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Automotive News Interviews Richard Bustillo: "Dealers Get In Your Facebook"

Automotive Dealers Get in your Facebook

Stores post ads directly on site's news feeds

Richard Bustillo of Rick Case Honda says Facebook is taking advantage of new opportunities to reach customers by putting ads directly in news feeds.

 --Automotive News  

Thought Leadership

Richard Bustillo, general manager of Rick Case Honda in Davie, Fla., believes Facebook has finally cracked the code to help dealerships sell vehicles and service.

Marketers have long viewed Facebook as an online cocktail party -- fine for socializing but weak for selling cars.

Now that's changing. Rick Case Honda and other dealerships are starting to take advantage of Facebook's huge potential to reach customers on the users' digital home turf, by putting ads directly into their customers' news feeds.

Technical improvements introduced in September allow dealerships to take their customer lists -- with just names and e-mail addresses -- and find those people on Facebook. The "custom audience" feature allows dealerships to push ads directly to Facebook users' news feeds, the must-see center column of the home page that consists of a constantly updated list of posts by a user's Facebook friends.

Facebook users are more likely to look at news-feed ads than those in the more common ad location, the right side of a Facebook page, the social media giant says.

"Facebook is starting to understand what we need to sell cars," Bustillo said.

In June at Rick Case Honda, an employee-pricing-for-all promotion on Facebook contributed to a strong month -- 615 new vehicles sold -- the most of any Honda store nationally for the month, Bustillo said.

Facebook played a key role in the campaign's success, he said. The store took its customer list with thousands of names and e-mail addresses and identified who were Facebook users. It then delivered to their news feeds the employee-pricing offer, Bustillo said.

Facebook also has improved the ability of dealerships and the factories to put promotional videos in front of car shoppers, Bustillo said. Facebook users are three to four times more likely to click on a video than a static ad, the company has found.

Rick Case Honda in 2012 has sold 4,238 new Hondas through Oct. 23, the third most of any Honda store nationally, the dealership said.

The knock on Facebook, from a marketer's standpoint, is that although the huge social media site has been useful for automakers to promote brand awareness, it has been nearly irrelevant in the shopping process.

As recently as May, Dataium, a consulting company that monitors online vehicle shopping behavior, found that of 20 million visitors to dealership Web sites, just 120 arrived there directly from a Facebook link. Of that microscopic number, only a handful left contact information to become sales leads, Dataium found.

On the other hand, automakers have been building huge banks of friends and sending them soft sells, such as sponsored stories, that talk about topics such as the environment without a direct pitch for vehicle sales. Jeep, for instance, has more than 2 million Facebook fans.

Viral Advantages

In an interview last week, Doug Frisbie, Facebook's head of automotive global marketing, said Facebook attained the technical capability to put ads on Facebook users' news feeds in late January.

 

Ads placed there are more than eight times more likely than ads on the right side of a user's Facebook page to prompt a reader to comment on the item or actively "like" it, Frisbie said. Facebook refers to a user's interaction with an ad or item as "engagement." And advertisers are seeing 10 times greater recall from news-feed ads than from static ads, he said.

Bustillo said he likes the news-feed ads because the dealership pays for them only when Facebook users click on them. That's similar to Google paid search.

The ads also have the potential to go viral, Bustillo said. Each Facebook user has on average 130 friends, Facebook said. If a Facebook user shares an ad with friends, it has a multiplier effect of reaching people without additional cost to the dealership. The dealership pays for an ad only when the original audience clicks on it, Bustillo said.

Facebook declined to say how many dealerships or automakers have used the new capabilities to find their customers on Facebook or deliver ads to news feeds.

The company is watching for backlash from its users, accustomed to conversing relatively free of advertising, to having ads placed in their news feeds.

"We are carefully monitoring user engagement and sentiment," Facebook COO Sheryl Sandberg said in an earnings call last week. "We look at how users are engaging on our platform, and as we've increased the number of ads and news feed we've been careful -- carefully monitoring that engagement."

Joe Castle, dealer principal of Castle Chevrolet in suburban Chicago, has matched about 8,000 people on his 14,000-person customer list with their Facebook addresses. In the past three weeks, he sent to their Facebook news feeds an offer for them to buy one oil change and get one free.

In the first two weeks, the campaign, which cost him about $500, generated about $12,000 in oil changes and other maintenance, Castle said. Castle Chevrolet pays Facebook about 60 cents when a customer targeted on Facebook clicks on the offer, he said. The store sold about 1,200 new vehicles in 2011.

"Facebook has really dialed it in," said Castle, who also is founder of Socialdealer, a social media and reputation-management company for dealers.

Facebook's features to target shoppers are evolving, Frisbie said. Within a month, Facebook expects to pilot a program with R.L. Polk & Co. that will allow automakers and dealerships to use Polk's huge database of owners to identify sales prospects, he said.

"We're talking about getting the right message at the right time in front of in-market shoppers," Frisbie said.

Target Accord

Rick Case Honda expects to make heavy use of ads and video on Facebook news feeds next year to promote the redesigned 2013 Honda Accord sedan, Bustillo said.

The store is waiting to launch the campaign until early next year, though the 2013s are available now, to leave time for the store to clear 2012 models still in stock, he said.

When the campaign is rolled out, Bustillo said, he intends to shoot videos to potential customers through Facebook extolling the features of the sedan. Moreover, with the help of campaign consultant Tier10Marketing.com, the store will target Accord customers with equity in their cars so he can offer them a new Accord for the same or lower monthly payments, Bustillo said.  The targeting capability of Facebook makes it an economical media buy, he said.

Rick Case Honda spends about 20 percent of a $250,000 monthly advertising budget on digital advertising. Bustillo said he gets his best return on investment on the $2,000 a month that he spends on Facebook ads.

"I'm chomping at the bit to get started," Bustillo said of the upcoming Accord campaign.

You can reach David Barkholz at dbarkholz@crain.com. -- Follow David on Twitter and 


Read more: http://www.autonews.com/article/20121029/RETAIL07/310299951#ixzz2BS...

Views: 729

Tags: Advertising, Automotive News, Car Dealer, Facebook, Get In Your Facebook, Interview, Marketing, Richard Bustillo, Social Media

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Comment by Alexander Lau on November 15, 2012 at 11:18am

Dealers, get in your Google!

https://www.google.com/cars

Example of the inventory search results on Google itself: https://www.google.com/search?q=morgan+hill+ford+store&oq=morga...

 

Cars.com and the like ain't gonna like.

Comment by Alexander Lau on November 12, 2012 at 5:05am

I think there's one important thing to consider in this entire CRM dB to Facebook integration. Dealerships had better maintain their CRM dB's well. Meaning, they had better have new customers segmented from used customers, make / model, etc. It's not going to benefit anyone, if they're unable to sort their lists in order to do exact matches, through Facebook's Power Editor. Companies cannot just dump a giant list of clients and expect it to do wonders, it has to have been managed properly in the first place.

Comment by Ralph Paglia on November 9, 2012 at 11:17am
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Comment by Ralph Paglia on November 9, 2012 at 10:54am

Marsh, I just posted an article from AdAge about the new capability: http://www.automotivedigitalmarketing.com/profiles/blogs/facebook-a...

Comment by Ralph Paglia on November 9, 2012 at 10:25am

Marsh, I was in a 2 hour meeting with a couple of Facebook exec's responsible for the Automotive Vertical yesterday and we discussed this feature in detail. One of the best analogies I can use to describe the Facebook profile match back, is that it works a lot like when you first join Facebook and you download your address book... The system looks at the email addresses you have and informs you that X number of records in your email address book out of the Y number you submitted have matching profiles... Do you want to add them as friends? After your initial sign-up with Facebook, there are restrictions put on the function to deter spammers.  So, what you will do is through your Facebook PAID ADVERTISING ACCOUNT, you will be submitting a CSV or other equally ubiquitous file format of an export from your DMS or CRM application.  Facebook then matches your records up with member profiles and creates a group with which you can then target your advertising.

My recommendation would be to have an initial campaign to encourage your DMS database of customers who have spent money at the dealership to become "Fans" by "Liking" your dealership's Facebook Page.  Then, you have filtered down from a larger, to a smaller list, and now you know which customers are likely to respond to offers, the ones who liked your Facebook Page.  Then you run ad campaigns targeting your Facebook Page Fans with exclusive offers only available to them. 

I have done this with over 50 dealerships and it works... Service Offers, event marketing, new model VIP intros, accessories and Extended Service Contracts are all highly effective promotions with this type of strategy.  We have had some fair results on the vehicle sales side of things, but the response to service offers overwhelms and dwarfs what you get from a sales pitch.  Hey, its all good, but when you get 300 to 500 people taking advantage of a service offer, it is hard to get excited about selling a couple of cars for the same budget investment.

In the Rock Case Honda example, they were ultra focused on moving new vehicles... All their integrated marketing worked together for success, including what they did with Facebook, but what you should realize is that over 150 of their employees used their personal Facebook accounts to push the advertising creative to their own networks of friends, neighbors and family.  From what I saw, the actions on the part of the employees magnified the results yielded from a $2,000 monthly Facebook advertising budget.

Comment by Alexander Lau on November 6, 2012 at 10:15am

BTW, and sorry to double post, your infographic reminds me of the R.A.C.E digital marketing strategy planning framework = Reach, Act, Convert and Engage.

Comment by Alexander Lau on November 6, 2012 at 9:37am

Previously, it was way too freakin' generic, which probably suited Facebook just fine in that they were making more money, but at the same time wasting the efforts of their advertising customers.

It was a matter of time before they integrated this into their system. Basically, it's a matching tool, which they have always had (a weak predecessor), but previously was not built on a CRM integration level (importation of CRM dB's for use in customer matching). Having to match up customers or potential customer manually was a painstaking experience. I'll be interested in seeing how dealerships cope with this new requirement and what CRM's actively support them.

Custom audience targeted ads will be much more relevant than ads just targeted to a business fan’s or some biographical demographic. They can reach people who a business is sure purchased its products before, or that haven’t thanks to exclusionary targeting. Yes, businesses could just email these existing customers for free. However, Facebook can help them hone in on certain demographic segments of their customers by overlaying additional targeting parameters, and reach them vividly through the news feed instead of their dry inbox.

A car company with email addresses of its customers could target “buy a new SUV” ads to people who bought an SUV 5+ years ago, while targeting “Find nearby charging stations” to those who recently bought an electric vehicle.

IMO, it's a ploy by Facebook to sell more ads through customization techniques, which is smarter than what they were doing. It should have better results for dealerships, especially since most of them have a CRM of some type that exports out CSV and/or XML for importation into the Facebook Power Editor.

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