If a tree falls in the woods and no one is there to hear it, does it make a sound? Or, put another way, if a dealership has fantastic deals on the vehicles customers are searching for and the best customer service in town, but no one knows about it, do they make a sale?
It doesn’t matter what kind of offers you have or how you treat your customers if no one knows about your dealership. If you want customers to find you, you have to let them know you’re there and that means marketing and advertising your dealership. You potential customers can’t know what you have to offer them if you don’t let them know through marketing. But we all know that; the question is what kind of marketing: online, TV, radio, outdoor, maybe even newspaper (do they still print newspapers?). The answer to that question will vary depending on where you are and the demographics of your customer base. “It depends,” however, is not the answer dealerships need. Dealerships need to know the best way to communicate with their potential customers without wasting money on campaigns and mediums that don’t reach their audience. So, what’s a dealership to do?
One option is to try and do your own marketing. But that means you have to learn how to market online, gather the metrics to see how your marketing performs and that’s just for online marketing. If you want to be on television, you’ll have to inform yourself about audience reach and frequency, how to target your customers, negotiate your advertising rates, find a crew and actors to create your commercial, and hundreds of other things that will take you away from the dealership and your core focus—selling cars.
The other option is to hire an advertising agency to help you with the process. This is the best choice for most dealerships, both large and small. But there are a lot of advertising and marketing agencies out there competing for your business, so how do you determine which one is best for you? The answer, like most things, depends on many factors, so we found some leading advertising and marketing experts to help you determine the kind of agency your dealership needs: David Regn, co-founder of Stream Companies and Rob Mudd, president of digital media at Mudd Advertising. Their insights should help you find the right marketing agency for your dealership.
Does every dealership need an advertising agency regardless of size, why or why not?
David Regn-Yes! It’s very challenging to find one person who knows strategy planning, design, paid search, search engine optimization, inbound marketing, media buying, project management and direct mail.
In order to excite effective marketing and advertising, a dealer needs most of these services and skill sets—and it’s much more effective having a team of specialists than a generalist.
Rob Mudd-Yes, it’s extremely valuable for a dealership to have an advertising agency no matter what their size. Agencies…can help provide a cohesive strategy to reach new and returning customers. We can help keep track of progress and it is immensely helpful to have a team of advertising experts at your disposal to help make sense of all the advertising noise. Not to mention the importance of having a team who knows what it takes to take a dealership of any size to the next level.
What skills matter most for an auto dealership advertising agency?
DR-In this day and age, an advertising agency must have all capabilities under one roof in order to launch, manage, and evaluate campaigns. From creative to media placement to digital, each is important to the overall effectiveness of a campaign.
RM-It might seem obvious, but an in-depth knowledge and feel for the industry is so important. Even more important, however, are the relationships agencies develop with their dealers allowing them to help each other push the envelope to help move the needle. It’s important to know how to work with dealerships of varying sizes, because what works for a small-town dealership isn’t necessarily the same strategy that’s going to make a difference for a multi-store or metropolitan area dealership. Being in tune with those things and knowing how to adjust campaigns according to the dealership needs is important.
How is advertising an auto dealership different from advertising other businesses?
DR-Automotive advertising is a breed of its own. The majority of dealers’ second or third biggest expenditure is their advertising investment.
The owners and managers all have input when it comes to advertising so it’s important that an agency understands retail and understands the auto industry. Otherwise, it can be very overwhelming for agencies managing multiple dealerships and multiple rooftops within a group.
RM-The auto business is heavily retail focused—the business that is happening every single day is vital. So when you’re advertising for a dealership, there is a sense of immediacy that you have to keep in mind. That doesn’t eliminate the need for horizontal branding efforts, but it does mean you have to be able to weave that in while maintaining a strong retail message 99% of the time.
How should a dealership determine their monthly marketing budget?
DR-Monthly budget should be determined based on how many cars your dealership wants to sell. The budget should then be based on a per copy basis or a percentage of gross profit. A plan is essential to hitting your goal so you do not exceed the budget.
RM-Without researching the needs and preferences of buyers in an individual market, that’s a really difficult question to answer, however as a whole we believe it’s important that dealerships recognize that part of an effective, impactful marketing strategy includes utilizing multiple channels to reach customers. We almost always recommend a media mix that includes TV, radio, print, and digital. It’s only through an effective and efficient combination of multiple mediums that a dealership can reach its fullest potential audience. What mix of those elements is the best idea is going to vary widely from dealership to dealership.
What kind of metrics should dealerships expect the ad agency to provide?
DR-From a digital standpoint dealerships should look at the following metrics:
- Total website traffic
- Total website traffic from non-page traffic
- Total website traffic from paid search
- Total website conversions from organic and paid search traffic
- Total unique visitors from both paid and organic search
- Paid search CTR, CPA, CPC, and impression share.
- Paid search must be connected to G/A
- Traffic by source
** You should also own your paid search account.
Outside of digital data, the below metrics are also important to dealerships:
- Direct mail and email
- Phone calls
- Sales conversions
- Total gross rating points
- Total impressions
- Phone calls by source
- Total leads
- Appointments set
- Appointment shows
- Total ups
- Total sales
RM-At Mudd, we love it when you succeed. For us, that means every result is important. Thus, at Mudd whatever driver you use, we bring the results into focus…we have a web based analytical program called Mudd AdSuite that show tangible results you can see, touch and measure. For instance, we have metrics in place where dealers can see directly what their ROI is on a mailer, etc. Did that work for them? What was their delivery? In order for us to continue to help you succeed, we need to know the good, the bad and the ugly and as a dealership you should want to know that to. As an agency, having metrics the results will sell themselves. Without metrics, if they can’t show you on paper in black and white, you need to ask yourselves what is your ad agency doing for you?
Is it better for a dealership to have one agency to handle all of their marketing or should they have different agencies for traditional and internet marketing? Why?
DR-It’s better to have one agency handle your dealership’s marketing to prevent your marketing dollars from becoming fragmented.
Having one agency handle all of your marketing ensures that all departments (traditional and digital) work together to get the best results. It’s easy for your marketing message to get lost across multiple agencies due to a lack of communication. It’s easier for a dealership to manage their marketing strategies as well, because they can call one person and get the answers and or work they need done right away.
Another benefit of having all of your marketing dollars with one agency is you won’t have multiple agencies competing over your marketing dollars. For example, a traditional agency might want you to put all of your budget into print and direct mail. A digital agency will want you to spend all of your marketing dollars on PPC and SEO. The problem is these agencies are looking out for their best interests and not your dealership’s.
A full service agency can help you best determine how to best implement your entire marketing budget based on your goals and what will work. One thing to keep in mind, however, is to interview and vet a full service agency to make sure they have experts working in each marketing channel.
RM-Everything is in house at Mudd and while I can’t speak for other agencies, Mudd can handle traditional and digital marketing. It is as we like to say, all in the family and all under one roof. If you can get something where everything is handled by one agency team, you’re more likely to have an easier time communicating and you’re more likely to get a cohesive message without wrinkles in the fabric, so to speak. With a single agency handling everything, there’s a unity in purpose and messaging that is hard to get when you’re divvying up the work amongst a number of agencies, not to mention a sense of ownership and a strong relationship.
We want to hear from you!
I hope that the insights from our experts help you determine the right agency for your dealership, but we also want to hear your thoughts. What have your experiences been with marketing? What worked, what didn’t? Let us know at www.DealerMarketing.com/forum and learn more about marketing your dealership throughout www.DealerMarketing.com.