When Wikimotive was in its infancy, there were still many dealers who “didn’t believe” in digital marketing. Today there is certainly widespread understanding and adoption of a “digital first” approach to most dealer’s advertising. But, often, I see dealers simply spending money as opposed to leveraging digital to win. 

 

There continues to be a pennywise and pound foolish approach to much of the advertising spend common among the dealer community. Every business has to make intelligent and cost efficient decisions about where they spend their ad dollars. However, much of the approach continues to be based on negotiating the cheapest service as opposed to analyzing the services that provide results vs those that do not (or do so at too high a cost).

 

Marketing isn’t magic. Its all about attention. Cost for that attention is the key to increasing profitability. Take search, for example. More than ever, dealers seem to understand the importance of search. And yet, more and more I see dealers spending more ad dollars in the most expensive places to capture that attention, instead of doubling down in the cost efficient areas.

 

Here is a real world example. Last 30 days (2017) compared to the same 30 days in 2016.

 

Dealer A received: 

 

-37,093 sessions in 2017 vs 35,328 in 2016  (+5%)

-27,341 from organic in 2017 vs 16,893 in 2016  (+62%)

-6,129 from Paid Search 2017 vs 7,558 in 2016  (-19%)

-72% of total leads from Organic Search 2017 vs 55% in 2016

-20% of total leads from Paid Search 2017 vs 35% in 2016

-61% of total phone calls from Organic Search 2017 (No DNI tracking 2016)

-19% of total phone calls from Paid Search 2017 (No DNI tracking 2016)

 

Organic spend: $9,720.00 in 2017 vs $12,415.50 in 2016

Paid spend: $40,880.43 in 2017 vs $42,929.44 in 2016

 

 

 

Dealer B received:

 

-62,249 sessions in 2017 vs 55,776 in 2016  (+12%) (note about 30,000 sessions in 2016 came from email marketing click fraud over a 6 day period - see Brian Pasch article on this subject)

-54,084 from organic in 2017 vs 8,485 in 2016  (+537%)

-0 from paid search in 2017 vs 2,018 in 2016

-63% of total leads from Organic Search 2017 vs 86% in 2016  

-0% of total leads from Paid Search 2017 vs 2% in 2016

-93% of total phone calls from Organic Search 2017 vs 73% in 2016

-0% of total phone calls from Paid Search 2017 vs 11% in 2016

 

Organic spend: $15,300 in 2017 vs $7,195.50 in 2016 

Paid spend: $0 in 2017 vs $12,451 in 2016

 

 

 

Dealer B took a very drastic action based on their own data. To some extent this is contrary to what we would normally recommend. Paid search certainly still has a place in your digital marketing strategy. But when is the last time a decision maker in your store actually sat through and 60-90 minute meeting with your SEM provider? What metrics are you demanding from your SEM provider? I sit through hundreds of these meetings with our clients. Are they breaking down conversion metrics by campaigns? Are they highlighting ad quality? How many leads or phone calls did your dynamic new or dynamic used campaigns produce last month? At what cost? How does that contrast with names and locations campaigns? What is the basis for the recommendations of your SEM provider?... What Google recommends?... Or is it driven by your data? At present I’ve observed that 65% of SEM campaigns in adwords show below average performance. Google actually provides that information. Have you asked your SEM provider why they allow such a high percentage of your campaigns to under perform?

 

Quite often the focus is on “industry standard” percentages and what Google recommends. How many vendors are you in the habit of mailing blank checks to every month?

 

I used the search example because I have extensive data that supports this example as being the rule (not the exception), but the same process can (and should) be applied to all marketing spend. Are you looking at AutoTrader, cars.com and Car Gurus the same way? What about 3rd party lead providers? How about email campaigns, direct mail and TV? Is someone annotating your TV spots, email campaigns, and mail drops in your Google Analytics? If not, someone should. You should see a direct result in your website traffic anytime a direct action campaign runs. Are your monthly meetings with vendors simply focused on what happened last month? Do your monthly meetings include all marketing vendors on a single conference to ensure strategy?... Or is each vendor off doing their own thing without collaborative communication? 

 

TV still shows very high value in metro markets and for high volume dealers. This is particularly true when combined with a strong search presence. Targeting direct mail/email shows very promising when done in conjunction with social media campaigns. The approach here is designed to substantially lower cost per sale and increase profitability. If I were being paid on variable net, this might be where I begin looking for my 2018 marketing strategy.