systems go, right?
Markets, however, aren’t always as transparent as they seem, and digital advertising is no different. For example, two dealers across the street from one another can compete with the same budgets for paid search and retargeting/display advertising with far different results.
Let’s review three important tips that can make or break your digital investment this spring:
Retargeting and display ads ensure that you can cost effectively raise awareness among that five percent of the population looking for a specific brand that your dealership offers and recapture lost opportunities when shoppers exit your digital showroom without starting a sales conversation.
Most digital marketing agencies rely on one, maybe two, advertising exchanges to traffic all of the ads shoppers see during their consideration phase. A single, large exchange may deliver display ads to individual websites like The New York Times, possibly reaching up to 90 percent of potential shoppers. But these ads are limited to a fraction of websites that shoppers visit regularly. Furthermore, the ads don’t often display on the most visible pages of a particular website. Agencies will buy leftover advertising space exclusively, so they can pump lots of your ads onto less desirable spaces. It’s a less expensive strategy, but also yields poor conversion of shoppers who end up visiting your site.
These ads are not displayed on trusted auto review sites like Car and Driver and J.D. Power – publications that produce the kind of advertising reach most critical to shoppers’ decision-making process.
Display ads are critical to raising awareness among new shoppers and holding the interest of your current prospects.
Consider two versions of a paid search ad selling the same thing.
Used Ford Fiesta | View Our Certified Ford Fiesta 12 Month/12K Mile Warranty.
2013 Ford Fiesta SE | Only 1 In Stock, Priced at $12,990 See Us Now Before It's Gone!
Notice the differences? Not only is the second version’s headline more specific (“2013 Ford Fiesta” vs. “Used Ford Fiesta”), but there’s also a direct link between the current inventory, featured price, and relevant ad copy. There’s powerful incentive for shoppers to click on the ad based on limited availability and transparent pricing.
Plus, there are additional callouts added based on the model represented, such as ‘Up to 25 MPG Highway’ and ‘4 Door Sedan’, and links to service, directions, and contact pages.
Dynamic ads communicate changing value statements to shoppers in real time. The proof is in the conversion rates for the two ad examples above:
Don’t spend more money chasing additional customers if your current lead management system is broken. Fix that first, and then move a larger number of ad dollars into digital.
Is $5,000 a “big” digital ad budget? What about $10,000? $50,000? The answer depends on your sales opportunities and inventory.
First, we need to determine your current share of the market when it comes to paid search ads on Google and Bing. This is referred to as impression share. For example, three out of 10 ads that reach people who have entered specific keywords translate to a 30 percent impression share.
During highly competitive selling months like spring and summer, your impression share may drop significantly as more dealers enter the marketplace and bid more aggressively.
The answer isn’t necessarily to pour every single ad dollar you have towards the search engines. You should at least, however, understand your current capacity to handle more leads, and what is available given your current impression share. Once you understand your share of the market, it’s easy to modify a budget accordingly.
To ensure a profitable spring selling seasons, let’s review these tips:
1. Increase your retargeting and display ads across a premium network of auto-specific research sites to access the most inventory and shoppers.
2. Employ dynamic paid search ads that announce compelling, real time value statements.
3. Determine your market share and understand your capacity for handling more leads.
Following these tips will net your dealership higher sales as we warm up throughout the spring.