Digital Marketing: Can Dealers Do Better Than Sales Leads?
Starting at the age of seven, when I worked for my father’s wholesale produce company, he frequently counseled me by saying that the key to a successful business was to be able to see where the market is going…Then, get there first.
With that said, here is my question for the automotive marketing professionals reading this magazine:
“Are internet leads as good as it gets for dealers using the web to market their vehicles and services online?”
Here are a few of the current tactics making up the various digital marketing strategies being used to drive traffic and convert visitors into internet leads and phone calls for dealers:
- Welcome to my website animations
- Life-style car videos
- Walking and talking virtual assistants
- Build-a-car configuration applications
- Virtual Test Drives (VTD)
- Third party lead sources
- Instant Click-To-Call (CTC)
- Online live chat sessions 24/7
- Photos of every square inch of the vehicle
- 360 degree tours
- Value your trade
- Get pre-approved for credit in seconds
- Site Performance Optimization (SPO)
- Search Engine Optimization (SEO)
- Search Engine Marketing (SEM)
- Stealth sites
- SEM landing pages
- Deep links
- URL redirects
- Spanish, French, Korean, Portuguese, Arabic etc. sites
- Pay-Per-Click or Cost-Per-Click (CPC) campaigns
- Cost-Per-Thousand (CPM) bid site targeting
- Banner ads
Basically, anything that attracts a consumer to your dealership’s website, micro site, landing page, or deep link and gets them to identify themselves or contact the dealership qualifies as a lead generating technique. Important stuff, but what about actually letting a car buyer…buy a car?
Back at the dealership, we talk about customer communications and sales operating efficiencies then arm ourselves to the teeth with all manner of technology, people and processes to handle these expressions of interest, which we call leads and phone calls…Examples include:
- Business Development Centers (BDC’s)
- Customer Relationship Management (CRM) tools
- CRM administrators using DMS/CRM/Lead Manager software
- Internet sales specialists
- Internet sales managers
- Call scripts
- Email templates
- Automated email scheduling
- Results based activity triggers
- New lead autoresponders
- RFID devices implanted in the buttocks of be-backs
- Anti-skating devices that electrocute cheating sales staff
- Business process outsourcing and so on…
There is absolutely nothing wrong with any of this, (as long as the RFID is sterilized first) but if I see one more Professor Gadget designed auto retail “Solution” that doesn’t actually make it easier to sell or buy a car, I think that a grand mal seizure may be imminent. Car companies and the dealerships they supply exist to design, build, distribute, market, sell, and service vehicles. The disconnect I see is that for the last 20+ years, we have used the internet as if it were some type of loudspeaker or megaphone to amplify each dealership’s various voices in a one way series of outbound information blasts.
We have limited our use of this amazing two-way channel to something along the lines of: “Here we are! Drive to our showroom right now…Or, call this phone number right now…Or, if you must, you can fill out this form and your reward will be an obnoxious, pushy and poorly trained car salesman will call you…Maybe right away, maybe tomorrow, next week, or maybe never. C’mon, go ahead and fill out this form and don’t forget to click on the submit button!” (great subtle psycho strategy with that favorite dealer website action item labeled “submit”)
J. D. Power and Associates reports that for the past seven years the number of online car buyers who are able to resist the above value proposition has been consistently around 80 percent. This conveys a profound message from car shoppers telling us what they think about automotive marketers’ 15 year obsession with “leads, leads, leads are the most wonderful fruit, the more you eat, the more you…”
Frequently, I come across ridiculous claims designed to convince consumers that they can have all the power, usually communicated by setting expectations for “Prices so low we cannot publish them.” To me that is a violation of consumer trust. Car dealers all buy their cars from the same place, so what is really being said? For some customers, what they hear is; “We are happy to make less profit.” or “We’ll gouge it out of the poor saps walking in through the showroom.” or “We’ll get it out of you some other way! (The $999 Desert Protection Package is required). The fact is dealers are required to generate a profit in order to stay in business. Cars and trucks must be sold and adequate gross profit margins must be generated.
Shown below are some statements I came across this past week that provide some insight into where I believe digital marketing in automotive retail is going:
Over the past five years we have seen several systems designed, built and piloted for the purpose of empowering car dealers with transactional capable web sites. For example, cars get sold directly from the “Deal Builder” function within “My Quotes” which includes credit, tiered interest rates, trade-in values, tax, title, fees, accessories, extended service contracts, protection plans, disclosures and accurate monthly payments. Dealerships get the selling opportunity regardless as to which step in the process that each consumer feels comfortable completing. Each customer’s “My Account” generates a customer relationship that transcends what most of us would call a highly qualified and genuine lead.
Personally, I like leads. Good, high quality ones. Leads from online car shoppers that feel they’ve been treated fairly, have engaged with a more fulfilling automotive shopping website, and who then respond to communications from the dealership. However, I am profoundly aware that “leads” are not the end-all, be-all complete automotive digital marketing strategy for the era of web enabled customer-to-business engagement. Internet leads will never be the silver bullet. I should know, having consistently generated over 5,000 leads per month in a single-point Chevy store. Sure, our team sold a lot of cars, but the leads were the symptom, not the cause.
I still like the blend of traditional media with digital messaging that I call “integrated marketing”. How does this marketing message sound:
“Attention Car Buyers: Would you like to be able to shop for a new or pre-owned vehicle from the comfort of your own home or office and be able to get the actual, rock bottom, best prices? And, be able to choose from multiple loan and lease terms that have been approved by major lenders before you go to a dealership? At ABC Motors you can create your secure online account and complete your entire vehicle purchase transaction online… All that you have to do is select from whether you want the vehicle delivered, or will pick it up at the dealership!”
Seems like an unfair competitive advantage, but, how will it play in Peoria? How about for those segments of the car buying public that are most dissatisfied with the most common car buying experience: Women, Gen X, Gen Y, Echo Boomers. How about busy working professionals?
Here’s a quote from F&I Magazine:
“I thought I’d put it to the ultimate test…what did my wife think? She’s pretty crafty you know. She selected the Camry and breezed through the rest of the process. She got a kick out of how the avatar’s eyes followed the mouse and how it changed facial expressions. Now my wife has purchased a vehicle before, but it sounded like this was the first time she completely grasped the itemized breakdown of the deal.”
How would you like to read the above on one of your Customer Satisfaction surveys? Would it bring a smile to your face to be secure in your future knowing that you not only had a customer who felt that way, but was happy to pay a fair price for a great hassle-free online car buying experience?
Shopping cart ecommerce has become a major force to be reckoned with in every other industry. In the early days of ecommerce, “disintermediaries” (e.g. Amazon) entered the market. As shopping cart ecommerce markets mature it is brick and mortar retailers adding a click and mortar strategy that carry the day. Is automotive ready for such a trend? Or is automotive retail absolutely and forever unique? What about test drives? Thos pesky trade in appraisals? These issues were dealt with long ago by eDealers like Courtesy Chevrolet in Phoenix, Anderson Honda in Palo Alto and Jay Wolfe Toyota in Kansas City.
Does anyone think that the current internet lead model is as good as it gets? Why? I’ve been involved with automotive digital marketing since my charter membership in CompuServe’s first public Internet Service Provider (ISP) offering in 1985. That’s over 25 years of generating, working and tracking internet leads! I know we can improve on what we have today.
Whether I am correct about transactional dealer websites being the next major trend in automotive remains to be seen. Personally, I feel pretty good about it. Ten years ago I was right about how to implement the most effective CRM tactical implementation for sustained ROI. Today, the most successful dealerships in America have Customer Relationship Centers (CRC) or BDC’s of some type, but, I could be wrong. There will certainly be plenty of naysayers who will come up with a never ending stream of reasons why it won’t work. It is always easier to make sure a sales process fails than to ensure it works. That’s why people in the dealership will remain the critical component of success with this or any other marketing plan. Regardless of anyone’s opinion, there will be dealers who will embrace transactional websites, and they will make it work while others fail at it…
That it is part of what makes the car business so much fun, and rewarding. To have the entrepreneurial courage to try new marketing tactics that may sell more cars…And then keep trying until you get it right!
As a leader, it is your responsibility to ensure the profitability and competitiveness of your dealership. By the mission’s very nature, you need to evaluate and try new things. You must do your best to anticipate where your market is going and to get there first. Not the bleeding edge, but the more profitable, (as Roy Busse says) unfair competitive advantage.
Ralph Paglia is vice president of digital for Tier 10 Marketing in addition to being the founder and editor-in-chief of the Automotive Digital Marketing Professional Community (www.automotivedigitalmarketing.com).