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I recently told a group of dealers that I’d rather walk through hell when it’s raining gasoline than hear more about BIG DATA. I would guess many dealers feel exactly the same, but why?
My BIG DATA weariness comes from the often blurry explanation of what it is and the lack of formula or filter offered to dealers to help them understand the importance of data (BIG or little). I believe dealers need the “little data” that is extracted from BIG DATA to make smart business decisions. Where exactly does decision making “little data” come from?
First, consider that our online activity for work and entertainment purposes create what some call digital exhaust. This digital exhaust is the valuable data that companies like Amazon and Zappos use within their predictive technology marketing platforms. Digital exhaust comes from:
When a consumer clicks on the PPC or Display ad you’re running on the Google network… digital exhaust. When that consumer ends up on your website and looks at your inventory, chats with you, calls the dealership or fills out a form seeking more information they are creating digital exhaust and this data can help dealers better understand and segment their audience. The “little data” for decision making is the deeper dealership specific information that helps the dealer leverage the right media, deliver the right message/content and personalize the experience.
DrivingSales is honored to be invited to automotive industry events on a regular basis. Our schedules don’t allow us to attend as many events as we’d like to, but a couple weeks ago I was able to make it to an event sponsored by Cobalt at the GooglePlex in Mountain View, CA where market insights were shared by Cobalt, Google, Edmunds and Polk. The primary focus at this event was helping dealers better understand data to enable better decision making relative to digital marketing. The event was the best I’ve seen when it comes to sharing knowledge relative to data and helping dealers discover “little data.”
Remember the movie Finding Nemo? Can you imagine trying to find one specific fish in the entire ocean? Dealers facing the ocean of BIG DATA need a filter in order to discover the ”little data” that drives better decision making. Companies like Cobalt and Google are using BIG DATA to gain insight that challenges conventional thinking. They realize that dealers first need a filter, or frame for viewing data. One of the sessions I attended at the Google/Cobalt event instructed dealers to focus on data that makes sense to them and provided this filter:
Actionable Data – What will the data tell you about your business? Your customers? Your competitors?
Timely Data – Learning from data is about seeing and understanding trends. A single data point or a massive amount of BIG DATA is useless, the insight is knowing which way it moved and why. Even better… is knowing which way it’s going to move.
Manageable Data – Is your data easy to access? Is the amount of your data overwhelming? Focus on quality over quantity.
Have you heard of upstream and downstream metrics? CTR (click-through-rate) is a great example of an upstream metric or data point. CTR is a common metric dealers have examined for several years to determine if their paid search and display campaigns were worth the investment. CTR at the make level (Chevrolet, Volkswagen, Toyota, etc…) is BIG DATA. The downstream metrics beyond the click are where the decision making, “little data” is found. Inventory searches, vehicle detail page views (VDP’s), form submissions, hours and directions lookups are all extremely valuable downstream metrics with proven correlation to sales. Cobalt delivered an impressive presentation on “The Illusion of Metrics” at the recent Google event I attended. The session covered upstream and downstream data in great detail and they shared valuable research on the sales predictability of popular Key Performance Indicators (KPI’s).
CTR, visits and even inventory searches register low relative to predicting a sale. In contrast, VDP’s, hours and directions lookups along with form submission register high. Keep in mind the volume and relativity of each metric is different and should not be given equal weight. The combination of activity is where dealers find the most valuable insight and ability to predict sales.
For example, Inventory Search + VDP + Hours and Directions = Higher likelihood to be a buyer.
Visits and CTR alone don’t predict sales, but combined with downstream engagement actions your “little data” delivers big insight regarding sales predictability.
BIG DATA is overwhelming, so it’s crucial for dealers to identify Actionable, Meaningful, Timely, Manageable and Decision Relevant data. This provides a much-needed filter and when combined with the value of downstream metrics, dealers are able to make data based decisions that lead to more cars, parts and service sold.
So... may you find the inspiration to dig through the BIG DATA all the way down to where your “little data” is guiding you towards decisions that help you drive more sales.