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I know that SEO/SEM has been the trend for some time, however there are still many sources that are available for third party leads. What enhancements would you need to see in order to consider augmenting your current strategy with additional leads?

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Wow... I stumbled across this reply and was truly impressed that someone in the car business understands critical analysis and control point management. Whether or not I agree with all your statements and conclusions is less important than adopting a "critical thinking" approach to improving upon everything being done in a dealership. Personally, I recommend that dealers look at all their marketing investments by category (not supplier) each month with a critical thinking and analysis approach to the question: "With a total marketing and advertising budget of $XXX,XXX.XX, are we optimizing the allocation mix for maximum impact on our objectives...". When I manage or consult with dealership Internet departments, there is always some level of purchased leads that become part of the overall budget. Why? Because it is a logical and rational decision based on a methodical analysis of historical ROI and it is part of having a comprehensive strategy.

For example, it seems illogical to me that any dealer would buy leads from a supplier like AutoUSA or Dealix for years and years... Then a decision is made to "stop buying 3rd party leads" and a source of 10, 15, 20, 30 or however many deals sold each month to leads from these suppliers is simply erased... I don't get it... I have done it, suffered from the negative consequences, and then in hindsight saw how ignorant I was to shut off previously good long term partners... You knoow what makes a LOT MORE SENSE? If you have been increasing your self-generated leads to a point where you are comfortable cutting back on marketing budget allocated to 3rd party leads, then consider the following scenario:

OLD 3rd Party Lead Buying Budget:
150 leads (<35 miles) each month from Dealix @ $20 = $3,000
50 leads (<35 miles) each month from AutoUSA @ $20 = $1,000
50 New Car leads each month from Autobytel @ $20 = $1,000
25 leads (metro market) each month from Jumpstart @ $20 = $500
100 leads (<35 miles) each month from iMotors @ $20 = $2,000
--------------------------------------------------------------
Total 3rd Party Lead Budget (OLD) = $7,500.00

NEW 3rd Party Lead Buying Budget:
50 Truck and SUV leads each month from Dealix @ $20 = $1,000
25 leads (20 miles) each month from AutoUSA @ $20 = $500
20 Used Car leads each month from Autobytel @ $20 = $400
25 leads (metro) each month from Jumpstart @ $20 = $500
50 leads (20 miles) each month from iMotors @ $20 = $1,000
--------------------------------------------------------------
Total 3rd Party Lead Budget (NEW) = $3,400.00

In the above scenario, we reduced the 3rd Party Lead Budget by OVER 50% and increased both the quality of the total lead mix, and the vehicles being sought is better aligned with what we need to sell. After all, if you are a Toyota dealer, buying Prius leads may have zero impact on your store's total Prius sales... So why would you buy them?

Too many people in the car business want to make sweeping statements that portray decisions about the subject matter as being black and white, when in the real world, we need to optimize a hundred shades of grey to maximize our marketing efficiencies, sell more vehicles, and reduce our advertising cost PVR.

Any dealer can log into their Dealix administration tool and place check marks next to make, model, type, year and other variables that specify which leads on what vehicles you are willing to pay for... I've had months when I only checked 2 or 3 models, and my lead volume would go from 300 to 50 leads... And the bill reflected that reduction. So why would you just shut off such a powerful tool, instead of managing it?

Automotive Lead Exchange (ALE) lets dealers bid on leads by year, make, model, financing, geography and more... You cannot convince me that a Ford, Chevy or Dodge dealer in the current market conditions would NOT be able to capitalize on Truck and SUV leads within 20 miles of his dealership, and only from zip codes with average income levels over $100K a year.

Most members of ADM probably know my reputation for developing powerful and highly effective strategies and tactics that generate thousands of home-grown leads for dealers... But, You know what? If you really want to get good at generating your own leads while working at a dealership, then you need to study the way automotive lead providers generate leads. And what better way than to keep doing business with them, but scale the expense back by cherry picking the very best leads from them as you grow your own lead generating capabilities.

When somebody tells me that they have stopped buying any 3rd party leads, I ask them 2 questions:

1. Which competitor now gets the leads from these suppliers for the customers that live within 5 miles of their dealership?

2. Correct me if I am wrong, but I see you have 150 new 2008 Pickup Trucks in stock, and it is almost October 2008... Have you decided that it is NOT a prudent and wise decision to buy leads originating from the area close to your dealership that have selected a New 2008 Pickup Truck?

Think... Construct a plan based on what you need or have available to sell, and then boil it all down to your best guestimate based on historical numbers. It simply does not make sense to fire a well run, high integrity 3rd party lead provider when you can manage which leads you are buying by vehicle, customer, location and other parameters that can be used to optimize your results.

Oh yeah... Then take the $4,100 you saved on 3rd party lead buying fees, open up a Google Adwords account, create a Keyword targeted search advertising campaign. HOWEVER, only bid on keywords that your dealership's website is NOT organically ranked by Google within the top 5 free listing positions. That might use up around $1,500 to $2,000 a month if you are in a large market, far less in rural or less densely populated regions. Take the remaining $2,000 left from your 3rd party lead provider budget cut and allocate $800 to a professionally produced monthly eNewsletter that goes out to your best 20,000 email addresses (I had over 200,000). Make sure you go with either Outsell or IMN because they are both whitelisted and they both do a great job. With the remaining $1200 to $1700 in your former 3rd party lead provider budget, create placement targeted Google Adwords campaigns using animated Flash based digital advertising. Pick 100 websites that you are going to have your ads appear on whenever anybody located within your Google Metro geotarget area. For example, if you are a Ford dealer, get the space on FordF150.net, Ford-Trucks.com, Stangnet.com, BlueOvalNews.com, etc. If you are a Chevy dealer, use your adwords account to own websites such as GMinsidernews.com, Chevy-Volt.com, SilveradoSS.com, ChevyCobalt.info, Chevy-Malibu.com, etc.... And, there are many makes that would do well with sites like FamilyCar.com, AutoMallUSA.net,, Auto123.com, AutomobileMag.com, NewCarTestDrive.com and hundreds more. Sometimes Google can make it challenging to find the best sites (they need to sell you the dogs), but I have collected over 1,400 automotive website URL's that you can use Google Adwords to bid on website space and place animated Flash display ads (like the 2 San Francisco Ford Ads on ADM's home page), Click-To-Play Video Ads, Static image ads, text based ads and all kinds of eye catching creative displays to capture a car buyer's attention BEFORE they go to a 3rd party lead provider website and submit a lead!
Ralph, you speak the truth. I am not sure that most stores realize that they can turn vehicles off. When I was selling, I made sure we always turned off any limited production model, any allocation based vehicle, and any vehicle I couldn't readily trade for. By doing so, we rarely hit our lead ceiling. More importantly, we weren't having to tell people "I can't" all of the time.

Dealers need to set themselves up to reach the people that want to hear their message most. Make those customers happy, and they will do the advertising for you for FREE!
Brad, I couldn't agree more with you. Even though I am on the technology side of the fence, there isn't a better thing than a committed work force. The best of the best have been part of this business for a long time, and profoundly believe in what they do. Others have had great mentors to help them along the way. But, what about the rest? They read lots of articles, and try the latest and greatest. It's like giving a kid a supercomputer, and expecting them to discover a cure for cancer. Giver her about 25 years, and she could do it...

I am not going to directly plug our service. But one thing I can tell you, is that we advocate it is up to the dealership to make it succeed. And, we want to make sure our dealer partners understand how to treat their customers (leads) the way that they most want to be treated. Don't use the technology to take on another 1000 leads. Use the technology to find the customers who work best for you, and what you have to offer.
Employers will pay more for a salespeople who love their job and do a better job because they love doing it. Dealers will buy more leads when those two situations are in play.
Ralph,

I disagree with on one thing and if you look at it different angle you might as well. IF a provider is generating his own leads and only sending them out one time there there is no duplication. Its not his fault you have signed up with 3 or 4 providers. That would be like saying you have to give a credit to other dealership the customer walked into before he walked into yours. This is not an issue if you only buy real time leads from providers that generate their own leads. Not from Lead "clearinghouses"
Hi Bill,

If Trilogy and you are involved that would be a good beginning! The credibility of the source is a key factor in my experience since the vendor's reputation is as much at risk as my clien't money and my job!

That said, performance based models that exist beyond a "gurantee" - talk about an abused selling technique - would be another key factor. In my mind performance needs to be tied to actual R.O.I. - not volume of leads or even conversion rates. A source that could follow the lead through the CRM and/or DMS to actually quantify the value of the sale would be of enourmous value. I know of other applications that follow and link the customer information and the vin in both sales and fixed operations with an actual profit value assigned to the source. That would get my attention if it were assigned to a third party lead source!

Finally, pre-filtered leads confirmed against national data bases with post office information including demographic and economic profiles of the customer would be nice! Again, this information is already available in other applications so providing these insights before contacting the lead would help!

PS: I was just about to hit send and I noticed Ralph's comments and I should add that third party leads represent a seperate line item in my automotive advertising budgets with their own accountability for their R.O.I. so they are not a substitute for anything! They may fight for a piece of a reduced budget, and they may be on the short list of the first investment to cut if things get tight since experience suggests that home grown leads do better than outsourced ones - but they live or die on their own; as with all automotive advertising investments.

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