Dealers are wasting huge amounts of money on paid search because the agency is not showing the right reporting. There is perhaps no other purchase that dealers make where they give the agency a blank check and simply hope for the best. Paid search is where I see most dealers overspending, and at the same time not inspecting these campaigns at a detailed level. There are many reasons for this. For one, it’s very easy to spend money with Google or Bing, and the dealer’s agency is more than happy to both take their money, and encourage them to increase budgets. Another reason is ego, where dealers want to rank high for many keywords without a good idea if the keywords are driving shopping traffic, leads, calls, etc.
If you’ve ever sat through a monthly review with your digital agency, you know the high-level topics that are typically covered. The agency reports on how much was spent in total, what the cost-per-click was, the impression share, clicks, click-through-rate, and so on. The only conversions discussed might be phone calls, with no real goal of what a reasonable cost per conversion should be. The discussions are kept at a very high level. The agency might discuss the various keyword groups, and if impression-share is not high enough, the agency may suggest moving more budget toward those keyword groups. They never discuss what type of website shopping behavior those keyword groups are driving, and there is definitely no discussion on specific keywords that are purchased. Even though the dealer is giving the agency a blank check for several thousands of dollars per month, there simply isn’t enough time to do a deep dive in a typical 30-minute monthly call.
The old adage is, “The devil is in the details” and that is very true in this case. For paid search, the details are: 1) the keywords that are being purchased, 2) the keyword-match-type chosen, 3) the ad copy and 4) the landing page for each keyword. How would a dealer measure success at the keyword level? They would inspect the downstream performance on the website. If I’m a dealer, why do I care that we have high impression share for keywords where visitors leave the site within seconds of their visit? The only keywords I care about winning for the dealer, are those keywords that drive shoppers. What is a shopper? Someone who stays on a dealer website more than 10 seconds (at least!), visits more than one page (hopefully VDPs), and potentially submits a lead/chat/text/phone call. Dealers should be unwilling to buy clicks that don’t lead to shopping behavior, and ultimately lead to conversions. Unless someone is periodically doing a close inspection of paid search campaigns at the keyword level, to determine if those clicks are delivering shoppers, the dealer will likely have a runaway spending on their paid search.
So, what is this magic report that the agency doesn’t want dealers to see? Detailed paid-search keyword lists, that contain on-website visitor information so the dealer can inspect what the agency is spending their money on. Here is an example:
In this all-too-common example, the dealer is buying the keyword “buick”. Sounds harmless, right? Wouldn’t every Buick dealer want to rank high for the word “buick”? The agency is happy to spend the money (and charge the commissions), and each month shows the dealer how many clicks they won and lost for the word “buick”. The problem is that nobody is keeping track of how well this keyword is performing downstream in the website. It turns out, the dealer is paying for clicks on every Google search request that includes the word “buick”, including old Buick vehicles, parts, owner’s manuals, etc. How well does that traffic perform? Take a look at the five columns on the right. The internet visitor clicks, discovers they don’t like the page, and immediately leaves. Zero time on site, no VDPs, no leads, no shopping behavior, and a complete waste of the dealer’s money. Unless the dealer or agency inspects their campaigns at the keyword level, they will never discover the huge waste that occurs every day in dealerships across the country.
I hope you have found this information helpful. If you are an automotive retailer or B2C business, I would love to help you better allocate your advertising funds with a complimentary digital marketing audit, including analyzing your paid search and social media spending. I can help you greatly improve your return on ad spend and gain more transparency with your digital marketing investments.
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