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Mark Hoffman

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Vendor Accountability & Transparency

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As 2016 approaches, it’s a great time to think about ways to reenforce accountability and transparency into relationships with your digital marketing vendors. Accountability and transparency are cornerstones of solid business practices, so even if you have the utmost trust and confidence in your vendors, you should still ensure that the relationship is as transparent as possible.

Here are a few ideas for getting better accountability from each of your digital marketing vendors:

Third Party Classified Sites - Third party classified sites are great lead generators for most dealerships. But one-size does not fit-all. There can be significant differences in the how effective these sites are depending on the dealer’s size, geographical location and inventory that the dealer stocks. It’s important that dealers have a reliable method for measuring the effectiveness of these sites.

Most of these sites will generate reports that show you SRP/VDP conversions, number of VDP views, etc. But these numbers are based on traffic on their site, so you don’t have any way of auditing that information. Just recently, AutoTrader has been sued over claims that they have been inflating these numbers to keep dealer’s business. Regardless of the merits of that lawsuit, it’s simply good business to have a way of measuring a vendor’s effectiveness that doesn’t rely on the vendor’s own reports. Trust. But verify.

 There are several key performance indicators (KPI) that you can independently verify. Firstly, your CRM should be able to tell you how many ADF leads were generated on the third party site. Secondly, you should be able to track the number of inbound phone calls that came from the site using call tracking numbers.

But you should also be looking at the website traffic that the third party site drove to your dealership’s website. Were they driving shoppers to your website that spent time looking at VDPs? How much time? By looking at all of these metrics, you can get a much better idea of how that classified site is performing for you

As you gather this data over time, you also form a performance baseline that allows you to make changes and measure the result. When the classified rep suggest that you change your subscription plan or purchase additional advertising from them, you can see if those changes make any impact on those KPIs we discussed above. 

SEM - First and foremost, you absolutely must have access to the Google Adwords account that is being used to manage your ads. (Or the equivalent for Bing and Yahoo if you are using those.) It still surprises me how many dealers that I see who are using SEM vendors that do not give the dealer access to their Adwords account. That SEM vendor might have great looking reports, but you must be able to verify their numbers by looking at Adwords and see for yourself how things are performing. 

Obviously the goal with SEM is to get the user to click or call. But we can dig a little more and get a much better view of how our SEM vendor is performing. A great metric to use for paid advertising is cost per VDP view. While it’s certainly true that some visitors will click on your ads and call or walk in without ever viewing a VDP, the majority of your visitors are likely going to browse your inventory first. So by using cost per VDP view along with cost per click and impressions, you can get a much better idea of how effective your SEM campaigns are.

Within each campaign that you run, take a look at each of the keywords that were purchased. Do these keywords make sense for your dealership? Is your SEM vendor spending a lot of money on competitive and expensive keywords that generate very few, but very expensive, VDP views? 

SEO - The SEO industry has matured quite a bit in recent years. Google has made significant investments in educating people in SEO fundamentals and many companies are incorporating SEO activities under their core marketing operations. Unfortunately, there are still plenty of shysters peddling their SEO “skills” like the snake oil salesmen of yesteryear.  

Holding a SEO vendor accountable for improving your organic traffic is relatively straightforward. A quick glance at Google Analytics will show how well they are performing. But don’t stop there; look a little deeper. Are those organic visitors engaging with your site? Are they searching for vehicles and looking at VDPs? I’ve seen SEO vendors brag about how they boosted a dealer’s organic traffic, but what they weren’t telling the dealer was that nearly all of that traffic was bouncing right off the first page they landed on. 

Website - It should go without saying, but you should be able to integrate your own Google Analytics account with your website. This typically isn’t an issue in the franchise dealer space, but on occasion I will still run into an independent dealer using a small website vendor that has made it impossible or very difficult for the dealer to use Google Analytics. Being able to run Google Analytics on your website should be non-negotiable.

If your website vendor provides reporting then make certain that their data is based on Google Analytics. I once worked with a dealer whose website vendor’s reports differed dramatically from what I was seeing in Google Analytics. When I asked them about the difference, they responded “Oh, we have our own analytics system. It’s better than Google’s”.  Right. I’ll assure you that no matter who your website vendor is, they do not have a website analytics system better than Google Analytics. And even if they did; I don’t trust your website vendor’s analytics and you probably shouldn’t either. But I have far more confidence in Google.

Even if your vendor is using data from Google Analytics for their reporting, it’s important for you to understand how they are using that data. For example, when showing the number of VDP views some vendors will report on the number of unique visitors that have viewed a VDP, while other vendors will show unique page views. There are merits to either approach, but it’s important to know which method is being used if you need to compare data.

Conquest Email Advertising - Conquest email campaigns have proven to be an effective way of capturing in-market shoppers. But dealers should still be looking at a few things to make sure that their vendor is performing. Using Google Analytics, you should be able to look at the geographical locations of visitors that came to your site as a result of the email campaign. Are those visitors in your local area? Unless you are specifically targeting visitors outside of your area, those email visitors should be visitors in your local market. There have been some well publicized incidents of companies faking opens and clicks to drive up the campaign open and click through rates, but of course, this traffic does nothing for the dealer. 

Once again, go back to the VDP. What are these email campaign visitors doing on your site? What percentage are looking at VDPs? Watch these number over time and see how your email vendor is measuring up.

In closing, a fantastic way of bringing accountability with your vendors is to first establish what key performance indicators you want to measure for each vendor. The things that I’ve mentioned above is a great place to start. Then, work with each of your vendors to create a realistic goals for each of these KPIs. A good vendor who is delivering results for your dealership should be more than happy to be held accountable in this way. If you have vendors that try to avoid this level of scrutiny then you should probably re-evaluate your relationship with that vendor.

What other metrics are you using to measure your vendor’s performance? 

If you are struggling with ways to hold your vendors accountable, drop me a line. I’d be happy to help! 

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