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Defining Your Competitors: OEM Mandated Search Marketing vs Dealership Focus

Let's face it. Websites are becoming a commodity in the automotive world. Most quality website vendors are putting out solutions that are good enough to work well. Few are coming up with innovations that can differentiate them, and those differences are relatively small in the whole scheme of things. The difference between a good and a great website is minimal when translating it to increased sales.

 

The reason for this is that consumers are becoming increasingly impatient when in car shopping mode. It's not that they don't spend as much time doing it as before. It's that they are doing most of their research on websites other than a dealer's site and only visiting when they're ready to look at live vehicles. At that point, they're going straight to inventory or specials and deciding from there whether to consider doing business with a dealership or not. If you have the right inventory items that they're considering, a bad website isn't going to keep them from contacting you. Conversely, if you don't have the vehicles they're seeking, an amazing website isn't going to coax them into doing business with you.

 

Websites are websites. Some are better than others and have strong conversion tools, but the real arena through which dealers can move the needle is in the quality of their digital marketing efforts. One of those efforts, search engine marketing, is arguably the greatest opportunity for advancement because it translates into more visitors, more leads, and potentially more sales when done right.

 

The biggest challenge that dealers with OEM-mandated search marketing products face is in defining competition. From the OEM's perspective, a Ford dealer's competition is the Chevy dealer down the block and the Honda dealer around the corner. They want search exposure that can take sales from the other brands. This is a good and noble cause, but unfortunately it's not the most practical target for individual dealers and dealer groups.

 

From the perspective of the Ford dealership itself, their primary competition isn't the Chevy dealer and the Honda dealer but rather the other Ford dealers in the area. It's how they're graded; we all see reports every month that tell us how we're doing against other dealerships in the area that sell the same brands. It is for this reason that OEM-mandated search marketing, as affordable as it is, simply isn't the best way to improve sales. At the dealership level, the lowest hanging fruit for increased business is by taking sales from the real competition, namely the other Ford store a few miles away.

 

As mentioned, there is one advantage to the OEM-mandated search marketing: it's cheaper. It's often paid for in whole or in part and can act as a check box on your marketing. "Yep, we're doing SEO and PPC. The OEM is taking care of that for us."

 

Unfortunately, that's really the only advantage. It's designed in most cases to keep every dealership inside their own little box. Reaching outside of the direct market area is a no-no for companies that work for the OEMs. In fact, they're goal is to keep the boxes neat and tidy.

 

When the search marketing is focused at the dealership level, it's a completely different strategy. The goals have changed; it's not that a Ford dealer doesn't want to take market share from a Chevy dealer, but that's a heck of a lot harder than taking a deal from the Ford dealer down the road. Let's say there's a dealer in a small town a few miles from you. They're the only Ford dealer in that town. Everyone in town knows them. When they want to do business with that dealership, they'll search for the dealership by name.

 

Consumers who search for the dealership by city are looking for an alternative. They know about Bob Ricky's Toyota in the heart of town. If they do a search for "Somewhereville Toyota Dealers" or "Toyota Dealers Near Somewhereville", you'll want your dealership to pop up. People that do searches like that are trying to find someone else from which to buy their Toyota. If they wanted to buy from Bob Ricky's Toyota, they would have searched for "Bob Ricky's Toyota". They didn't. They want someone else. They want you. If you're ranked for that search, there's a good chance they'll check out your website to see if they can do business with you instead of Bob Ricky.

 

Unfortunately, the OEM-mandated search marketing products aren't designed to help in this regard. In many ways, they're designed to prevent this from happening.

 

If your goal is to beat the competition, your competition, then don't look to the OEM's search marketing company. Don't just check off the search marketing box and call it a day. Explore your options and see if there's a way to improve your search marketing to focus on helping your dealership the best way you can, by being aggressive and getting your dealership in as many relevant searches as possible.

Views: 769

Tags: Dealership, OEM, SEO, Search Engine, Search Engine Advertising, Vendors, car company, search Marketing

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Comment by Brian Pasch on December 8, 2012 at 6:35am

Joe, you bring up the practical issues that digital marketing strategies face all the time.  Dealers feel comfortable spending $15-$30K a month on traditional marketing but put the brakes on digital budgets when they get over $5,000 a month.  

A the root of the problem is not that dealers only know what they know.  Frankly, there is an educational gap with dealership executives. Few people have been able to educate dealers to understand  how to measure the ROI of their marketing investments. This gap in education is the greatest in digital marketing strategy.

For example, mobile search marketing campaigns can deliver outstanding cost per lead benefits and the majority of those leads are calls.  Calls are so much better than an email lead from a website form.  Yet despite this fact, many dealers do not have a strong mobile paid search presence.  When a dealer sees that they can generate PHONE CALL leads for under $10 all day long via mobile, their eyes light up and dollars are allocated.  The educational gap gets closed and the dealer has a local competitive edge. 

The OEM paid search programs do get dealers to stick their toe in the water and they help to defend their territory for sure.  However, participation does not always develop an understanding of how it is working. If it did, the majority of dealers would be increasing their digital spending regardless if the funds were cover by CO-OP.

So the need for continued education continues.  I am so pleased to see many dealers and General Managers get excited when I do show them how to measure the ROI of their marketing investments.  

In fact, I'm out in Michigan this week and the dealer group I'm working with has decided to significantly increase their digital spend.  That only came after we looked at their website analytics and budgets carefully.   They will be using OEM programs as well as non-OEM program.

Dealers looking for the best strategies for 2013 should mark their calendars for the 2013 Digital Marketing Strategies Conference, February 5-7th in Orlando.   The best of the best will be presenting their strategies to help dealers sell more cars and increase profits.   The lineup include experts in SEO, SEM, Social, Merchandising, Mobile, CRM, Dealership Websites, Traditional Marketing, and more. 

So when the right education is provided dealers can take advantage of OEM programs but also enhance them with campaigns that are not covered by the OEM strategy.  JD is right to point out that OEM programs often don't cover conquest campaigns and used car campaigns that include other OEM brands.


So the lesson here is to understand what is covered by OEM packages and inspect that they are working.  Then add the missing pieces to create a comprehensive digital marketing strategy.  The remaining funds can be allocated to other marketing opportunities but the digital side must be maximized first.

Comment by Joe Webb on December 8, 2012 at 5:15am

While you're right on the money, JD, in the fact that your digital marketing efforts must be more dealer-focused than OEM-focused, recognize that small dealers are still on a budget.  Without co-op money and severely discounted rates for display, search, and PPC, we must recognize that many dealers wouldn't be willing to dedicate enough budget to do it right on their own (or with a third-party, non-OEM approved vendor).  What the OEMs do well is ensure their dealers are at least dipping their toes in the digital water with these severely discounted packages, even if it isn't the optimal digital strategy for the dealership.  I agree with you that many SEM/digital/SM companies are far better than those supported in the OEM-approved packages, but usually the OEM offers them at prices far lower (and more in line with a dealer's budget) than they could get otherwise.

Comment by Martin Logsdon on December 8, 2012 at 4:56am

Right on J.D.    Focus on 'your' ABC Ford and let Ford focus on Ford.

Comment by Joe Schwartz on December 8, 2012 at 4:52am

Excellent post.  Highlights the need for a strong local SEO strategy.  At the risk of sounding like a broken record, here is a proven local SEO strategy for pre-owned inventory: http://automotiveinternetsales.com/profiles/blogs/carclips-case-stu...

Comment by Tom Gorham on December 8, 2012 at 4:42am

Bravo JD!  The goals of the OEM and the dealer entertwine but are not the same thing, particularly in the case of marketing.  Wise advice!

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