Are Dealers Spending Too Much On Paid Search?

[Steve Stauning]

If you're not tracking from the keyword to the sale, then you're either with a bad SEM or you're not asking the right questions. (CTRs, Impressions, etc. all make nice, pretty graphs, but are meaningless when determining ROI.)

 

[joe.pistell]

If you're not tracking from the keyword to the sale, then you're either with a bad SEM or you're not asking the right questions.

Steve,
How does one connect a keyword to a sale?
(caution: I willingly asked you this, knowing the answers)

 

[joe.pistell]

High level thoughts.

Thought #1). IF ALL ADVERTISING WAS FREE, WE'D USE ALL OF IT (print, mail, billboard, TV, digital, digital classifieds, etc). This means the discussion is about ad spending yield.

Thought #2) "Dealer's are like snowflakes, no 2 are alike". Advertising must match the dealer's profile AND the dealer's profile must match the dealer's ad strategy. For example, a dealer who's inventory is poorly managed (selection & price) may have high ROI from direct mails (and poor ROI in digital classifieds and short tail PPC). Another dealer profile is the big fish in his market. This dealer has a giant inventory and ad spending with a marketing strategy to push shoppers directly to his site. The big fish's strategy is to become an internet shopping destination where he competes with AT and Cars and Gurus. This dealer can justify very short tail keywords with far higher CPCs.

Thought #3). Like Ed said, it's all about balance. It starts with the Dealer's profile 1st. Once you have the dealer's profile (i.e. strengths and weaknesses), THEN you can strategically deploy ad dollars.

 

[Steve Stauning]

Steve,
How does one connect a keyword to a sale?

Tracking.

 

[joe.pistell]

Tracking.

Steve... Tracking what? The moon's distance from earth? C'mon, speak to the details. We're all here to share insights.

 

[Steve Stauning]

caution: I willingly asked you this, knowing the answers

C'mon Joe, but no offense, I don't like games. If you know the answer, please share. Don't keep us in suspense or try to trap one of us into saying something that Ed Brooks can take out of context and post on every website in the world.

There is no magic to tracking - just that most SEMs either purposely remove the transparency in their offering or they don't set it up properly in the first place. No one here needs to know the exact nuts and bolts, other than to tell their SEM: "If your solution cannot show me which specific keyword drove Mrs. Customer to my site and eventually led to a call or lead from her that got recorded in my CRM as having originated from your services, then I will look elsewhere."

 

[mwpistell]

I have more to say but I'm going to refer to @mwpistell for the rest because he knows way more than me...

Thanks Jeff

In "It’s Enough to be ‘Found’, Right?" I look at the data; dealers will spend very close to 4 billion on paid search in 2016. Then I look at the analyst's prediction that the paid search spend will go DOWN by 62% in the next two years. My question to you is, do you think dealers are spending too much for very limited returns? Are there smarter places to spend the money?

Overall, yes I believe most dealers are hemorrhaging money in digital marketing. Most providers tie their markup fee as a percentage of overall ad spend, so they have a huge incentive to keep pushing a dealer to spend more every month. I avoid this conflict of interest by charging a low flat fee so dealer's don't think I'm trying to line my pocket when I suggest a spend increase. The flat fee builds trust between me and the dealer.

 

[ed.brooks]

Steve... Tracking what? The moon's distance from earth? C'mon, speak to the details. We're all here to share insights.

There is a tremendous potential (mis)attribution problem with 'tracking'. Consider the scenario that Steve White wrote about in "The True Cost of Google Analytics"

"A customer first discovers your dealership via a third-party auto listing site. Then they come back to your site later by searching your dealer name on Google and clicking on an AdWords listing, which perhaps was right above a free Google organic listing for your website. By default, in Google Analytics, that AdWords click took 100% credit for that visitor, assuming as a fact that it was incredibly valuable, when it may have had no impact at all on whether or not that sale was made." ​

Influence, not "last click", is what matters.

And @Stauning, I apologized to you for quoting you (accurately), and as I said months ago, I will not do it again (probably)

Please accept my apology for quoting you Steve ; I shan't do it again.
Again, I need a damn sarcasm font

 

[Rick Buffkin]

Advertising must match the dealer's profile AND the dealer's profile must match the dealer's ad strategy.

In your opinion @JoePistell and @Ed Brooks, what is a good formula / process for determining a Dealer's Profile to determine the correct advertising path / structure / balance?

 

[Steve Stauning]

A customer first discovers your dealership via a third-party auto listing site.

Ugh.

Or, drives by your dealership.

Or, saw your television commercial.

Or, heard about you from a friend.

Or...

No one said fully-transparent PPC tracking was a panacea, only that without it, you need to find a different SEM.

(Again, Ed, you've quoted me out of context.)