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Car Dealers Slow to Adopt Digital Marketing Tools; Not Sure About Social Media

Car Dealers Slow to Adopt Digital Marketing Tools; Not Sure About Social Media

It is not what ADM Professional Community Members want to hear, but we need to be aware of the perception challenges we still face and take every opportunity to overcome them...

Car Dealers and other Small to Medium Sized Businesses (SMB) are using a number of different tactics to draw new business.  This according to [download page] a Forrester Consulting study commissioned by Act-on Software, but digital marketing continues to take a backseat to tried-and-true face-to-face tactics.

 

Asked which techniques they use to acquire new customers, at least half indicated they were using 14 of the 15 identified. Leading the pack are personal relationships and networking (95%), tradeshows and industry events (89%), and in-person events (86%). Content marketing is also popular (83%), as is print advertising (77%) and PR (74%).

 

It is encouraging to see "Content Marketing" as the fourth most popular marketing tactic being used by many businesses (83%), but there is a tremendous amount of room for improvement in efficacy of strategy and tactics around content marketing that we continue to see throughout the automotive vertical.

 

The most popular automotive digital marketing tool is SEO, used by 73% of respondents. Beyond that, Car Dealers and SMBs are using a variety of digital tactics, including email marketing (72%), social media marketing (69%), digital advertising (61%), webinars (58%), and PPC (50%).

 

Social’s Worth Still Hasn’t Been Proven

The relatively low figure for social media marketing strategies and tactical adoption is surprising, and lower than in recent research.

 

Still, there seems to be a perception among Car Dealers that social media has not yet proven to be useful. For example, among the Act-On Software survey respondents using social marketing, 81% are using Facebook – but about 40% of those say they don’t know if it’s working. Similarly, 74% are posting on Twitter – but more than one-third of those are unsure of its usefulness.

 

Getting More Leads A Prime Challenge

The report – “Driving SMB Revenue in a Tough Economy” – also finds that the top marketing challenge for Car Dealers and SMBs is converting more leads into opportunities, cited by 41%, slightly ahead of closing more deals from existing lead flows (39%). What’s interesting is that marketing programs aren't being found to be prime contributors to the sales pipeline. In fact, most respondents said that less than one-quarter of their leads are attributed to a marketing program. The average contribution of marketing programs to that sales pipeline is 35%.

 

The study suggests that Car Dealers and other locally based retailers aren't making enough use of marketing automation – only about 1 in 5 said they had implemented software that automates marketing and lead management processes. That compares to 56% who have implemented CRM technologies, and is despite other findings showing a correlation between use of marketing automation and revenue growth.

 

Source: www.MarketingCharts.com

Views: 628

Tags: About, Adopt, Car, Dealers, Digital, Marketing, Media, Slow, Social, Sure, More…Tools

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Comment by Keith Sponburgh on November 19, 2012 at 6:30pm

Ralph, so much digital snake oil out there that will cure cancer, crush your competition and get the prom queen to go out with you.  I take about 3-4 calls every day from vendors trying to sell us some sort of digital advertising personally, I'm sure larger dealerships and dealer groups take far more than that.  Many dealership decision makers can't even spell SEO let alone tell you what it is, so they revert to what they know... ROI.

 

I prefer free trials, if the product or service is even half as good as promised there will be no doubt in my mind that we absolutely must have it.  After all, when our customers say the price is too high we let them take it for a test drive, maybe even an extended test drive over night or for the weekend.  My department spends far more in a month that most people would dream of spending on a car so I think a little test drive is a fair request.  Let me push the buttons, try it out on the (information) highway and enjoy the new-lead smell.

 

I promise that if you ever buy a car from me I won't just show you a video and spec sheet and expect you to buy it at MSRP, I simply ask the same of my vendors.  Oh, and I know somebody is going to use the every popular "it takes 2-3 months before you see results!" cop-out, that's BS and all of us here know that.  Give me some time be it a couple of weeks or a full month, just give me some time to see if it's a good fit.  You stand to be rewarded with a long standing and potentially lucrative relationship.

Comment by Ralph Paglia on November 19, 2012 at 2:56pm

At the risk of sounding like a heretic, I am going to state that (in my opinion) most of the "Show me the ROI" objections we hear from various people in the automotive retail ecosystem, dealers, GM's, managers and suppliers included, is the equivalent of a customer shopping for a car when he/she says "Your price is too high..." We have simply not yet conveyed a sense and perception of value.  As many of the comments suggest, how often did we hear dealers ask for "Show me the ROI" when the newspaper advertising rep, radio station rep, TV salesperson or outdoor advertising people came by? The reason being that the dealer or decision makers had been previously sold on the value of such media to their dealership's business objectives. 

I always get a kick out of the old newspaper days when we would have a crappy weekend, the GM would not say "Newspaper advertising sucks" he/she would say "Our newspaper ad sucked".  In other words, with traditional media we never blamed the media, we were far more likely to blame the message... It is that way with digital marketing... If your digital marketing is a disaster, do not blame the medium, we all know that is where the customers go to decide on what and where to buy... Blame your own lousy execution!

Comment by Alexander Lau on November 19, 2012 at 1:31pm

I stand corrected, Google+ is accounted for in the screenshot that I've included. Thanks for the post, Ralph. Tom, I have been pushing this 3rd party group for a competitor measurement mechanism. It might help drive the need for Social Media management and monitoring even more so. Example: Dealership John Doe, here is what your competitors are doing and their "social signals" and here are yours or the lack of yours and why they are beating you in a number of areas. I'm a firm believer quantifying this stuff always helps. Some sort of benchmarking data.

Comment by Tom Gorham on November 19, 2012 at 1:25pm

Ralph, this is why you are the king of digital marketing.  "It is not what ADM Professional Community Members want to hear, but we need to be aware of the perception challenges we still face and take every opportunity to overcome them..."

This is so true and sometimes we who are active in digital marketing forget that there are detractors out there who don't see the value in what we do.

I was reading the comments below and thinking, "Yeah!"  If a dealer does Social Media for no other reason than to stay in front of their customers, then it's worth it.  But they keep asking for ROI as if they ever had an ROI for their newspaper advertising. 

I understand the need for measuring "three times before cutting".  But some things just go without saying.  It's called customer service and relationship building that results in referrals and reputation. 

Comment by Alexander Lau on November 19, 2012 at 1:08pm

Dan, absolutely, agreed.

If the conversions and goals aren't set up correctly within a 3rd party analytics tool, forget it. For some, it can be a huge effort in itself. I never assume the web capabilities of a dealership. If their CMS (if they have one) limits landing page production (an obvious part of setting up a conversion process), then what?

The good news, I suppose the conversion processes aren't going to change and the available technology used to measure social media conversions will become more affordable, it usually does. The technology that I have installed is by no means cheap. Powerful yes; cheap no. I haven't come across an open source social media conversion tool as of yet, maybe there is one out of there or this could be manually configured with another tool. There's probably a method of doing it via Social Media managment tools like WildFire, but I could be wrong.

Comment by Dan Fontaine on November 19, 2012 at 12:51pm

Alexander, I think that software can certainly make tracking ROI of Social more manageable. I am all for it. The problems may occur when dealerships are not taking advantage of analytics or third party software to measure what is going on on the social front to send up the line to management when asked. Although it seems silly, getting a dealership that is tethered to the old way to spend one element of a social strategy is tough, getting them to spend more on a solution that tracks it all can be even tougher. I think it can be done... It just requires understanding of what they expectations are and meeting them as well some patience. 

Comment by Alexander Lau on November 19, 2012 at 12:24pm

Dan, I agree with most of your assessment (especially convincing old school dealerships, some minds do not bend with the times) but in terms of Social measurement, I disagree. There are systems out there that'll give you a better indication of how your social marketing drives conversions (*posted an image below). They just need to be properly implemented and that's not always an easy process as a lot of dealerships simply ignore the need or fail to understand how to deploy the capture process. It's a matter of convincing the decison makers that social kills a bunch of birds with one stone and I agree engagement is part of the tactic.

Comment by Dan Fontaine on November 19, 2012 at 12:13pm

Tough to rationalize and truly document the ROI of Social for a fair share of old school dealerships and management types. Funny thing is that is very much tough to accurately measure the ROI of old school mediums either and they never seemed to have an issue with that. 

I have been using the Likeable Media metaphor when explaining the challenges faced while trying to explain the value of a social initiative; " Social is like the telephone. You can't really calculate the ROI of your telephone system. That said, I think it is safe to say that both your business and your clients are much better served having used it." I drop that statement and managers usually kind of have an 'a-ha!' moment or at minimum begin to understand it.

Throw in a dash of, "look at it as a retention mechanism similar to our newsletter to engage our clients in between times they would normally be visiting us for service... " and I can usually start to make a dent against the " swimming against the tide " that I can some times run into.  Even all that said, it is still really tough. Great piece and summary Ralph! Thanks!

Comment by Alexander Lau on November 19, 2012 at 12:10pm

It's absolutely true. I hate to say it, but most dealers barely take advantage of the most basic of digital marketing techniques, let alone creating an automated marketing processes (E-mail blasts configured and controlled via a CRM). It's no secret, it's all about driving leads and quantifying conversions. Dealer conversion techniques, widely vary. I'm sure there are a few that that do it better than most. I posted the image below in a previous post made by JD Rucker. Since Social Signals account for 10%+ of SEO, most SEO CRM's include Social Signal measurement. Dealerships should be paying closer attention to Social not only for SEO purposes but also for measuring the rate in which they convert customers from their various networks.

There's no data populated in this area, but you can see where Social Signals are accounted for and Conversions are measured. Also, our tool doesn't yet account for Google+ and Pinterest, but will. Will be fantastic for the automotive retail industry.

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