Notifications & Messages

Jared Hamilton
From: Jared Hamilton
Hey - It’s time to join the thousands of other dealer professionals on DrivingSales. Create an account so you can get full access to the articles, discussions and people that are shaping the future of the automotive industry.
×
David Metter

David Metter President

Exclusive Blog Posts

Rock’s Rants: No Respect

Rock’s Rants: No Respect

It’s no secret there’s a big service technician shortage, but do you know why? It’s not because young people aren’t interested in b…

3 Pillars to Build Your Facebook Ads: Variety, Audience, Inventory

3 Pillars to Build Your Facebook Ads: Variety, Audience, Inventory

Each month, most American consumers aren’t in the market to purchase a vehicle. When they do enter the market, their journey is dominated by a va…

Manager vs. Mentor

Manager vs. Mentor

    We sat down with Clint Pulver at DSES 2019 to ask him the difference between a manager and a mentor. There is always a mentor w…

Are We the Cause for Removed Managers?

Are We the Cause for Removed Managers?

One of the keynote speakers for DSES 19, Clint Pulver spoke in detail about the types of managers we encounter. One of those managers is the “re…

Customer Lifetime Value

Customer Lifetime Value

  We sat down with Jon Rossman at DSES to see what he thinks about the challenges facing automotive today. Companies need to be looking to …

Is Your Paid Search Paying Off?

It’s time for a reality check. I’d like to begin with pointing out the fact that more often than we realize, the correct solution to a problem is both obvious and simple. We live in a common sense world, but I think people forget that sometimes. From a young age, we’re programed to be “critical thinkers” and to look at a situation from all vantage points. Our encoded mental paradigms tell us we should analyze, overanalyze, and overcomplicate every possible variable that may contribute to a desired outcome. On the contrary, according to Ockham’s Razor, a scientific theory dating back to the 14th century, “the simplest solution is usually the correct one.” Spending my entire career in the auto industry, with much of it in a dealership, we skip most of this (thankfully) but there should be a happy medium. It’s where common sense meets analyzed data. 

Paid search, or pay-per-click, while it may appear to be an affordable form of advertising, there is a significant breakdown in the attribution no matter how transparent and detailed the reporting. Plain and simple, paid search is complicated. As one of the first automotive marketers to use paid search over 10 years ago, I have “complicated” scars. Yes, you can see the amount of clicks your campaign received. You can see the impressions. You can see the engagements. But can you see, validate, and know that a paid click led directly to a showroom visit without any other factors involved? Absolutely not. People looking for information doesn’t in any way translate to a sale. So, how do you measure the true ROI?

Think about how much you spend driving people to your website each month. Thousands upon thousands of dollars are devoted to driving potential customers to your site in hopes of converting a click to a sale. As of today, the vast majority of customers cannot and will not purchase a car on your website. Therefore, dealers depend on leads to attempt to convert web traffic into showroom traffic.

The stats speak for themselves. There is no arguing that well under 5% of website visitors will complete the standard dealership lead form. Specifically, WardsAutoDealerRefresh, and other industry leaders report 3-7% of automotive shoppers actually submit leads. CDK’s Digital Business Intelligence study shows only 1% of auto shoppers submit email leads from dealer websites.

It’s time we stop chasing imaginary attribution lines. If something isn’t working 95%-99% of the time, we need to do something about it. We need to direct our attention towards something we can quantify without a shadow of a doubt that led to a sale. We need to change the game – or more specifically, change the average lead form.

Let me provide you with a real life example. Just a few weeks ago, in February, 2016 (with only five days left in the month), a leading OEM came to my team asking what we could do to help push them to a stronger close. Typically, OEMs will rush to spend more money on search or display to increase traffic and then hope and pray that web traffic will convert to leads and showroom visits before the month ends. Unfortunately, that’s tough to do in five days. Its tough to do in 10 days, but manufacturers and dealers chase this same avenue month after month. But this particular OEM knew they had sufficient site traffic. What they needed was to see it convert in the showroom. AutoHook’s incentives generated more than 1,800 showroom visits in just five days and these customers were directly attributed to nearly 800 sales in the same time period - something I would challenge any digital effort to perform and validate.

In the Bounce Exchange’s latest Guide to PPC they acknowledge the tremendous waste potential of paid search. “Whether you’re a do-it-yourself small business or an agency managing hundreds of thousands of PPC dollars, you are leaving money on the table right now. Guaranteed.” Even worse, you could unknowingly be creating more opportunities for your competitors or just tossing money straight to Google. Their advice? “Move your budget into something that works.” More importantly, make sure that you have better and bigger nets to catch the fish. 

Let’s be clear. I am not saying don’t do paid search. It can be a great tool for driving traffic to your website, however it’s not ideal for converting actual sales or showroom visits. The reality is, paid search is not simple, and you can’t draw a straight line from your search campaign to a vehicle sold. A smart PPC provider, and more importantly a smart marketer, knows the difference between “researcher” and “buyer” search terms and online actions. Which do your campaigns target? What about your inventory? Are your search efforts boosting aging units or wasting ad dollars on high demand vehicles that will sell on their own?

Buyer search terms are specific and measurable. Buyers know what they want down to the year, make, model, and color. Most will not contact you before coming in for a test drive, UNLESS your website provides an experience that gives them something in return for submitting their personal information. Yes, I’m referring to offering incentives just for coming in for a test drive. It’s so simple. Give something to get something. If you are willing to pay for a click, why wouldn’t you be willing to pay for a showroom visit? Heck, they probably would have clicked anyway.

At the end of the day, you can empty your pockets in attempt to drive the world to your website. But the real question is, does your website convert once they arrive?

Carl Maeda

Does your website convert once they arrive?  That's an interesting question when it comes to paid search.

Most paid search vendors don't do a whole lot to maximize the chances of converting the user into a lead and sale.  They simply dump the user onto the website.  The bad ones will dump them on the homepage regardless of what ad the user clicked on.  The better ones will dump them onto the inventory pages.

They do this because once the user clicks on the ad, the paid search vendor gets paid.  They view the user as the the website provider's problem now.  If they don't convert, its' not their fault, right?

The proper way is to drive paid search traffic is to have very specific landing pages that match the ad.  Think of the ad as a promise to the prospect.  The landing page has to deliver on that promise.

Think about an ad for a $99/month lease offer.  Once you click on it, what should you see? 

a. The Homepage

b. Inventory matching the qualified cars

c. Details on the $99/month lease offer, along with maybe some matching inventory

What would maximize your chances of turning that prospect into a lead?

Matt Childers

Thanks David for your insight.  The Autohook campaign was very interesting with Subaru last month.  

I agree with what you are saying, but my one question for you is.... What are 3 specific things that you look at to evaluate your SEM spend?  It is easy to say that it is not effective, but how does a dealer know that it is effective?   I would argue that some dealers are super effective with SEM and don't know that they should actually increase their spend once they look at some KPI.  Your thoughts?

 Unlock all of the community & features  Join Now