You Might be Looking at the Wrong ROI Metrics
When you look at the size of an average dealer advertising budget, we are not talking about chump change. The most recent NADA DATA report for 2014 shows that on average dealers spend over $41,000 monthly on their overall advertising budgets. Of that total monthly spend, 26% or nearly $11,000 goes toward internet advertising. When you are talking about that much money, it is a shame to see dealers making decisions on potentially the wrong data points.
What “wrong data points” am I referring to? The most common two misleading metrics are click-throughs and lead form submittals. Don’t get me wrong, there is nothing bad about a shopper clicking to your site, or submitting a lead form. The problem is, these stats are simply not really revealing about the overall success or failure of a given sales campaign.
Let’s first talk about click throughs. Just because an email campaign, or pay per click ad caused a consumer to click, this says very little about the intent behind the action. Perhaps they were attracted to a clever offer, were looking for different content, or worse were click-bots, this says nothing about why that person (or internet robot) initiated the click. Unless you know what happened AFTER the click, you are looking at interesting but likely misleading data. I’ve seen dealers spend tens of thousands of dollars on pay per click campaigns, and were convinced it was a successful campaign simply based on click-throughs. It was only after I helped them also see that the large majority of these clicks simply visited the home page and then abandoned the site that they began to see how meaningless click throughs were when only viewed independently. You must study the metrics that demonstrate what the consumer’s intent was, if you are going to measure a campaign effectively.
Now let’s cover the lead form submittal. Yes of course I would love it if every interested shopper would submit a lead form, but the reality is only XX% on average ever fill out these forms. In most cases it is because the form is so long, and requires so many fields, that most consumers give up before ever submitting. A more common progression for active vehicle shopper on the web is that they find your site through some sort of campaign, they view specific vehicle pages (vehicle detail pages or VDPs), take note of your address or phone number, and then go offline for the dealer contact. Yes, that’s right. They don’t want to submit your form, they want to instead call you or visit your store (or both). Effective advertising campaigns that drive shoppers to your website need to effectively measure this behavior and intent. But let me tell you, measuring click throughs and lead forms won’t get you there. Click throughs are meaningless, and lead forms are far too scarce for many effective advertising campaigns.
So what should you measure? If you are running a campaign for your new or used sales department, then you want to measure how many people are actually shopping for new or used vehicles. The very best way to measure a shopper is to measure how many times they viewed your merchandise, and that measurement is vehicle detail pages (VDPs)! If you begin measuring every campaign for the sales department by VDP views, then you are measuring how well the campaign delivered shoppers to your website. You want campaigns that not only deliver click throughs or traffic, but also shoppers or VDPs. It is only then that you can truly know which campaigns are working and which ones are not.
So how do you effectively measure VDPs? Your website analytics reports are the first place to start. Simply contact your dealer website provider, and ask to see reports of all vehicle detail pages viewed, and the source of each of these views. Keep in mind, if your digital advertising company is not your website provider, you will need to get those companies connected so you can track every email, pay per click, and Facebook campaign through your website analytics reports. If you are not very tech savvy, and are having trouble setting up your analytics reports, there are companies that can provide integrated dashboards that instantly show you ROI metrics for every campaign. These dashboards will list all of your digital advertising, Google organic and paid search, Social Media advertising, etc. and who VDPs, leads, phone calls and compare this to the campaign cost, to allow you to dial in the most cost-efficient digital advertising strategy.
If you would like to learn more about how to set up this tracking yourself, or to see specific dashboard examples you can start using at your dealership, then join me on October 5-7, 2015 at the Digital Dealer Conference and Expo in Las Vegas. I’ll be presenting a session that will show you step by step how to set up VDP campaign tracking in Google Analytics, as well as show some popular dashboard solutions.
So start measuring the right ROI metrics, and join me at Digital Dealer to learn how!