Mastering Automotive Digital Marketing 2017 Edition

Index

Chapter 1

Dealer & General Manager Overview

You Are in The E-commerce Business

Before you disagree, consider that YOUR customers want you in the e-commerce business. This simple fact will drive everyone in our industry deeper and deeper into the Internet. As our industry evolves to become an e-commerce enterprise, new challenges and new opportunities will arise.

This book is your road map for success and your best defense against complacency. The content that I share will compel you to change because the opportunities will be clear.

How You Can Leverage This Book

The responsibilities associated with being a Dealer Principal or General Manager are considerable, but you need to make significant strategic moves.

•Someone in your dealership needs to understand the recommendations in this book. We are calling that person the Digital Marketing Manager.

•You must give this person your support, authority, and the resources needed to sell more cars.

•Hold he or she responsible.

Dealer Principals and General Managers must get more involved in the e-Commerce side of the business, but reading this entire book will be akin to walking on a bed of hot coals. I don’t expect you to read this entire book, but you do need to start digesting sections of its content.

Suggestion: Managers that are just getting started with learning about online marketing may want to start by reading my book "Swimming with Digital Sharks." This book is specifically designed for Dealer Principals and Dealership Managers and it not a deep, technical book this this one.

Identify someone in your dealership who can read this book and apply the recommendations I make to improve your online marketing strategy. You are in the e-commerce business so you need to revamp your management strategy and look at the metrics that e-commerce companies use to connect with online auto shoppers.

Each chapter of this book has specific recommendations that can improve your dealership’s operations. You should meet with whomever you assign to read this book to discuss which actions they will be taking based on the content contained in each chapter.

Create a form like what is shown on the following page and require your Digital Marketing Manager to complete the form for each chapter he/she completes. Review his/her top five recommendations and discuss the next steps that should be taken.

(Download a copy of this form here: http://bit.ly/​MADMBONUS.)

If a new vendor solution is recommended based on any chapter, ask your DMM to request a proposal from the vendor. Require your Digital Marketing Manager to complete a Marketing and Process Summary (MAPS) form for each recommended vendor that is being considered. Details on MAPS can be found in Chapter Two.

Collaboration Is Critical

The responsibilities associated with being a Dealer Principal or General Manager are considerable. I understand I am asking you to expand your knowledge in an area that you may not feel comfortable with today. You need to step out of your comfort zone and work with someone in your dealership to understand the recommendations in this book.

Don’t be overwhelmed! Remember that there are online training workshops that complement the content of this book designed for every role in your dealership, including yours! Visit www.pcgtraining.com for a list of workshops.

Think About Your Last Blood Test

In the United States, it is very common for an annual medical examination to include a series of blood tests. These tests are scheduled in advance of a visit with the doctor so that when you sit down with the doctor, he/she can review your results.

The human body is extremely complex, yet by examining different aspects of the human blood, a doctor can gain actionable insights into your health. Have you ever thought about the tremendous value that blood tests represent to doctors?

Before I explain how this applies to your dealership, let’s review some high-level data about your body:

•You possess 3,000,000,000,000 (three trillion) nerve cells all coordinated by the brain.

•You have 30,000,000,000 (thirty billion) working sections in your brain.

•You have 131,000,000 photoreceptors in your eyes.

•You have 24,000 hair-like cells in your inner ear which react to sound and convert it to nerve impulses.

•Your small intestine has a surface area of 970,000 square feet.

•Your heart beats 100,000 times and pumps 2,000 gallons of blood every day.

•Your liver manufactures more than 1,000 different enzymes, each controlling a different chemical reaction.

•You have 60,000 miles of blood vessels in your body.

•You breathe 438 cubic feet of air each day.

•There are 35,000,000 gland cells in your stomach to allow it to break down food without digesting itself.

•Your kidneys have 40 miles of tubing and clean 500 gallons of your blood every day.

•Every cell has 1,000,000,000,000 (one trillion) bits of data in it. (That is as much information as 10,000 encyclopedia-sized books.)

•Your body has 639 muscles that must work together.

•Our joints must move 25,000,000 times in our lifetime without wearing out.

•There are 30,000,000,000,000 (thirty trillion) cells in our body with 10,000 functions.

Obviously, these numbers are averages, but they indicate the incredible complexity of our bodies. As an owner or General Manager, you know that an automotive dealership does not have as many moving parts, but some days it can feel that way! Agreed?

When your doctor sends your blood out to the lab, they perform a series of tests depending on the feedback from your doctor. The tests require specific equipment to be used, exact procedures to be followed, temperature levels to be maintained, and finally an accurate accounting of the data. If the lab wanted to impress the doctor about their services, the reports could be 10-20 pages long.

Yet, the final blood test report that the doctor receives is normally 2-3 pages long. Only the important data is summarized. This simplified report allows the doctors to use their years of experience to inspect, diagnose, and recommend a course of action for their patients.

The key point in this story is that doctors demand reports that contain actionable data. The fluff is removed and they know exactly what to look at on the final report. They can circle a row of data and discuss a specific action plan to improve your health.

Creating Simplified Management Reports

Since doctors use a simplified blood test report to diagnosis their patients, Dealer Principals and General Managers must copy this practice from the medical community and create a simplified report to diagnosis their marketing strategy!

Imagine what would happen if you (Dealers and General Managers) had a three-page report that summarized the Key Performance Indicators (KPIs) for all your marketing investments each month. This is not only possible, but it is required for you to master your digital marketing strategy.

If you had this type of report, you could circle any lines that were out of normal range, just like a blood test. You could then discuss a recommended action plan to fix these abnormalities with your Digital Marketing Manager or your vendor partner.

How do Dealer Principals and General Managers review their digital marketing investments today? You may be different, but here are some current methodologies that I have witnessed:

•They log into 10-20 different software platforms to get their latest reports.

•They open 10-20 different emails each month and review or print PDF files.

•They have a stack of printed reports sitting on their desk that they briefly look at each month.

•They don’t look at the reports at all and have their Digital Marketing Manager handle the inspection process with the hope that he/she will escalate any issues to their attention.

These strategies, and any combination of them, are a big waste of time. This is because each vendor report is filled with fluff that their marketing departments developed to sell the value of their services. Without fail, there are only a few KPIs on each vendor report that you should inspect.

The irony is that no one is telling you what are the most important KPIs to inspect. So you feel obligated to scan each vendor report. When you finish, you have no clear plan of action to improve results. Correct?

In fact, most vendors know that you don’t read their reports carefully, so everyone is continuing a system that is broken.

Have you ever tried to read your own blood report? For me, I can read the numbers but I have no idea if those numbers are good or bad! This book will show your dealership how to structure your data management and how to create simplified vendor reports. I will define what are the proper ranges for your vendor KPIs and what to do when they are out of range.

Your time is valuable and I can guarantee you that once you simplify your monthly vendor reports, you will have more confidence to lead your online marketing strategy.

Dealers and General Managers should demand reports that have simplified actionable data. Remember that doctors do not tolerate fluff from their blood labs, and the automotive industry should move in that same direction.

Transforming Your Google AdWords Reports

Let me give you an example that you can identify with because most dealerships in the United States are using Google AdWords. The average monthly report from vendors providing Google AdWords services is 3-5 pages long. These reports have data that a Digital Marketing Manager needs to see, but not what a business manager needs to review. The average AdWords report looks like this:

No vendor will tell you that their typical AdWords report does not provide you with metrics that can be used to manage success. You can’t make any executive decisions based on these summary statistics, even if they were broken down at the campaign level.

The reason that this type of report is useless is because the metrics measure quantity and not the quality of traffic your paid campaigns generate. Less than 10% of any AdWords campaign will generate a hard conversion: lead form, phone call, chat session, or text message. That means 90% of your paid traffic does not identify themselves.

How can you inspect the quality of traffic from the 90%, which I will call stealth shoppers?

In this book, you will learn what are the actionable metrics that you should be reviewing each month. There are only 6-8 metrics that you should be reviewing each month for your Google AdWords campaigns, but sadly few vendors give you that data in their monthly reports.

If you would like to read more about the PCG Engagement Project, and the new metrics that have been created to allow you to inspect and manage ALL your paid online advertising, download this updated report: http://bit.ly/​PCGEngageSpecs.

In this free report, you will learn about the new marketing metrics that I have created to help you make better marketing decisions. Those new metrics are: Cost per Engagement (CPE), Engagement per Session (EPS), Zero Engagement per Page (ZEP), and Form Completion Rate (FCR).

A Better AdWords Report

What would I recommend for a Google AdWords monthly report? I would design a report that would align the business interests to get more consumers to look at your vehicles. If you were using Google AdWords to sell more used cars, I would want to see how many clicks are visiting used car Vehicle Detail Pages (VDP).

This report has actionable data because I can see how many sessions had ZERO engagement, using the ZEP metric. I can see the Cost per Engagement (CPE) for each campaign. If the CPE is too high, I can all the AdWords agency and tell them to improve the targeting.

For example, if you were trying to sell used cars using AdWords, and you saw that 70% of your used car campaign traffic had zero engagement points per session (ZEP 70%), it is likely that your advertising agency has a problem with BOT traffic or their targeting is broken.

If you are going to manage your digital marketing investments, every report should give you actionable data to improve the profitability of your dealership. You MUST confirm that your agency is tracking all lead forms, phone calls, chats, and text messages in Google Analytics. Most agencies that I have inspected do not take measuring conversion seriously.

The easiest way to confirm that your agency has everything setup properly is to ask them to show you in Google Analytics the goals or events that have been setup to track your conversion channels. If they can’t show you, it is likely that your agency is not competent to setup proper advertising reporting.

You have a role in this too! Your agency will need your help to require your phone tracking company and chat company to set events into Google Analytics when consumers convert.

The Next Step in Determining Marketing ROI

Prior to 2016, many of my talks to dealers encouraged them to focus on Vehicle Detail Page (VDP) views to inspect the engagement of the visitors to their website. While this was a first step in raising the bar for great accountability in advertising campaigns, it is time to discuss the next level of accountability.

Dealers and website providers must work to develop reports that show engagement on Search Results Pages (SRP) and Vehicle Detail Pages (VDP). Engagement is a much better measure of traffic quality.

Since the conversation started about driving more VDP views, it seems that some advertising agencies have begun to engineer their ad campaigns to land on a Vehicle Detail Page (VDP) regardless if that was the best place to take the consumer. In effect, the agencies heard from dealers we want more VDP views and the agencies complied.

You must be careful what you ask for. Sending consumers to VDPs is not always the FIRST place to take them when they are in their shopping process. So how can you decide if your advertising campaigns are sending consumers to the correct landing pages?

The simple answer is to measure engagement. Dealers need to measure how many actions a consumer takes when they visit a website page.

Tip: One quick way to measure if sending a consumer directly to a VDP is working for your dealership, is to inspect the ZEP percentages for each ad campaign. If you have ZEP over 50%, it is likely that you will need to test different landing pages.

In the example on the following page, you will notice that the VDP for this preowned vehicle has many call-to-action options. If each action was captured, counted, and weighted, then our industry could better measure the intent of the consumer and adjust landing page strategies.

Dealers are encouraged to work with their website providers to develop counters for engagement actions that appear on SRPs and VDPs. Using Google Analytics events and the Google Tag Manager, website providers can tell dealers how many click actions were taken on the dealership’s website pages.

PCG has already created Tag Manager scripts for all popular US website providers. Dealers who enroll in the PCG Engagement Project receive these scripts so that engagement tracking can be started immediately. You can learn more about the project by visiting this link: http://bit.ly/​PCG-Engagement.

How would this work? Let’s discuss the blind spot that dealers have today regarding their Google AdWords campaigns. Dealers can advertise online by bidding on search terms used in the Google search engine. These ads can take a consumer to an SRP and/or a VDP, but how do dealers know if that was the best choice of a landing page?

The answer is to look at cost per engagement metrics. One keyword could drive consumers to VDP and have very little engagement while another keyword could generate higher engagement on the VDP.

If a counter was set to measure how many actions consumers took on each page that would be a start. Then, dealers could test weighting specific click actions higher, like the schedule a test drive button. A test drive click could have twice the weight of clicks to view photos.

In this model, dealers can compare keywords and landing page combinations to maximize the cost per engagement and eliminate the blind spots created by how Google calculates bounce rate.

Creating Your Dealership’s Master Lab Report

Now imagine if you took all the Key Performance Indicators (KPIs) and put them together in one spreadsheet. Then you would have a lab report for all your marketing investments. It will take just minutes to inspect and then you can give the directions needed to improve the health of your dealership.

In this book, I will review the KPIs that should be included in your master marketing spreadsheet. You can also add KPIs that may be specific to your local marketing or your dealership group. The key point is that you must reduce the clutter and get to the facts.

Setting up the acceptable ranges will also be covered in this book. For example, what is the acceptable range for a Cost per Engagement (CPE) for used cars? What is the acceptable range for chat conversion on your website? A complete list of KPIs and acceptable ranges can be created with the assistance of this book.

You can also automate the collection of KPIs, using third-party executive dashboard tools like VistaDash.com. Each evening the software will pull data from your marketing partners to see if your custom list of KPIs are all within acceptable tolerances.

By automating the inspection of your KPIs you will never be caught off-guard. It’s like having a daily blood test report at your fingertips without the need to draw blood.

While there are many generic data dashboards on the market for business owners, PCG Companies has created the most robust, independent dashboard for the automotive community. The dashboard, first released in 2012 as ROI-BOT, is now called VistaDash.

In the example on the following page, each KPI has a green, yellow, or red light associated with each line item. Any KPIs that are red require immediate action.

The automated lab report in VistaDash is called the Dealer Scorecard. The report can be emailed to your team to discuss, or forwarded to any of your vendor partners as part of a monthly review.

(Dealer Scorecard Example from www.Vistadash.com)

Whether you decide to create a monthly spreadsheet by hand or automate the process, you need to create your summary lab report for all your marketing investments. Focus on the important metrics and eliminate the fluff. It will free up your time and facilitate a greater discussion with your Digital Marketing Manager and all your vendor partners.

Rethinking Your Marketing Budget

Once you make the commitment to work with your Digital Marketing Manager to create a simplified list of Key Performance Indicators (KPIs) for your marketing strategies, you will have a strong foundation to manage your marketing investments. However, some Dealers and General Managers are not completely confident that their current marketing budget is properly divided between offline and online opportunities.

At the risk of alienating some dealers, I have decided to include budget recommendations that can form the basis of a discussion with your marketing team. There is no perfect mix of marketing investments because there are too many variables with dealership sales strategies. Take my list of spending priorities and discuss each one based on your current or previous experiences.

Regional and geographical considerations also impact marketing strategies and budget allocations. For example, newspaper is still an effective marketing investment in some markets. In other areas of the country, too many newspaper choices can create a fragmented audience or make it too expensive to have a strong presence in print.

Whatever the situation is in your local market, I challenge you to look at your current marketing investments with a fresh perspective and have processes in place to hold these investments accountable for driving more shoppers for sales, service and parts to your website and into your dealership most efficiently. Before you eliminate any recommended investments, please read the corresponding chapters in this book.

Start with a Clean Slate

Your past experiences with certain marketing strategies may be tainted by unrealistic expectations, faulty reporting, and/or you may have been looking at the wrong KPIs. Some of you may have also been burned by a long-term marketing contract that you could not terminate or a service that you did not understand.

For example, let’s say that you hired an SEO company in the past because of a vendor’s promise of increasing organic traffic to your website. After some period, you canceled the investment because you did not see a clear ROI on your SEO investment.

Who is to blame? I think that there are responsibilities on both sides of any marketing contract. First, the vendor should have provided example reports which outline how their work will be reported to you. They should have discussed which KPIs would be used to determine success. They should have confirmed your agreement that the KPIs were indeed aligned with your marketing goals.

You should have demanded a more detailed explanation of what specific tasks will be completed to achieve the promised levels of organic traffic. You should have also asked for realistic timelines for progress to be measured.

If you and your marketing team invest the time to read this book, you will have greater knowledge of the critical KPIs that measure success for all online marketing investments. You will come to understand industry best practices, which will help you to select better vendor partners and reduce blunders.

Sample Marketing Budget

I created a spreadsheet for you to start a budgeting discussion with your Dealer Principal, General Manager, and/or your marketing team. The spreadsheet lists specific marketing investments along with an approximate monthly cost to a franchise dealer located in the United States.

You can download a copy of this spreadsheet by visiting: http://bit.ly/​PCGBudget2017.

If you don’t understand all the recommended budget items, you are not alone. This book covers all the recommended investments in detail, so ask your Digital Marketing Manager (DMM), who is responsible for having an in-depth and up-to-date knowledge, to help you understand them

Some dealers establish a marketing budget based on a cost per retail sale. In the example spreadsheet on the following page, I have set that number at $300 per car sold. Allocating $300 per car sold may be too high for some, or for others in a highly competitive market like Los Angeles, that number may be too low.

Whatever your target is for your dealership, the spreadsheet can automatically adjust the projected marketing budget based on your inputs. Just change the starting values in the spreadsheet and the budget will be recalculated.

The spreadsheet breaks out investments into three tiers. I consider Tier One to be non-negotiable; you should be using all the recommended strategies. Once you implement the strategies in Tier One, you should move to Tier Two. Once Tier Two is implemented, you can move to Tier Three.

Some marketing investments I classify as experimental. I am still testing to see if they can deliver a clear ROI for your dealership. I wanted to mention them because some dealers are showing success with new online strategies. Marketing investments that I consider to be experimental include: Twitter and Pandora digital radio advertising.

Tier One Budget Investments

Let’s discuss my budget recommendations starting with Tier One. As I previously mentioned, the line items in Tier One are what I classify as non-negotiable because they establish a strong foundation for other marketing investments. Without the right foundation in place, you will not be able to maximize the ROI of your marketing budget.

Responsive Dealership Website - Your website is the online projection of your dealership brand and marketing message. Your immediate priority must be to properly merchandise your new and used vehicles. To accomplish this, you will need to select a website platform that displays your inventory attractively on desktop, tablet, and mobile devices. I further discuss the importance of responsive and adaptive website technology in Chapter Three.

Vehicle Merchandising - Invest in professional photos of your vehicles. If space permits, shoot the photos in a clean staging area that is free from distractions and that has consistent lighting. You must create original photos for all new and used vehicles in stock. Do not use OEM stock photos. Your vehicle descriptions should be carefully written to engage and sell each vehicle. Do not repeat vehicle features that are already listed on the VDP. I review best practices for vehicle merchandising in Chapter Six.

Website Content Development – When you purchase a website for your dealership, it is often a basic shell. If your website platform is mandated by your OEM, then other dealers in the franchise network will have the same basic shell. To increase the organic traffic to your website and to serve online shoppers, you must budget for content creation. In Chapter Five I discuss different ways you can add content to your website, but in most cases you will need to hire a writer or agency to assist you with content creation. Don’t make the mistake of allowing your website content to become stale. Google is watching and will reward websites that add new content for auto shoppers.

Dynamic Call Tracking - You need to invest in dynamic phone tracking software! You may be using dynamic phone tracking on your AdWords campaigns, but I also want you to invest in phone tracking to document calls that come from any online referral source to your website. I want you to be able to see how many phone calls are generated from Facebook referrals, YouTube referrals, or online classified advertising websites. There are several companies that offer dynamic call tracking and they are listed in Chapter Three.

VDP Enhancement Tools - I have listed a line item for VDP Enhancement Tools which refers to any software plugins that give your SRPs and VDPs greater appeal to the online shopper. Companies offering compelling tools include PureCars.com, SpinCar.com, KBB.com, and MakeMyDeal.com. Dealers are encouraged to request a demo of these tools to see which tool(s) may be aligned with your online marketing strategy.

24/7 Managed Chat - Dealers in the United States are using chat on their website, but I am amazed at how many dealers think chat is not effective. Chat offers a segment of your website visitors an immediate way to communicate with your business. Personally, I would rather call than chat, but my clients’ chat engagement data confirms that chat is popular with online shoppers. Having chat on your dealership website is non-negotiable. Add it this month if you have been delaying the investment. There are several companies that offer automotive chat services and they are listed in Chapter Three.

Equity Mining – One of the best calls you can make to an existing customer is to advise them that you can upgrade them to a newer car before their lease ends. The call is even better when you can tell the customer that their payment will not increase. Equity mining campaigns extend the recurring revenue from your existing customers. Equity mining campaigns have a high gross profit because your customers are not actively shopping and comparing prices.

There are tools to run equity mining campaigns internally or they can be outsourced. If your dealership is not running equity mining campaigns, you are missing out on high gross deals. This marketing investment is placed in Tier One because it is non-negotiable for dealers in the United States.

Companies offering equity mining tools include www.autoalert.com, www.elead-crm.com, www.dealersocket.com, and www.drivedominion.com.

Lead Engagement Software – How many days does your sales department persistently follow up on an Internet lead? At some point, most sales professionals would rather work on a fresh lead before sending the 20th email to a consumer in their CRM workflow. Lead engagement software never gives up on your sales opportunities. It increases the ROI of all your marketing investments that generate form leads.

PCG Research published a whitepaper on Conversica.com, which is a leader in automotive lead engagement software. In addition to documenting the benefits of the software, the research pointed out the challenges that your dealership has with email deliverability. You may not be aware of this problem, which is why you should download a copy of the research at www.pcgresearch.com.

Online Video Production – Consumers love to watch videos online. Your dealership should be leveraging this medium to connect your brand message with in-market auto shoppers. Your dealership should be adding videos to your website, as well as using videos in your Google AdWords strategy. Videos can be leveraged in your CRM email communications, as well as in your Internet Reputation Management (IRM) strategy. I outline video marketing strategies that can increase online engagement in Chapters Five and Fifteen.

Call Monitoring – Make an investment to have your incoming calls monitored in near real-time. Regardless of how diligent you are with training your staff on proper phone etiquette, there will be times each day when phone calls are not handled properly. There are several services that will transcribe phone calls and alert your management team minutes later with a text or email, if a call was mishandled. (www.CallRevu.com and www.CarWars.com)

A few very positive events will happen when call monitoring systems are put into place. First, you will be able to save deals from going to your competitors. You will also be able to provide same day feedback to your staff when your staff varies from best practice phone scripts, which will help them get better. Lastly, you will be delivering a better customer experience, which will be reflected in higher CSI scores and online reviews.

Tier Two Budget Investments

Let’s now discuss my budget recommendations for Tier Two. The line items in Tier Two are what I classify as highly recommended, as they are working for a clear majority of dealers that I collaborate with on their marketing strategy.

Google SEM – Google AdWords is one of the most common ways in which dealers drive online auto shoppers to their website for an initial introduction or as a quick jump to their website. You will need to have a budget allocated to SEM campaigns but I want you to analyze those investments based on the recommendations in Chapters Eight and Nine. You will learn that there is a limit to how many in-market shoppers Google AdWords can generate in any given month, so do not feel that you should overspend the competition.

Google Retargeting and Display Ads –There is much research behind why you should combine display advertising with your SEM campaigns. Keeping your brand name and marketing message in front of local consumers is not a new concept. However, display advertising brings that strategy to the Internet. Display advertising campaigns need to be carefully analyzed depending on the strategy that you want to employ, so read Chapters Eight and Nine carefully.

In my experience, over 50% of display advertising campaigns are not delivering a great ROI. Most display campaigns need to be adjusted to deliver higher quality shoppers and a better ROI. In this book, I discuss how a simple audit can be conducted to inspect the activity of your display campaigns.

Facebook Advertising – Facebook and Instagram advertising has come a long way since this book was first published in 2014. Facebook is offering dealers a unique opportunity to reach the billions of daily users of their platform.

Facebook’s ability to target consumers with your ads, based on which brand of vehicle is in their driveway, is a distinct advantage over Google AdWords.

You should be testing Facebook advertising not only for its precise targeting and captive audience, but also because recent changes in Facebook’s organic reach has limited the number of consumers who will see your non-boosted Facebook posts. This topic is discussed in greater detail in Chapter Eleven.

Lead Nurturing (Incentives) – It should come as no surprise that consumers visiting e-commerce websites are presented with offers, coupons, promotions, and sales as part of their shopping experience. I encourage you to investigate ways in which you can bring incentives to your website to encourage more showroom activity.

There are several dealers who are using gift card incentives to reward consumers who come to the dealership for a test drive. www.DriveAutoHook.com has an attractive program for dealers that integrate incentives on websites, as well as in your lead handling process. It is time that you learn from other e-commerce websites and test incentive based marketing to sell more cars.

LotLinx –I have been very careful to provide dealers with several vendor choices for any recommended marketing investment. In the case of LotLinx, they are the only company offering a vehicle syndication solution that delivers measurable VDP activity on your dealership website. As you read through Chapter Thirteen, you will understand the importance of VDP activity and its relationship to vehicle sales velocity. I recommend that dealers investigate adding LotLinx to their advertising portfolio because it drives pre-qualified shoppers to your website at a very affordable cost. PCG is also a reseller of LotLinx.

CarGurus – While this platform is considered a third-party classified website, it has a unique value proposition that separates them from their peers. The difference is that CarGurus has a very strong SEO architecture that drives considerable organic traffic to dealership inventory listed on their website pages. Thus, dealers I have spoken with have stated that they are finding the platform to have a more tangible ROI for the price that they pay to list their vehicles online.

Third-party Classifieds – Your dealership needs to connect your e-commerce products (new and used vehicles) with in-market shoppers. Third-party classified websites like Cars.com, Autotrader.com, Edmunds.com, and KBB.com have invested millions of dollars a year to develop their websites into a destination Internet address for auto shoppers. Their cost per VDP view is often much less expensive than the cost per VDP that your marketing budget generates on your own website.

Before you judge the value of third-party classified websites, you should read Chapter Thirteen. Invest the time to understand how to evaluate the ROI of third-party classified websites more accurately and fairly because they are a strategic marketing partner whether you want to acknowledge it or not.

Targeted Direct Mail – Direct mail must be a part of your marketing budget in Tier One. How much you decide to spend per month is negotiable, but do not miss out on creating a customer lifecycle marketing campaign. You should also be testing direct mail conquest campaigns targeted for your local market. Offline marketing strategies are covered in Chapter Fourteen.

Tier Three Investments

Finally, let’s discuss my budget recommendations for Tier Three. The line items in Tier Three are what I classify as recommended, because they are working for dealers, but your budget may not be able to include these services on a regular basis. I would hope that you could afford these items, but on the pecking scale, they place third in priority.

SEO Strategies – Having a consistent budget line item for Search Engine Optimization (SEO) is hard to find with most dealers in the United States. It seems that SEO investments go hot and cold depending on the emotions of the Dealer Principal or General Manager.

I would strongly recommend a consistent budget each month for measurable SEO activities like content building and content syndication. In Chapters Five and Ten I review how you can make sure these investments are being properly executed for your dealership.

I love video marketing. What I love more is that Google likes to show well-optimized videos in Search Engine Results Pages (SERPs). You should have part of your budget allocated for video marketing optimization so that your brand message can connect with consumers as they use the Google search network.

Reputation Management/Monitoring – Most dealers have an informal process and policy regarding online consumer reviews. By placing this line item in Tier Two I am saying that this topic must be taken more seriously in your dealership. You must have resources allocated to inspect, develop, and promote your online reviews.

Without a budget associated with Internet Reputation Management (IRM), you will leave your dealership exposed. In Chapter Seven, I review why this is a highly recommended investment and worthy to be in your monthly marketing budget.

Email Marketing Campaigns – Email marketing is not dead yet, but few dealers make any real effort to create an effective email marketing campaign. I am not a fan of generic email newsletters that lack a customized customer message. I am a fan of targeted emails that can be easily read on desktops, tablets, and mobile devices. I encourage you to seek out a competent email marketing partner to keep your brand in front of your existing customers, as well as developing a conquest marketing strategy.

Please be careful when you choose an email marketing partner. PCG Research released a ground-breaking report on automotive conquest email campaigns being offered to dealers. If you have not taken the time to read the research report, take a minute to download the whitepaper at www.pcgresearch.com.

You should know that most email conquest campaigns that PCG inspected had very irregular traffic patterns. Our research calls into question the quality of traffic being sent to dealership websites from conquest email marketing investments.

Third-party Leads – If you are currently using third-party leads in your dealership, are you wondering why third-party leads are listed as a Tier Three marketing investment? For dealers who have strong Internet sales processes, third-party leads could easily be moved to Tier Two. However, without good processes, buying third-party leads may not beat the ROI of other investments listed in Tier Two.

Let me state that the ROI of every third-party lead source is dependent on your internal sales processes. Comparing the results of two different dealers using the same lead sources is practically impossible. I have witnessed leads converting at 5% at one dealership and 10% at another, and all from the same source. If you have strong lead handling processes in place, then any additional lead sources that help your dealership sell more cars should be tested.

Allocation for Offline Media

The first question that I am asked when dealers see this spreadsheet is: How did I decide on the Offline Allocation? In this spreadsheet, it is set at $100 per vehicle sold.

In this example model, at least 30% of the budget is dedicated to offline media. When you include direct mail, the total percentage for offline media can be up to 40%.

Before you think that I have lost my mind, I work with dealers that have 90+% of their marketing budget dedicated to online marketing, except for direct mail campaigns. These digital dealerships are leading their markets, but they are the exception rather than the rule.

There are still many offline marketing strategies that are working to help dealers sell vehicles. Your challenge is to work through these tiers, and make sure that you are leveraging all the strategies that can drive in-market shoppers to view in-stock vehicles on your website, at the lowest cost.

One of the more promising offline marketing innovations is coming from cable companies. Spectrum Reach, former Charter Media, is testing advertising models that will allow dealers to target consumers’ cable boxes by IP address and by specific demographic data.

Imagine being able to push advertising messages to local consumers that own the brand of vehicles that you sell. With data partnerships with companies like IHS Automotive, Spectrum Reach can combine vehicle registration data with consumer home addresses, to offer highly qualified viewers for specific products and services your dealership offers.

Big data marketing strategies are coming from local cable companies. These companies will be joining your team to create a consistent brand message to local auto shoppers using online and offline media channels.

Summary Thoughts on Budgeting

Take my budget outline and compare it to your existing budget. Discuss your comparison with your marketing team and vendor partners to see if you have any gaping holes in your strategy. Keep in mind that your website must be properly merchandised to convert visitors into customers. Don’t skimp on photos, videos, content, and phone tracking!

I would also like to mention that my budgeting outline is a starting point for discussions inside your dealership. There are other marketing investments in use by dealers that did not make my list because I wanted to create an affordable budgeting model. Feel free to add additional investments that are working at your dealership.

If you would like to get a copy of my latest budgeting spreadsheet, click on the following link: http://bit.ly/​PCGBudget2017.

I update the spreadsheet periodically to reflect new strategies and products that I am testing each month.

If you are not familiar with all the strategies that are recommended on the spreadsheet, don’t worry. You are not alone. You can build your comfort level with the online marketing strategies discussed in this book by enrolling in the PCG Learning Center. A full list of the online training workshops can be viewed by visiting www.pcgtraining.com.

General Manager Mentoring Program

It is my hope that this book will inspire all Dealers and General Managers to lead their organization in a digital age. While learning from a textbook can be effective, for many automotive managers a video training program would be more effective for how they like to learn.

With that in mind, I have created a special online program for General Managers that can fit in their daily work schedule. If you are a General Manager, or will be promoted to General Manager soon, and would like to make a commitment to expand your knowledge of online marketing so that you can lead your dealership team in a digital age, I encourage you to read on.

Each year I am fortunate enough to speak with hundreds of General Managers at local workshops and national conferences. The demands of running a dealership has made it challenging for General Managers to stay up-to-date with automotive online marketing strategies.

Yet, General Managers acknowledged that each year they are spending more of their marketing budget on digital marketing. So how can General Managers get the education they need to create stronger local online marketing strategies and INSPECT the effectiveness of their current marketing investments?

Attending one or two-day conferences has not developed the skills that GMs need to understand and measure their online marketing investments. Can you identify with the challenges that General Managers face to build the skills they need to hold their team and vendors accountable?

Online Marketing Leadership for General Managers

Here is the outline of the PCG General Manager Mentoring Program:

•General Managers will complete a short assessment to