Adword Agencies - Why are Dealers SO UNTRUSTING?

[Jeff Kershner]

Cars.com threw this infographic out there several days ago around Adwords – who doesn’t like an informative info graphic from time to time?

Here are a few of the key highlights:

• 1/3 of Dealers plan to change their AdWords agency within the next year – that’s quite significant.
• Only 50% of Dealers indicate that the ROI received from their AdWords spend meets their expectations.
• An estimated 30% of Google Adwords investments are poorly executed and more than half of website platforms lack complete conversion tracking visible to Google AdWords and Google Analytics.

My questions is WHY??
Why do we dealers have so many TRUST issues with our Adword Agencies?

 

[Chris Leslie]

I would ask why digital agencies have such a hard time proving they're to be trusted.

If we are going to hand over a monthly spend plus management fee one would expect a certain kind of return on that. Just saying they are gonna sell us more cars is a fools pitch. Yet, thats what they say and when they can't deliver.. well...


Not to mention how many agencies out there actually give access to their client? There is a lot of back door secrets going on when it comes to how the money is being spent and why. Someone I know recently uncovered a huge $20k + of wasteful spend by their agency because they didnt set regional settings.

I do think there is a lot of room to grow, teach and learn in this area though.

 

[Dayn Riegel]

Chris is on to it... The answer is two-part, however.

First, vendors are still - typically - treating their solutions and products/services like snake oil. Perhaps, the formula (alchemy anyone?) for gold or something.

Second, dealers don't understand what they are getting/paying for/seeing/spending money on.

I've said this before in another blog answer... Data w/out meaning *or* understanding is just 0's and 1's. You don't have to be Neo to get this stuff - you just have to be taught what to look for and then, only then, can you trust the data you are shown.

And yes, there are a ton of vendors out there that know just enough - slightly more than the average customer (read: dealer) - that they can make a snazzy infographic (sorry, Cars.com) or pie chart or another such nonsensical graph to present the data in a way it appears they are providing "results".

Wait a minute - *anything* is a result - even nothing!

I've used only a few select companies (name dropping: Showroom Logic is one) that holds the cards *but* shows true transparency and will spend the time on the phone, via text, via email or in person to point out what that info actually means.

What's the saying, "Trust, but Verify"? Problem is, if you don't know *how* to verify, how can you trust what you are being shown?

Did I answer anything here or just rant? =)

Oh, until you have someone at your dealership level, or at the group, that knows how to run even the most minute AdWords (or Bing) campaign on their own don't bother complaining to the vendor about what is or what isn't happening. You probably wouldn't understand the data in the first place. That's my un-solicited $0.02.

 

[ed.brooks]

Perhaps it something to do with the data referenced in 'Paid Search and its Tipping Point: How OEMs and Large Dealer Groups Are Leading the Charge'.

One study cited in that post states, "In 2016, U.S. auto dealerships will spend $3.93 billion on paid search; that’s 45.1% of dealerships’ total digital spend".

3.93 Billion spent by dealers
45.1% of the average dealer's digital spend

All with minimal transparency.

 

[Mike Snellenberger]

Some good points here. And spend is expected to increase significantly on digital. $14.4 Billion expected by 2020 according to this study from emarketer. https://shar.es/1E2GuU

So.....to go with Dayn's point, why wouldn't the dealership "invest" in learning the basics of Adwords. There's a lot of money that is being spent and will continue to grow. Assigning someone to be responsible for at least knowing the basics and what to watch for could pay huge dividends (and save a lot of $).

Part could be the fault of dishonest agencies selling campaigns, but simply pointing the finger doesn't fix the problem.

 

[Chubbard]

Ditto what Dayn and Chris said, but also I think there's a lot of over-promising and under-delivering (snake oil or not). I also suspect that most agencies don't invest in training their AdWords teams, or monitor how much they stay on top of Google for updates and check-ins. (Fun exercise: ask your agency how often their AdWords team turn over, or how much time they spend, per week, boning up on PPC and adjusting campaigns.)

With the money that dealers spend on outsourcing PPC and other digital ad dollars--and particularly with the amount of money that's ultimately wasted on poorly performing campaigns--it makes sense that more dealers are scaling back on agency relationships. I think it's the only way (for now) to truly lock down someone who will diligently create, manage, study, and ultimately report on those campaigns. For example: we've cut our ad spend by 75% in the last 5 months, and the ONLY way we've been able to maintain (and even out-perform) past conversion rates (with a much, much, higher budget) is because we know our account intimately.

Rare is the agency, in any market, who will know your company as well as you do.

 

[umer.autojini]

I would say it comes down to poorly executed or non existing online marketing plan. Seriously take a moment now and ask your self do you have a online marketing plan. I bet answer is no. Do you have the KPIs, Do you have strategic approach, Do you have integrated customer communication/experience. You need the plan, then techniques to grow and reach, and then act and convert on them and finally engagement.

If you are simply going by vendors promises it is going to fail.

 

[kevinfrye]

Why are dealers so untrusting?

For years, the answer was quite simple, dealers had no idea of the ridiculous commissions being taken by SEM providers, and some of this still goes on with the OEM coop programs. When dealers started waking up and seeing that they were being taken advantage of, the distrust began. As a result of working with previous providers that pulled stunts like this in the past, we now directly own and fund our AdWords account and work alongside a provider to help us manage the accounts. That provides full transparency.

I believe the second issue is that most dealers do not understand how to best measure the performance of their SEM spend. From my perspective, look at the behavior of the shopper once they respond to the ad. Are they exhibiting the behavior of what you want them to do? (look at pics, scroll down, spend time on the VDP.)

Does your solution track from click to form submission or phone call? And do you have a bid management solution to revise your AdWords spending based upon that performance?

Remember, the SEM campaign drives the traffic, and your site then needs to help provide the path to conversion. I am looking to show how to do this at DD next spring, to include some custom behavior flow work I have been testing.

There is also a lot of distrust beyond a transparent commission fee with the SEM vendor. What type of kickback or commission is the AdWords agency receiving for the total spend by their dealer customers? Ask the agencies out there about this and you seem to get a dozen different answers, hmmm.

Bottom line - common sense would show that folks don't just randomly search "chevrolet silverado lease deals in Denver" for kicks and giggles - that is the behavior of someone in the market, and you want to have a strong and effective SEM strategy. Long time SEM solution providers created the distrust in the beginning - now they need to step to earn that trust back, and providing full transparency with account spend, commission and management, combined with educating dealers how to best measure performance is the path to success.

 

[Chris Leslie]

 

[ed.brooks]

Some good points here. And spend is expected to increase significantly on digital. $14.4 Billion expected by 2020 according to this study from emarketer. https://shar.es/1E2GuU

So.....to go with Dayn's point, why wouldn't the dealership "invest" in learning the basics of Adwords. There's a lot of money that is being spent and will continue to grow. Assigning someone to be responsible for at least knowing the basics and what to watch for could pay huge dividends (and save a lot of $).

Part could be the fault of dishonest agencies selling campaigns, but simply pointing the finger doesn't fix the problem.

But while Digital spending is increasing, spending on paid search appears to have reached its tipping point:

"Borrell’s “2016 Auto Outlook – The Thinning of the Media Pack” analysis indicates that paid search has already reached its tipping point in our industry. The report highlights that U.S. franchise auto dealers will decrease their paid search spend by 62% by 2018. Additionally, U.S. auto manufacturers and ad associations have already started to invest less in paid search in 2015, and they forecast that paid search will be a smaller aspect of their digital investments moving forward.

• Paid search spend is forecasted to go down to $666 million by 2018.
• Paid search for U.S. auto manufacturers will go from $534 million in 2014 to $288 million in 2018 – a 53% decrease."

from http://bit.ly/SEMtipping​