Does SEM work? Not according to this stinging indictment.

[csabatka1]

I would be interested in how this effected your lead count. According to the Dataium study, traffic coming off of cars.com (assume it would be the same for AutoTrader) are much more likely to submit a lead.
What is your internet budget compared to the total advertising budget?

When I created a Lead Count / Sold / Search Engine Traffic line chart (which I probably can't post). With PPC campaigns running or Lead / Sold lines increased proportionally with the increase in Search Engine Traffic.

I only figured one of our locations. So the paid Visitor Total is a small sampling from the chart above. These numbers are web form submissions only - not visitors who came to our website or mobile site from a PPC and called the dealership. I do know on average 35% of our website leads come from form submission. The remaining 65% comes from phone or chat. Phone calls from our mobile site drives this % up.

Total PPC Visitors: 3064
Form Leads Submissions From PPC Visitors: 203
PPC Conversion Rate: 6.6%

 

[ed.brooks]

Ed,

Repeat visitors are a great thing for car dealers. From my 20,000+ surveys at delivery, one of the hallmarks of a buyer is multiple visits to the dealers website.

Funny how this metric was the where the low ROI came from. It just goes to show how different the 2 business models are.

Now you're getting into the spirit of this!

 

[ed.brooks]

This past Tuesday, I sat in on a webinar that Brian Pasch did that was called "Becoming VDP Factories". We've known for quite a while that Vehicle Detail Page views are one of the most important metrics to measure for our 3rd party partners like Autotrader and Cars.com, and there is a direct correlation to VDP views and sales (assuming the sales process is good).

Next to a phone call / email / chat, the most important thing you want from your website is to maximize the number of vehicle detail pages that are looked at. What I learned from this webinar is how to look at the % of visits that resulted in a vehicle detail page view, and look at it from each source, including your SEM spend. I assume it's different for each dealership, but if you spend $1,000 on SEM and get 500 visitors, what percentage of them viewed a VDP- 30%, 60%? What was your cost to have that visitor view the VDP aka cost per VDP?

IMO this is how we need to start evaluating our SEM spend. Anyone else sit in on this webinar?

Josh, I watched the recorded webinar and liked it a lot. It's very good to see Brian jumping on the "VDP Bandwagon". Those of us that have been banging the VDP drum welcome him.

I would say that increased VDPs is the MOST important thing whenever you're looking at automotive digital marketing. Calls, emails, chat sessions are all leads. A majority of your customers will never submit a lead in any format - they simply show up at the dealership AFTER conducting a considerable amount of research. I'd submit to you that a website's job isn't to generate leads, it's job is to help your customers complete their research and make a purchase decision. VDPs drive traffic to your lot.

Classified sites tend to generate VDPs at a considerably reduced cost than SEM - as Brian mentioned in his webinar.

 

[ed.brooks]

In Aug-mid Jan I ran a decent manual SEM campaign. 3 markets, St. Joseph, MO, Lincoln, NE, and Grand Island, NE. We have Ford, Lincoln at all locations, Kia at St. Joe and GI, and Mazda and Pre-owned store in Lincoln. I set up campaigns for new and pre-owned in each market.

What I found was:
Lincoln market (our biggest) was cheapest PPC and users searched more new vehicle search terms and very generic (new ford dealership, new f-150, etc.)
St. Joseph market was searching more pre-owned and very specific sets of keywords (ex. used Ford F-150 for sale in St. Joe)
Grand Island market was nearly 1.5x cost PPC over Lincoln and users search a mixed of new and pre-owned.

Conclusions From Analytics:
Depends on you unique market if SEM approach is best. Our markets showed different levels results and I cannot track exact sales or leads on SEM traffic, I can only do a comparison traffic to sold or website lead chart and website solds and leads trended up with the the search engine increased traffic. Website conversion rate and website solds remained consistent (within 2% of previous month). With that data I can say or assume sales increased based on increased traffic, due to SEM - to what degree, it is not measurable.

Looking at the Total Search Traffic column you can say that it appears the traffic remained somewhat consistent with a small bump in July/Aug. But if you take out monthly trends and compare it previous year, we saw substantial increase in total search engine traffic over the previous year. SEM took away from some Organic visitors, but still show increased in total shoppers over previous year.

From what we experienced we decided to go to an all or nothing managed SEM approach with Haystak in March as an AutoTrader replacement. This will be able to give us better numbers and stats of if a SEM approach works for us. Does this really work? We will see within a few months. We didn't stop or tv, direct mail, or other marketing avenues, just took AutoTrader out of equation and inserted paid SEM. All-in approach is never good, we still wanted a good mix of marketing avenues.



Analytics (we increased budget in late Oct):

Month	Paid Visitor Total	Organic Search Traffic	Total Search Traffic	Search Traffic Increase Over Previous Year
May	0	9,300	9,300	2,661
June	0	11,864	11,864	4,913
July	0	13,189	13,189	4,924
Aug (28 days paid)	1,158	12,868	14,026	6,246
Sept	1,253	10,560	11,813	6,801
Oct	1,723	10,951	12,674	6,400
Nov	3,369	8,362	11,731	6,032
Dec	4,391	7,991	12,382	6,577
Jan (12 days paid)	2,600	9,761	12,361	4,352
Feb	0	10,079	10,079	3,587

Chad, I wish you all the best. Contrary to what I told <strike>Uncle Joe</strike> Pope Joe above, there are some very real differences between successful Automotive marketing and the rest of the marketing world; chief amongst these is the shear amount of research conducted by shoppers. This makes ANY traditional attribution model ineffective - last-click, first-click all shriek in agony when they see the complexity of the AVERAGE automotive shopper journey.

I would be interested in how this effected your lead count. According to the Dataium study, traffic coming off of cars.com (assume it would be the same for AutoTrader) are much more likely to submit a lead.
What is your internet budget compared to the total advertising budget?

In addition to the increase in leads that Doug notes above in the Dataium study, AutoTrader studies show a marked increase in positive shopper behavior; Visitors with AutoTrader.com and/or Kelley Blue Book Activity were a third More Likely to view your VDPs, they would look at 50% More Pages, they would spend 50% More Time on your site and are nearly Three Times Less Likely to bounce.

In the interest of full disclosure Chad, I worked at AutoTrader for a decade, but even when I was at ATC, I was always advocate of a balanced approach when it comes to Automotive Marketing. I am a strong proponent of SEM (just not of buying "Billy Bob's Ford" - when you're Billy Bob). I even believe that traditional advertising has a place in every dealer's arsenal. The key is balance.

"Digital Audience Analysis: Understanding Online Car Shopping Behavior and Sources of Traffic to Dealer Websites" - AutoTrader

 

[csabatka1]

Chad, I wish you all the best. Conrary to what I told <strike>Uncle Joe</strike> Pope Joe above, there are some very real differences between successful Automotive marketing and the rest of the marketing world; chief amongst these is the shear amount of research conducted by shoppers. This makes ANY traditional attribution model ineffective - last-click, first-click all shriek in agony when they see the complexity of the AVERAGE automotive shopper journey.


In addition to the increase in leads that Doug notes above in the Dataium study, AutoTrader studies show a marked increase in positive shopper behavior; Visitors with AutoTrader.com and/or Kelley Blue Book Activity were a third More Likely to view your VDPs, they would look at 50% More Pages, they would spend 50% More Time on your site and are nearly Three Times Less Likely to bounce.

In the interest of full disclosure Chad, I worked at AutoTrader for a decade, but even when I was at ATC, I was always advocate of a balanced approach when it comes to Automotive Marketing. I am a strong proponent of SEM (just not of buying "Billy Bob's Ford" - when you're Billy Bob). I even believe that traditional advertising has a place in every dealer's arsenal. The key is balance.

"Digital Audience Analysis: Understanding Online Car Shopping Behavior and Sources of Traffic to Dealer Websites" - AutoTrader

I agree a balanced approach to be the best solution both digitally and printed advertising. That I will not argue with.

I know AutoTrader uses this study or like studies why a dealer must retain them and as their argument why dealerships don't see referring traffic, phone calls, or form leads from VDPs on AutoTrader. They use the "indirect referrer" argument because they know dealerships cannot track these without spending serious money and time.

Of the 3,000,000 shoppers across 1,300 dealer websites, how many of those 1,300 dealers were advertisers on AutoTrader and/or KBB.com? If the dealer was not an advertiser on AutoTrader and/or KBB.com were those visits eliminated or used as a part of this study? If those visitors to non-advertising dealerships were used as part of the stats below, AutoTrader is taking credit for traffic it shouldn't have. AutoTrader did nothing to bring traffic to the non-advertising dealer's website.

34% of all monthly visitors to a dealer’s website visited AutoTrader.com or KBB.com first.
68%, or 7 out of 10 visitors, used a search engine to access the dealer site after visiting AutoTrader.com.

To me, these numbers more proves that car shoppers use multiple sources when car shopping and you cannot responsibly say AutoTrader.com and/or KBB.com was driving force to dealer's website traffic. If true, after March 1, 2013 (when we dropped AutoTrader) our websites should see a 34% decline in overall traffic and a 68% decline in organic search engine traffic.

 

[ed.brooks]

I agree a balanced approach to be the best solution both digitally and printed advertising. That I will not argue with.

I know AutoTrader uses this study or like studies why a dealer must retain them and as their argument why dealerships don't see referring traffic, phone calls, or form leads from VDPs on AutoTrader. They use the "indirect referrer" argument because they know dealerships cannot track these without spending serious money and time.

Of the 3,000,000 shoppers across 1,300 dealer websites, how many of those 1,300 dealers were advertisers on AutoTrader and/or KBB.com? If the dealer was not an advertiser on AutoTrader and/or KBB.com were those visits eliminated or used as a part of this study? If those visitors to non-advertising dealerships were used as part of the stats below, AutoTrader is taking credit for traffic it shouldn't have. AutoTrader did nothing to bring traffic to the non-advertising dealer's website.

34% of all monthly visitors to a dealer’s website visited AutoTrader.com or KBB.com first.
68%, or 7 out of 10 visitors, used a search engine to access the dealer site after visiting AutoTrader.com.

To me, these numbers more proves that car shoppers use multiple sources when car shopping and you cannot responsibly say AutoTrader.com and/or KBB.com was driving force to dealer's website traffic. If true, after March 1, 2013 (when we dropped AutoTrader) our websites should see a 34% decline in overall traffic and a 68% decline in organic search engine traffic.

Chad, I was serious when I wished you well with the experiment. I don't think AutoTrader or any other website can claim to be THE driving force behind consumer visits to a dealer site. But I also don't think ATC claimed that - they did say that third-party sites are A major driver of traffic to dealership websites - a very different thing.

And as Brian Pasch demonstrated in his webinar, third-party sites can deliver VDPs very cost effectively.

 

[joe.pistell]

When I created a Lead Count / Sold / Search Engine Traffic line chart (which I probably can't post). With PPC campaigns running or Lead / Sold lines increased proportionally with the increase in Search Engine Traffic.

I only figured one of our locations. So the paid Visitor Total is a small sampling from the chart above. These numbers are web form submissions only - not visitors who came to our website or mobile site from a PPC and called the dealership. I do know on average 35% of our website leads come from form submission. The remaining 65% comes from phone or chat. Phone calls from our mobile site drives this % up.

Total PPC Visitors: 3064
Form Leads Submissions From PPC Visitors: 203
PPC Conversion Rate: 6.6%

Chad,

Wonderful work as always. TY. When I was in your seat at a 3 roof dealership, we carpet bombed TV to drive traffic to our website. The cost per TV visitor was $6 to $7 (top level summary: unique's, incl's new and returning). The business was highly successful, so I used the "visitor engagement profile" of the $6 dollar TV visits as a baseline to compare short tail PPC ads coming in at $2.25ish.

The short tail PPC "visitor engagement profile" was weaker than the TV "visitor engagement profile", but not significantly. In this case (but not for everyone) this was a PPC win.

 

[joe.pistell]

... there are some very real differences between successful Automotive marketing and the rest of the marketing world; chief amongst these is the shear amount of research conducted by shoppers. This makes ANY traditional attribution model ineffective - last-click, first-click all shriek in agony when they see the complexity of the AVERAGE automotive shopper journey. ...

Could not agree with you more Ed. We all agree that Google is the HUB of internet research. and this is why SEM works. Dealers are simply trying to add SEM to a successful AutoTrader/Cars/Craigslist TV and Radio marketing mix.


Does this mean you've come to embrace SEM your title is a little scary...


Does SEM work? Not according to this stinging indictment.

According to this article published online on March 11th in Harvard Business Review/Slate, eBay has come to the conclusion that SEM - paid search - is a waste of money.

 

[joe.pistell]

In the DR community spirit, I'd like to add some real concerns to Ed's thread and air out a real PPC problem that no one talks about.

IMO, there is a real story of $'s wasted and lost opportunities in SEM.

1. Your SEM campaign setup can create giant business boosters, or become a dumpster where you toss a chunk of your cash into (details below).
2. OEM compliance for certain franchises is very limiting. SEM is a very simple and mechanical advertising system. OEM compliance departments like this and can limit your GEO and shut off a wealth of opportunity.
3. AutoTrader can expand your GEO footprint because it does not have these OEM compliance constraints (that I am aware of)

re: SEM setup

...
If your entertaining PPC... again, your inventory profile is important. Heres a chart I made for DR about 3-4 years ago

• phrase = # of words in the phrase that you're bidding on.
• Traffic = How much traffic this phrase can bring
• Web Skillz = How web savvy the shopper is
• Time in Market = an assumption that the more complex the phrase the longer they've been shopping
• Cost of PPC = the ad Cost Per Click
• What are those arrows? = They indicate a direction of trend, from lowest to highest.

BIG DEALER:
This is a line by line look at how a big dealers inventory profile can influence PPC ROI. For Big Dealers, the width and depth of inventory can work with the short tail, high traffic phrases like "Used Cars".


Boutique Dealer:
Smaller inventory may not satisfy a shopper looking for "used Cars". Your best ROI will come from "long tail" key words (i.e. how much is a used vw passat with low miles) There are ad tools* that automatically build your PPC ads. These tools take a feed from your inventory, so your ads are created by the cars in your inventory. If you have a 2009 Chevy Tahoe tradein in stock, the ad is made and shown. When it sells, it dissapears.


*The 2 best vendors in this space (that I know of) are HayStak and DDC's Total Control Dominator.



Summary:
Small inventory profile means be very very selective on your keywords, your GEO circle and your spend.
Big Inventory profile means be VERY agressive and consider AT or Cars.com as your competition.

HTH

From this thread:
http://forum.dealerrefresh.com/f43/see-you-later-autotrader-2495-12.html#post28094

 

[ed.brooks]

Could not agree with you more Ed. We all agree that Google is the HUB of internet research. and this is why SEM works. Dealers are simply trying to add SEM to a successful AutoTrader/Cars/Craigslist TV and Radio marketing mix.


Does this mean you've come to embrace SEM your title is a little scary...


Does SEM work? Not according to this stinging indictment.

I lifted the title from a line from the Search Engine Land article. And Joe, I LOVE bombast!

My only problem with SEM (well my main problem) is the practice of buying your own branded keyword - "Billy Bob's Ford". It appears as if much of the discussion about this study in the broader online marketing is centering on this practice as well.

What do you think Pope Joe, would you buy "Billy Bob's Ford" (If you were Pope Billy Bob).