Automotive dealers want to make sure they’re spending their marketing dollars where they should. Here, we’ll explore how to do that by:
• Taking a high-level view of the best performance metrics to watch and how to avoid common pitfalls
• Explaining how to gauge influence and attribute linked sales to the right vendors
• Demonstrating how Google Analytics can prove which vendors are doing what they’ve promised so you can reevaluate your budget for the future
As a dealer, you need to understand how to measure the effectiveness of your marketing. There is more data out there than ever before and increasingly sophisticated technologies that aim to make your lives easier — or at least they should be.
It’s next to impossible to prove if traditional marketing efforts, like mailers or TV ads, have an effect unless the customer who walks in the door mentions that piece of marketing. Digital efforts are easier to track because of changing technologies, but still, many vendors take credit for the same sale. So what metrics should you be watching?
• Are your customers converting?
• Is the brand (and your dealership specifically) top of mind?
• Do your advertising and marketing efforts add value to the final sale?
Start by looking at your monthly goals and thinking critically about how those are set. Agree with your general manager, owner and other stakeholders about what percentage of revenue makes the most sense to be the responsibility of marketing. What ROI are you shooting for and why?
Make sure to allow time for your marketing to ramp up, especially when employing new marketing programs or working with new vendors. It’s easy to say in this industry that if something doesn’t show enough ROI right away, it needs to be dropped. But we recommend giving new programs at least 90 days. That’s how long it takes to start seeing results from a marketing automation solution driven by behavioral targeting and AI, just like Netflix needs to see a few months of activity from you first before it can accurately recommend your next favorite TV series.
Linked Sales and How to Best Attribute Vendor Influence
Say your top salesperson sold a car. Great, right? But if you don’t know which of your marketing campaigns touched that customer along the way, you’re missing out on tracking what really works so you can tailor your marketing spend with the right vendors next month.
Instead of looking at direct sourced leads — this person came to the Website and filled out a form for a test drive, therefore the Website gets the credit — you should also be tracking influence so you know whether or not that same individual had already been engaging with your email communications, saw your ads on Facebook, and likely chose you because you showed them the content they wanted to see just like they’d expect from an Amazon recommendation.
The Website was still the source of this lead, but marketing had an influence on the eventual deal — there is a reason the customer visited the Website in the first place.
There are two main things to look for in order to attribute a linked sale with one of your vendors:
1. Engagement — This could be an open, click, impression, etc., depending on what you decide makes sense for each vendor.
2. Timeframe — Any engagement within a 90-day window of when the sale occurred is fair to consider as linked.
It’s also important to look at industry benchmarks to see how other dealers measure success.
Every one of your marketing channels is raising their hand on linked sales saying, “Me, me, me, I get the credit!” If they can’t prove a direct sale, vendors should at least be able to prove influence.
But even more important than looking at whatever reporting your vendors provide is using an outside, unbiased platform to hold them accountable — Google Analytics.
Proving Which Vendors are Doing What They Promised
Now it’s time to dig deep into how you can hold your vendors accountable for what they’ve promised to deliver.
Google Analytics (GA) is a great tool for this, and most dealers already have it. It’s free to set up, and all you need to do is place the GA tracking code into your Website. GA also provides unbiased third-party data that helps you evaluate individual vendor performance, giving you a true picture of which vendors influenced which deals.
But how do you use GA to your advantage? What questions should you be asking? Is there a one-size-fits-all metric for vendors?
The three metrics you’re most likely to focus on in GA are bounce rate, time on site and pages per session.
But not all vendors are created equal. You hire different vendors for different reasons, so before you decide that only those three metrics matter, ask yourself, “What did I hire this vendor to do?”
For example, chat services will never drive a great amount of traffic to your Website, therefore their pages per session score will constantly be low, but they could be supporting a more effective time on site, meeting or exceeding your expectations. See the difference?
Bounce rate is another metric used to benchmark vendor quality, but again, it depends on what expectations you’ve set for that vendor’s product. If a customer receives an email and uses it to find directions to your dealership, they will most likely click on “Contact Us,” be directed to your Website and then immediately click the Google Maps link. This path would populate as a “bounce” for the associated vendor, but they have performed the task you set out for them — driving customers to your store.
Make sure you talk with your vendors and understand what results make sense for their products. All vendors should discuss what goals can and should be achieved with their products and be willing to review their performance in GA.
Now more than ever dealers have incredible digital programs available to them that create an unforgettable consumer experience. Use Google Analytics to your advantage to optimize your marketing spend.
We hope this information proves helpful when evaluating performance metrics for your marketing efforts and where to focus your marketing spend.