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I had an great call today with a successful car dealer that was spending over $150,000 a month on cable TV for three same brand stores in one state.    Their three store budget had no allocation for PPC, Retargeting, Chat, Reputation Management, Video Marketing, or  Mobile Marketing.

The dealer is leading his market and is profitable so his internal processes and execution are outstanding. This dealer was passionate and a refreshing pleasure to speak with today.

The TV commercials he designed branded the names of the dealerships and their current promotion. The dealer principal has set his TV budget to be omnipresent and it seems that he has achieved his goal for high frequency Cable TV messaging.

Opportunities For Continued Success

The dealer did not see the need to have PPC ads, marketing videos, or retargeting banners in front of consumers during their online ZMOT shopping research.  I felt that this was an opportunity he was missing for continued and sustainable market leadership.

I had a lot of convincing to do..and at times the conversation was heated.  Why would a successful dealer need to change anything?

Since consumers use broad keyword searches, that are not easily optimized by SEO, paid search (optimized for conversion) should be a part of a comprehensive digital marketing strategy.  Paid search campaigns should include specifically designed mobile ads and strategies.

Retargeting leverages the existing traffic generated by years of stimulus, brand recognition, and amplifies your PPC investments.  Since this dealer believes in constant name recognition, retargeting banners are the digital equivalent to offline branding.

Chat is a great tool to allow consumers to engage in a communication channel that they prefer.  Leaving chat off a website minimizes the ROI of stimulus investments.

Great Stimulus Does Not Pave a One Way Road

Stimulus for new and used car sales is constant in the USA.  When a consumer is ready to purchase a car, there is no lack of stimulus on TV, Radio, and print.  Stimulus will always be needed, however the bigger question is should the dealer by doing it?  And if so, is the budget sufficient to achieve the needed frequency to be effective.

Successful digital marketing strategies have to acknowledge that consumers go to the Internet to research and prepare before they contact a dealership.  A TV commercial is just one influence of many that drive consumers to look into a particular brand, model, dealership.

No matter how strong a TV campaign is designed, it will not bypass the Internet ZMOT process for most people. No matter how many times a dealer’s name is broadcast on TV, consumers do not limit their searches to the dealership name.

A dealer with a strong stimulus investment must have an equally strong digital presence during ZMOT.  If not, competitors will leach off that stimulus for their own benefit.

Dealers need to be omnipresent during ZMOT which includes great online reviews, compelling video assets, social engagement, great website content, and even paid search ads.

What is very surprising is that dealers who are heavy on stimulus and light on ZMOT investments can be successful and a market leader today.  The bigger question is whether that is sustainable.

The good news is that we negotiated a budget for some of the recommended digital strategies which is a great opportunity to build a partnership of success based on testing and measurement.

Since PCG started the Automotive Zero Moment of Truth in October, I have had the opportunity to view hundreds of marketing and advertising budgets.

I created a spreadsheet to plug in expenses which allocates the investments into categories for Stimulus, ZMOT, FMOT, and SMOT.

One of the most disturbing patterns is that dealers are addicted to drugs.  Not in a traditional sense but addiction to the drug of Tradition Advertising or what Google calls Stimulus spending.

The second trend is that the automotive stimulus spending is not supported during the Zero Moment of Truth.

Consumers Don’t Go Directly Into A Dealership

Prior to the Internet, a TV or radio commercial may have encouraged a consumer to drive directly over to the dealership to get more information on a particular car or sale.  Today, stimulus drives consumers to validate traditional marketing claims and research prices, features, and styling.

So if a car dealer wants to invest in cable TV, radio, and print they must have sufficient visibility online to direct that research to their own website.  This is one of the greatest opportunities for dealers who want to increase market share.  They need to reallocate resources from the Stimulus column into the ZMOT and FMOT columns.

If you would like a copy of the planning spreadsheet, send me an email.  I will also give you feedback on your marketing budget to lend an extra set of eyes and strategy to your dealership plans for 2012.  This simple spreadsheet has helped so many car dealers in the last 60 days.

Looking At Website Traffic: Adwords vs Traditional

One of the discussion points from the ZMOT spreadsheet is the cost to get someone to visit a dealership website.  We know that leads generated from a dealer’s website are the highest converting leads.

Here is a real example of a Honda dealer’s advertising investments which generated 6,132 unique visitors in the month of October.  Their total advertising budget was $80,000 a month.

Their Google Adwords campaign sent 2,200 visitors to their website at a cost of $2.27 per visitor.  They were only spending $5,000 a month on Google Adwords.

The balance of their website traffic that month was 3,932 visitors.  Their investments in traditional advertising included radio, TV, newspaper, and direct mail which cost $47,833 in October.

The dealership also spent over $15,000 on third party classifieds website and third party leads, which I am excluding from this analysis.  However, some of these investments do bring traffic to a dealers website, like Cars.com and Autotrader, but I am excluding that for now.

The stimulus investment of $47,833 did not generate all of the 3,932 visitors because brand awareness and word of mouth can yield direct website traffic.  Even, if we ignore that fact, the cost per visitor from stimulus advertising is $12.16 per visitor.

If you factor in that the Unique Visitor in October was 60% of the overall total and traffic from their third party classified investments, you could reprice the traditional advertising investments costs much higher that $12.16 per visitor. For this dealer, it could be as high as $18 per visitor.

Stop Kicking The Adwords Dog

This example is a start to a much larger discussion about budget allocations and being present in the Zero Moment of Truth.  Obviously, this case illustrates the efficiency of driving website traffic from Adwords.  Adwords is often maligned and I hear dealers claim that conversion costs and bidding was too high.  Really?  Compared to what?  Not dealer stimulus costs for sure.

When someone types in the words “Used Cars”, “Used Toyota Camry”, or “Used Cars For Sale” do you really not want to be on page one?  When you consider the money dealers spend on stimulus and the “expensive” website traffic that it generates, it is time to rethink being there 100% of the time during ZMOT.

I don’t want to imply that setting up a high converting Adwords campaign is easy.  It takes time to create the right combination of keywords and landing pages to create conversions.  However challenging Adwords may be, it is no excuse not to invest in the time to get it right.

Since consumers are being influenced by over 18 different digital assets BEFORE they contact the dealership, I would challenge every dealer to rethink their ZMOT strategy.  How many of those 18 influences are controled by you?  How is your dealership’s visibility during ZMOT.

Brian Pasch, CEO
PCG Digital Marketing
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Brian Pasch