The Local Agency Myth Hurts Auto Dealers

This week a dealership manager told me a story which I have heard countless time throughout my career. The storyline goes something like this:

Dealer: I didn't like the automotive agency vendor that my OEM recommended. I felt like a number. My account representative changed every 6 months. So I decided that I would pick a local ad agency to get better service.

Me: Did they have any experience running AdWords and Facebook campaigns for auto dealers? Did they ask about access to your DMS data?

Dealer: No, but they are very smart people. They work with big corporations and some local doctors, lawyers, and retailers. They told me that they would do a great job.

Me: How did it work out? Are you still happy with that decision?

Dealer: They were nice people and sincere, but they didn't understand the auto business. The monthly changes in incentives, payment calculations, required disclosures and compliance audits created too many headaches. I had to basically train them and I got hit with an OEM ad compliance strike. Sales performance? I saw a noticeable drop in sales when I left my previous auto-specific agency.

Me: What did you learn from testing a local agency?

Dealer: Stay with someone who understands automotive but don't settle for poor customer service.

Innovation in Automotive Ad Tech

I share this story in advance of the 2018 NADA Conference because there are many changes in the automotive marketing ecosystem that dealers should know about and take appropriate actions. Dealers who want to advertise efficiently online will need to turn to trained automotive agencies that are leveraging auto shopper ecosystems, DMS data, artificial intelligence, and OEM incentives and rebates.

Would a local agency know to ask for cross-sell reports or IHS Automotive intender lists? Would a local agency look at days on lot, DMS sales by zip code, or inquiry about stair-step bonuses? What about compliance? How long would it take a newbie local agency to generate consistent graphics and landing pages to avoid OEM dings?

The two largest companies in automotive marketing are CDK Global and Cox Automotive. Both companies will be unveiling updates to their online marketing and engagement strategies that a local agency could only dream about.

Their proprietary ecosystems will give dealers unprecedented and specific marketing intelligence from a network of automotive websites. This gives CDK Global and Cox Automotive a strategic advantage. They do not have to rely on a single keyword to determine shopper intent, which ad message to display, and which landing page to select.

Automotive website platform providers like Dealer eProcess have developed automotive specific dashboards and tools to track marketing investments down to an actual sale. Their CAROi software gives dealers insights that would never be possible from a local agency! When one company can measure website engagement, and integrate CRM/DMS data into marketing campaigns, the results are impressive.

Dealers who are looking for a boutique solution for online and offline advertising might consider Team Velocity and their Apollo Technology Platform. The seamless integration of online marketing and direct mail, through state-of-the-art technology, is jaw-dropping. Any dealer who visits their offices comes away with a clear understanding why a local, non-automotive agency, can't compete with experienced agencies like Team Velocity.

As a Lotlinx reseller, I have seen firsthand how artificial intelligence and a shopper ecosystem can increase inventory TURN rates and success for a dealer. Specifically, dealer groups can realize significant savings when they implement Lotlinx marketing strategies I developed at PCG for used car marketing. Dealers groups, with multiple stores in a local market, don't understand how they are competing with themselves and driving up their own click costs!

Another change in online marketing, that a local agency would miss, is that traditional AdWords strategies are becoming less effective. Consumers are using AdWords as a taxi to get to the dealer's website regardless of the ad content. You can see this in the data: less than 15% of phone calls generated by AdWords are for sales.

"It is impossible to determine shopper intent from a single keyword, yet that is how so many auto ad campaigns are created in AdWords"

When dealers start to see the high abandon rates and conversion outcomes from their "single keyword based" online advertising campaigns, it becomes clear that basing advertising landing page choices on a single keyword can be wasteful. Thankfully, many companies are using machine-learning and AI to process millions of consumer interactions daily to find that "likely buyer." Companies like Client Command and Outsell are breaking new ground in this area.

The last word of advice I have for dealers is to take the time to inspect your marketing data. I am fascinated with Google Analytics data which shows that many of the previous "rules" for online marketing are changing. VistaDash is leading the charge in dealer education using business intelligence tools for sales and marketing data.

One specific area of study is landing page choices for Google AdWords campaigns. What if I told you that landing a consumer on the dealer's home page is significantly better than an SRP, based off a single keyword? If you want to learn more about my research, stop by the PCG booth at NADA or attend DMSC.

I am also speaking on marketing attribution at NADA, so if you are attending, please attend my presentation.

Learning from The Best

I encourage all dealers who are seeking to find the very best technology and agency partners for their dealership to attend the 8th Annual Digital Marketing Strategies Conference (DMSC). Each year we attract the top dealers and vendors to have a candid conversation on what is working and what is not producing the desired results. Dealers who attend come home with actionable insights to sell more cars!

Check out the impressive lineup of speakers and topics this year by visiting: https://digitalmarketingstrategies.org/. Some of the topics we will be addressing include:

• Is Digital Retailing Working?
• Subscription based ownership models
• Uncovering Google AdWords Myths
• Strategic Social Media Advertising on Facebook
• Exploring the Benefits of Marketing Ecosystems
• Artificial Intelligence (AI) in Automotive Marketing

I hope to see you in Napa, June 3-5th for DMSC. If you would like to receive information on the conference, send me a message or email. Are you a student of automotive digital marketing, check out my books on this subject: https://pcgcompanies.com/books/