How does a dealer split up the marketing budget? I think dealers need to examine their budget through a new set of eyes. First and foremost – your website is an extension of your brick and mortar, it is your online store. This sounds like a broken record but it’s true and if you look at it this way, you acquire a great benefit of insight that you didn’t have before. Your website is not a “marketing source”, it’s an end to a means – the shopper had to get to your website somehow and that is where the real value is, that’s the highest weighting source for your marketing dollars. Dealers also need to start labeling their line items differently for digital, it needs to be broken up into marketing and technology. If you are adding a spend that is purely technology driven and is on your website to enhance a feature or try to capture a lead, that should not be in the internet marketing budget, but it should represent a new line item for internet technology. That technology is not bringing people to your website, it’s enhancing the experience or it is a new function. Technology should be compared to having nice furniture in your waiting area or supplying your dealership with paper and electricity. This is going to give you a clearer view of ROI. Unlike having a nice plush couch in your showroom, technologies can have a direct ROI or value. It gives you a balance of funding new internet marketing initiatives or putting more money into technology – once you attack this and make the clear distinction, it literally is a game changer.
Now, how do you maximize the spend? You must first collect feedback from your customers, otherwise you are guessing. Again, somehow or someway everything has to be tied to a sale or influence the thinking of the local market, otherwise it’s worthless. You cannot equate traffic (analytics) to a sale or any other metric except a lead. If you base your marketing decisions off leads, you are alienating 80-85% of the shoppers out there that want to remain anonymous until they show up to the dealership. All things have to show their value; it is a culture shift that has to happen in automotive at some point or the marketing spend will remain cloudy. Things would be much easier if automotive was completely e-commerce, but it’s far from that – it’s a people business. Tying a customer to a marketing source is the number 1 process that dealers use to get some idea of ROI – but that is nowhere near enough but at the least, it shows some sort of value – that’s why it’s popular. There needs to be a determination and methodology to get more information, more knowledge of places that impacted the customer as they were shopping, insight on what the customer is doing and knowing the evolving trends of the customers’ needs and expectations. Marketing spend should be centered around accountability and value, do not get caught up in the fight to be sourced. There is a great amount of your inventory that is going to sell, no matter what.
Marketing Meeting example: “our website traffic grew 3.8% and that equated to 16 more leads which yielded 2 more sales”. “ATC sold x amount of cars and so on”. Poof, that’s it. Where do you go from there? How accurate are those traffic numbers, is it real traffic? Leads can be competitor and vendors shopping your process, especially if you are a highly successful dealership in the area. The metric that is the holy grail for your website is returning visitors, that’s it. That is the number 1 metric to drive success and build correlations around. What does traffic mean if it doesn’t result in sales? How do you know it results in sales? You need to know and find out. It’s not easy, but neither is chess or any game of competition. Your baseline metric should center around people who come back to your website.
Dealers need to hold themselves accountable also and probably to a greater extent than you do a vendor. Are you doing everything in your power to make every marketing initiative successful? Are you testing your creative, do customers have recall of your messages? Are you merchandising past the customers’ expectations and would you select your dealership, if an unbiased viewpoint is attainable? Some dealers use consultants, be careful because there are prominent opportunist out there using this new method of influencer marketing – it just leads you down paths where the consultant has a new relationship with a vendor and they can make your numbers say anything. The highest value I see in dealerships concerning consultants are the ones who focus on process, many great ones out there that touch all points of the dealership. When you are making a decision to rid yourself of a marketing initiative, you must exhaust all avenues in trying to correlate some value. Dig deep and try to prove at all costs that you need to keep that vendor. If you still come up empty you need to move on. Keep a look out for high duplicity percentages with direct sale initiatives.