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It was only under a decade ago your communication channels were made up of 3 channels, print, TV and radio. Today, we have access to literally hundreds of vendors, services and technologies, all different colours, shapes and sizes! How do you decide which to use? What way do you turn?
Not only do we live in a world where exponential technology is disrupting the marketing landscape but we also have to measure each channel, deciding the path to least resistance, of course, the best return on our hard-earned dollars. I truly believe that this is one of the biggest challenges for dealerships today!
Developing an attribution model will help you to understand where your customers are coming from and more importantly where the sales are coming from.
ATTRIBUTION MODEL CHALLENGES
The challenges of building a strong attribution model are again, the vast amount of channels we use to communicate with our customer. Each channel has some kind of analytic platform. Aggregating each platform to get the insights you are looking for is extremely time-consuming and redundant. Going through this process week after week, month after month can cause “ANALYSIS PARALYSIS”… also known as a waste of time. This is when you run in circles looking at data with no real insightful outcomes to better the strategy. So choosing which information/data to track and focus on is another important aspect of a solid attribution model!
SIMPLE TRACKING TO BEGIN YOUR ATTRIBUTION MODEL
Here is a simple form of an attribution model anyone can use without an expensive tracking system: (Nobody said it would be quick and easy)
1. Track the following religiously! (WEB SESSIONS, LEADS, APPOINTMENTS, SALES) many dealerships don’t track appointments…HUGE mistake. If you want the simplest way to see lift in sales… track appointments. You will be surprised what happens.
2. Once the dealership is tracking Web Sessions, Leads, Appointments and Sales you can begin tracking the conversion percentages. (Example: if you have 1000 web sessions and 10 leads, your website is converting at 1%. If you get 4 appointments from 10 leads your lead to appt. ratio is 40% if you sell 2 of those appointments you're converting at 50%, leads to sales)
3. Once you have done the math (like above) and figured out each PERCENTAGE, multiply the percentages together. (0.01 X 0.4 X 0.5) outcome = 0.002
4. Take an average gross profit from your dealership, front and back end gross combined. ($2000) Multiply by the percentage from your conversion funnel. 2000 X 0.002 = 0.04
WHAT DOES THIS MEAN?
Each web visit = Four Cents! Now you can work with the team to improve the conversion ratios in each aspect of the funnel. Knowing which part of the funnel needs work. You can do this same math with every communication channel you are currently using. This is time-consuming, however, can be helpful when deciding what communication/marketing channels are best for you!
Does your dealership have an attribution model? How do you decide what Vendors or Marketing services to use?