For the past 2 days I have been in debate on dealerrefresh about online marketing numbers and conversion. It appears that my comments on what a website should convert at have caused a stir in the dealer community, enough so that I was called out on it and asked to back off. It also appears a label I have placed on a main website is causing some people heartburn.

This post will hopefully clear up a few things:

1.       Why I believe that the benchmark for conversion in online marketing should be 30% minimum.

2.       What the definition of a “Random Access Website” is and why they are the way they are.

3.       Why I believe that you should NEVER…EVER send paid traffic back to your main website deep-link or otherwise.

So let’s jump right into conversion percentages and benchmarks.

First let me start out by defining conversion – A conversion is any form submission, phone call (tracked from your online properties), email or chat session where good re-contact information was captured that would allow the dealership to follow up on the customer. I have yet to have anyone dispute this as a proper definition. If anyone has something that I am missing please feel free to share with the rest of the class. Make no mistake each of these actions can be tracked with absolute accuracy, do not let anyone tell you otherwise.

So how did I come to this 30% benchmark? Ok it starts with my own store were we track everything. We found that we could use the visitors query string data to determine intent and direct visitors to the part of our website that closest matched that intent and when we did so our conversion rate rose 377% to as of this morning 26%. We also found that by tracking and changing certain things about our eBay motors ads we got a higher conversion rate to as of this morning 17%. We also found that using Facebook marketing in ways that were geared to customer interests not so much to customer in market probability we got higher click through and as of this morning a 47% conversion rate, ironically add all of that up and average it and as I write this post we are an average of exactly 30% (there are some decimals there but I am rounding up) and we are a small independent used car operation with none of the brand help dealers have today.

Which brings me to phase 2 of my justification for a 30% benchmark.  I have personally analyzed hundreds of dealership websites over the last 9 months and come to the same conclusion I hear from a lot of dealers and internet personnel I talk to in the store. Branded terms (your dealerships name) drives over 60% of the traffic that comes to my website. I have met very few that will argue this stat, the ones that do say it is too low. Ok so now let’s do some math:

Average dealership website gets 3000 unique visitors per month. 60% came from the stores branded terms (dealership name) that is 1800 visitors whose specific intent was to find your dealerships website.

1800 x 30% = 468 is it too much to ask that out of 1800 visitors 468 engage the store in some way? Let me ask it another way.

If your dealership got 1800 visitors last month and your sales staff could only get 468 of the people who came in entered into your CRM system would any of them be still employed at the dealership?

Any way you slice this up it doesn’t make sense to say 30% is unrealistic. I don't care who you are.

The definition of “Random Access Website”, apparently this adjective has offended a couple of people in the auto community as this is the second post I have been called out on this term, in this last post the offended person even when so far as to Google the term.

A main website has random people that wonder into it from organic links (one of the problems with web marketing and SEO by the way, but that is another post) you have no idea how or why they are there and when they get there they can wonder randomly throughout your site, hence the term “Random Access” a site that is randomly accessed from anywhere by anyone and anyone can randomly go anywhere in it and yes this is basically all main websites. A main website is basically the Encyclopedia Britannica of your online presence you have everything including the kitchen sink in it. From inventory to job postings to press releases to Facebook and twitter links, is it any wonder that visitors become distracted, lost and just basically give up when it come to this maze of information?  I discussed this in depth in my post “Get outside your random access website” from Feb this year go there for more on the pitfalls of conversion in a main website.

Finally the above is a great lead into why you should NEVER…EVER send paid traffic back to your random access main website…EVER!

You should understand by now that your main website is so full of distraction that anyone coming there with a specific purpose will have to work hard to complete that purpose. People specifically looking for your dealership will work harder to get the information they want than others, not by much but harder none the less. I think we can all agree on that and that is why you see higher conversion form branded terms (your dealerships name). When you pay for a click you have to get something out of it sending that to a place where you know they are not interested in all the distractions around them, that doesn’t match with what they were searching for in the first place and make this work to find it, is a recipe for conversion disaster.  

Aside from the distraction factor of a deep-link here are some other reasons to use off site pages and microsites.

1.       Tracking and accountability – it is much…much easier  to track and hold marketing channels, ad groups and keywords accountable for results when you have separate landing experiences.

2.       Split testing – you cannot get to high conversion rates without testing and it is impossible to test in a dealership random access website today even a deep-link.

3.       Matching the message tightly with the ad and the landing. If you think you are doing this with a dynamic deeplink landing page that changes the picture and the header your sorely mistaken you will have to get much more relevant than that.

4.        Getting searched right out of an opportunity – time and time again I see deep-links go to inventory then the customer searches to find out you have 1 or 2 that’s not choice and you missed the opportunity before you ever got a chance to win the customer.

5.       With each off site page or Microsite you create another back-link for you main random access website helping its SEO value.

PPC is and will continue to get more competitive, it is imperative that you create a culture of continuous improvement in conversion for any traffic you are paying for and lets be real you're paying for all of it. Branded terms (your dealership name) comes from your traditional media advertising, organic links comes from SEO (that aint free! All dealerships are paying for this in some way or another), listing sites are costing you subscription & listing fees and obviously you are paying for every click in PPC. You need to track all of these and hold them accountable for conversion because conversion is indicative of what walks in the door…period. Off site landing pages and microsites help you track all of this very accurately and helps get more of what you are paying for.

I hope this clears it up for those who were unclear. For those that think I should “back off” sorry that just wouldn’t be me, can’t do it and for anyone this somewhat helps I’m glad. If I can clarify anything here or you need help contact me I will do all I can.

Cell – 281.455.3811

Email – lburce@micrositesbyu.com

 

 

 

 

So you know your online marketing needs to be better and now you just need to find someone to do it. The following questions are ones you need to ask to ensure that you maximize your investment:

 

1. What increase in conversion rates should I expect?

Can an online marketing company guarantee specific results? I have yet to meet a credible company that is able to guarantee specific results. The truth is, every project comes with its own unique situation. However, a good online marketing company should invest time with you up-front to set target goals for any planned improvement and optimization work. Keep in mind though those pre-set targets can be both achieved and missed. The point is to focus on defining success parameters for the project from the very first day.

2. What time frame should I expect the project to be set up by?

Online Marketing is an ongoing process. There is always room for improvements. Some companies will provide the work within a month and disappear after the initial implementation. Your best bet is to find companies that offer support services in the months following initial implementation and will continue to work with you dealership to improve.

3. What happens if our conversion rates do not increase?

Some elements of your online marketing may already be performing at their full potential (if there is such a thing). There are numerous reasons as to why you do not see the desired results. When asking the chosen company this question, you need to pay close attention and really listen to how they answer you. A company just starting out in the online marketing space or that is not very good at what they do, will focus on the fact that you will see improvements. A credible company or practitioner will be focus on a transparent process, keep you updated on how the project is going, and be willing to provide additional work within reasonable parameters if the project goals are not met.

4. What are some of the risks involved in a online marketing project?

A red flag should immediately go up if someone tells you that there are no risks involved with any marketing project. Again, keep in mind that some elements on your online marketing might be performing at their maximum conversion rates. There is always a slight chance of lowering conversion rates, although it is a small risk with companies that know what they are doing. A recent client of ours came to us after a change in online marketing companies caused his lead rate to drop by 40%! Online marketing optimization will most likely require changes in site layout and copy, traffic direction and landing. There are times where such changes will affect results.

5. Do you follow a specific methodology to online marketing and conversion optimization?

If you are buying traffic, clicks or eyeballs conversion is the only thing that matters. Following any of the conversion optimization blogs should help you improve conversions. However, reaching double digits in conversion rates requires a unique and repeatable methodology. I have to add here that testing is not a methodology. It’s a component of a methodology, but cannot and should not constitute a whole methodology. Finally, the methodology should be easily adaptable to each specific project and dealership.

6. Do you work with any partners?

Online marketing work requires collaboration with design firms, SEO houses and other marketing companies. A good online marketing company will have some of these tasks in house. Some will work with partners to complete the work. Check their partners’ work and make sure that you are happy with it. Also ask what would happen if the partner defaults or does not deliver on time or within the acceptable standards of quality.

7. What are some of your failures?

If you work long enough in online marketing optimization, you will have few failures along the way. There are many reasons why a project could fail. An honest company will be open and transparent about the mistakes and lessons they have learned. A company that never had a single failure is too good to be true.

8. Do you work with my website company?

Your website is getting a significant amount of traffic, most of that traffic is looking for you dealership specifically so it is important that your online marketing company have creative ways to work with your website to increase conversion. Most website vendors in the automotive space have limits on the type of work that can be done on the site. It is almost impossible to find an online marketing company that works with all the different web companies in our industry, but the more experienced companies should have worked with some of the major website vendors out there. What’s more important than working with a particular website vendor is understanding what kind of limitations working with a templatized framework can bring.

9. What is expected from my personnel?

Having responsibilities well defined prior to the start of the engagement will make everyone’s life a lot easier. If the online marketing company is expecting you to complete any specific tasks, you need to have the time, money and resources ready to do so. Is your technical staff going to be required to complete any specific tasks? Should your internet group or management be prepared to participate in specific discussions? Answering these questions and preparing your team to support the online marketing company will impact the overall success of the engagement.

 

10. What conversion optimization platform do you use?

Always test, test, test! There is a variety of testing software available out there. Is the online marketing company going to use Google website optimizer or are they going to use proprietary tools set? Using Google website optimizer works in many of the cases but is difficult to implement takes longer to achieve results and you have no control over the testing process. Other company’s use 3^rd party software that they have little control over the process and will be limited in their ability to optimize for the automotive industry and there are too many who use nothing at all and if they are just buying you some traffic that’s the company you need to run from.

11. What will I learn from you?

Are you expecting to learn anything from the online marketing company? Will they engage in knowledge transfer, or is the online marketing company solely focused on doing the work for you. There are times where clients hope to learn from online marketing companies while these companies are only focused and interested in keeping them as a paying client.

12. What kind of support will we receive?

Online marketing is never complete. It will not be sufficient for you to hire a company that will charge a monthly fee then no further interaction, or you have to continuously contact them. You need to find someone who will stand behind you and provide additional support if you need it and continuously bring new ideas and opportunities to your attention.

13. What is the cost?

Some sales people run away from answering this question. They want to tell you about all the benefits you will get and the value they can bring first. In all honesty, I am a fan of being up-front of what clients should expect to pay. In the end Online Marketing is just about the numbers if you're as good as you think you are then the price can be justified by the results.  

14. Will you accept to be paid on achieved performance?

This might be the toughest question for a online marketing company to answer. Most online marketing companies are really consulting firms. Traditionally with any consulting practice, you pay for the time and effort spent by the company regardless to the results achieved. That is the reason, you -the client- need to make sure you are hiring the right company. However, there are few of us online marketing companies out there that operate on performance based models. These are the companies that are confident in their methodology and have a sustainable repeatable process and the companies you are most likely to have success with.

Okay, so I focused on online marketing companies in this post but the same questions would work for many of the online marketing disciplines.

Any other questions you recommend adding or removing from the list?

Digital Dealer was again a great venue this year. For those that wanted my slide deck and for those that couldn't make here is my presentation.

 

After reviewing 35 hours of people searching for car online on video we came to some shocking revelations that dispell a lot of myths we have been told over the years about how, where and why people shop online for a car.

 

Happy to answer any question about this slide deck.

 

Enjoy!

You shouldn’t spend money on advertising to new people if your current visitors aren’t converting, period. Ask yourself this question: Would you spend $100,000.00 more on advertising knowing you only have one salesperson who’s closing ratio is less than 10%?

If your answer is what I think it is then why are you spending any money on “SEO” knowing that your name is what is driving 70% + of your traffic, any money on Page One Defense when the leak is so small or one more red cent on PPC to drive traffic to your Random Access website? (That’s the salesperson with a 2% to 7% closing ratio)
 

Let me repeat that: "You shouldn’t spend money on advertising to new people if your current visitors aren’t converting over 15%."

Let it sink in.
 

In a recent post Seth Godin wrote:
“The mistake we often make: thinking that the problem is that there’s not enough people starting the process, not enough people being exposed to your offer. In fact, it’s almost always a problem with how efficient the funnel is…”

If you want more business, more leads, more sales, then get more people to convert, that’s the key.
Fix your conversion funnel first. Then, you have an efficient machine and if you want to crank up the traffic you can do so.
 

This just makes sense none of us would load up our advertising if our sales force wasn’t closing at a efficient rate and we didn’t have a team in place to handle the traffic. Right now you don’t have a team to convert the traffic if it’s not doing so at least 15% and really should be more. So dealers please quit buying into these traffic building schemes that turn into nothing more that turn into nothing more that more low quality traffic few more leads if any and nowhere near the sales to justify the cost.

I will be giving 2 sessions at Digital Dealer 9 in Las Vegas where we will be discussing conversion in depth and real world suggestions you can go back to your dealership with to start converting higher right away.
 

Wednesday October 13th Extreme Webpage Makeover Room #219 the Jamaica Room
In this session I will take websites and landing pages from the audience and give suggestions to go back and implement to start converting higher and engaging customer more. This is always a fun session but don’t come and offer up your page if you are easily offended.

Thursday October 14th Conversion Marketing Room #305 the Trinidad Room
In this session will discuss 7 deadly sins of search, email and display marketing that are killing your conversion. Many of these have been promoted as fact and best practice in our industry, we will be debunking those myths with actual user footage from a large case study by MicrositesByU.com in conjunction with UserTesting.com.
 

I look forward to seeing many of your there, it will be fun and educational as always.
 

Its 9 pm and I get this tweet from Matt Watson of VIN Solutions.

“Saving Chevrolet Means Sending ‘Chevy’ to Dump http://www.nytimes.com/2010/06/10/automobiles/10chevy.html?src=mv “

When I clicked the link and started reading the article, I found myself saying “WHAT!” There are no words to describe the level of ridiculous here. GM doesn’t have a brand recognition problem. GM has a business focus and a customer understanding problem.

I can’t believe that someone spent money at GM for some Einstein to come up with this ridiculous plan to stop using the term “Chevy”.

GM focus on building on good products, focus on connecting with customers and with your dealer body quit all this non-sense that your brand is broken, it’s NOT!

What is broken at GM is it’s trust with the dealer body. Their lack of new and quality product and their complete disconnect from the consumer. Fix those things GM and leave Chevy the hell alone.
 

That’s my opinion what say you?
 

I have been thinking these needed updateing for a while. This is my version, would like feedback on changes or additions or Bruce ur full of crap.

A lot of requests after my session at Digital Dealer 8. Here are 101 ideas to increase convesions and get away from 3rd party leads. http://bit.ly/aXVeOV

Hope they help,

Larry Bruce (@pcmguy)

At South by South West (SXSW) I attended Chris Brogan’s and Julian Smith’s session “I Don't Trust You One Stinking Bit” a really long title I thought but it did sum up the session. As usual I walked away my head swimming with ideas and making connections between trust, social media, customer experience and content.

As I thought through these ideas an old sales training model from the early 90’s came to mind and suddenly the role of social media in the car business, hell in any business became as clear as a bell to me.

While running my dealerships in the early 90’s one of my favorite sales training modules involved two triangles, some of you may have seen this example in a training session in your career. It goes like this:

 

This came to me from an old Clint McGee training tape where Clint talked about getting the customer to “spend YOUR time”. In training I would train salespeople to spend time with the customer introducing and selling him/her self, the dealership, doing the walk around, introduction to the service drive and the what I called the dealership community wall (a wall of pictures of good customers, testimonials, community sponsorships ect. all framed in a hall and wall at the back of the showroom)

As you can see from the picture above if you could get the customer to “spend YOUR time” then the closing rate and negotiation was short and the gross profit was higher. In those days it was determined this took place over a 3 day period.

In contrast if you weren’t able to get the customer to “spend YOUR time” then the closing rates were low and the negotiation stage would take far longer and the gross profit, much lower leaving the customer’s far less satisfied.

As I continued to think about this it hit me…

The “TIME” Clint wanted us to get wasn’t OUR time at all it was the customer’s time and we were working to establish trust in that small amount of allotted customer time, (the 3 days).

We only had those 3 days because we didn’t have all of the communication methods we have today and the customer didn’t have the plethora of in home shopping tools they have today

.
Now this model has been turned on its head and yet we still continue to do what we always do when we don't understand something, we throw money at the problem. We create loyalty programs that give discounts to good customers (why?), we create referral programs for people to get money if they refer people to our dealership / business and we have even started to try to take these models to social medial.

 

There this practice is the equivalent of a fart in church, if the customer trusts you then they like you and if they like and trust you then they will be loyal and they will refer their friends to your dealership or business, especially through social media. You don't have to pay them for it in fact they will be insulted if you try.

 

“Trust cannot be bought…it is its own currency and the two don't mix”

 

So what does the new sales model look like?

It’s an hourglass of Trust and Time. “Time like trust is its own currency, you can’t get it back and no matter how much money you have you can’t buy more of it”.

 

 

Now the CUSTOMER’S time spent is over 90 days and is a series of interactions with online research sites, your online marketing experiences, social media and your website.
As with the model above the more the customers engagement with your online properties the higher the closing rate the shorter and closing time will be and the higher your gross profit will be on the car or item you are selling.

This process now takes place over a 90 day period with little to no interaction with personnel in your dealership or business.

 

To win here you will need a combination of online properties that give the customer what they want (the information):

 

Do you have the car / product I am looking for?

 

Can I find it easily and can I find any additional information I want about it quickly and easily?

 

How much is it going to cost me? You will answer this question. While it is not the primary driver of the customer’s decision to buy from your dealership / business, it does get you a seat at the table.

 

If you are not competitive then you won’t even be considered.

 

This is why I have such a hard time with the pundits that still want to drive everything to a phone call or an appointment, bottom line is the customer will only call if you have a seat at the table thinking they are going to call or submit to “Get a Quote” is ridiculous. I know what you're saying they are doing it now, yes some are doing it now but they are becoming more and more the minority… really fast.

Once you do have your seat at the table then it becomes a combination of social media, engagement with the dealership personnel and TRUST.

 

These two will combine to give the customer the confidence that they are making the right decision. This is still the 2nd largest purchase the customer is going to make in their lifetime and it hasn’t changed, they still need to feel good about it.

The big differentiator here is how much time can you save me in your dealership. In stark contrast to the earlier model we are creating more trust now by minimizing the customers time in the dealership, being more transparent and giving them more control.

 

Customers have less time now than they ever have and speeding it in your store is the last thing they want to do with it. Offer home delivery, get as much done electronically as you can by doing so you are helping the customer make the decision to buy from you.

Ironically by them spending less time in your store you are showing the proper respect for the customer and their time and you gain higher loyalty by doing so. Don't just apply this to sales either do it in service too.

In short by being transparent and getting the customer the information they want quickly and easily, you get your seat at the customers decision table.

 

By engaging them on their terms allowing them to see the human side of your dealership and confirm their decision with other through social media you get less friction and when you do talk with the customer the conversation is not as much about the price as it is confirming their decision to buy from your dealership / business and working out the details of delivery of your product or service.

Now here is the hard part, this can’t be outsourced you and your personnel have to do it. Someone else can’t show your human side only you can do that. This can’t be accomplished with Stock Photo’s or 2 or 3 of the car, I need to see the real car I am buying from every angel.
In the end customers buy from people not dealerships and the buy a cars not a stock photo (even the new cars).

 

So it takes some effort on your part, to train differently, market to customers online instead of advertising at them, merchandising your cars properly and the convenience of you service department right, connecting with customers instead of up-ing them and being transparent, authentic with your information and genuinely trying to help.

 

Put the same amount of focus and effort on the things above that you now put into negotiation tactics and closing skills and you and your dealership / business will be far better off for it.

Like it or not the business has changed and I believe for the better.

Larry Bruce (@pcmguy)
www.pcmguy.com

15 years ago I told Ron Craft (the dealer I got my start in the car business with in 1984) “Customers aren’t shopping for a car they are shopping for a salesperson to buy a car from”. That was the way I approached car sales when I got into it after having been in the shop for a few years. I didn’t know it then but I was using social media. Each day I would I would take brochures, donuts and coffee to local hair salons, boutique stores, doctor’s offices ect. talk with the employees, customers and patients about just anything… and cars too, I got to know a lot of people and got a lot of referrals. Before I knew it I was selling 20+ cars per month and in 1988 I made over $80K selling cars in Baytown TX. For a single 20 yr old making $80K and yr runnin around in a free Camero, well those who know me know can certainly imagine the trouble I was able to get into, that’s another post (maybe). On each sale I got to the point that I would pretend to take the deal to the desk. Just leave my office hang out in the back for a while then return with a number. It was great fun and I think the reason I have stayed in the car business as long as I have is that it was and still is fun. This morning while working out and listening to Seth Godin as I often do, all the pieces started to fall into place from my early days selling cars to now and the use of social media in the car business. I Tweeted this morning “Customers will no longer pay for salespeople who are merely a cog in a machine #thedeathofthedesk in automotive” People are shopping for a salesperson…an experience, social media starts that experience with the salesperson early and can greatly enhance the customer wanting to buy from that person and your store. You dealers that are blocking Facebook, Twitter and keeping your salespeople from blogging you are killing yourself and stopping many customers from connecting with the experience, DON'T. Secondly, we all know that the back and forth to the desk process…customers hate it. They want their salesperson to be empowered, so let them be. Bottom Line – the desk was put in place to control gross… here is a wakeup call dealers, the market controls gross now you don't. Abundance of information has removed that responsibility from you, you don't have to like that fact but you do have to live with it. For the record I am with you I don't like it either, some of my best retail memories are of working the desk. Pricing is a function of the market now, your job is now price positioning and differentiating your buying experience. Social media and how you interact with customer pre and post sale has a great deal to do with that experience. Make no mistake about it like it or not you are seeing the last days of the desk, and because I love it so much and want to remember it in its prime I am willing to put a bullet in its head now and put it out of its misery, you should too. That’s my opinion…what say you? Larry Bruce (@pcmguy) www.pcmguy.com

While in San Diego at Online Marketing Summit 2010 I heard a simple yet revealing fact. The “Thank You” email you send the customer after they submit a lead or for an appointment with your dealership will have the highest open rate of anything you send that customer. This shouldn’t come as a revelation to anyone, and it didn’t to me until they said “Make the most of it”. I started visualizing all the thank you emails I have designed, written and received in my head and thought “My god, what a waste of a high value contact and a great opportunity for further engagement”. Conversion Rate Optimization today is all about engagement, the more engaged the customer the higher the possibility for conversion. For you dealership conversion in this case means the sale. The more you can get the customer to engage with your online property the higher your chances of getting that appointment and closing the sale. Engagement leads to trust and trust lead to the sale, when done properly. With that said here are 6 things you can do with a “Thank you” email that will encourage further engagement. 1. Suggest other like vehicles in your inventory. Customers like choice give it to them. Link them to those vehicles in your inventory don't be static. Good to suggest cars to look at or new models for service appointment “thank you” too 2. Join our Facebook Fan Page, Twitter List or Online Community and receive special offers and notifications 3. Link to your blog 4. Link to your YouTube How To video channel 5. SMS Short Code to join our SMS notifications – this is an opt-in mechanism and you should include a value add coupon. 6. White Paper “How to buy a car”, “What to look for when buying a used car” or “What does regular maintenance to my car mean to my pocket book?” Let’s hear you ideas for “Thank You” further engagement. Larry Bruce  (@pcmguy) www.pcmguy.com