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For Car Dealers, the Internet is no "Field of Dreams"

 

"If you build it, they will come."

So cliche.

So not true.

Dean Evans (currently Chief Marketing Officer at Dealer.com) and I haven't seen each other for years.  Being Digiliteratti, we are "friends" on LinkedIn.  At the Wards + AutoByTel conference in Tampa last month, Dean said the point I wanted to make in this newsletter so well, I just thought I would quote it here:

"[Dealers] real concern should be whether their online efforts drive traffic that, in turn, is converted into dealership sales."

Not impressions, not clicks, not unique website visits, not form submissions, not Internet inspired phone calls.

Just vehicle sales and gross profits.

Positive ROI that would warm my Deloitte & Touche trained heart.

I call that first batch of activity based results (i.e. impressions), "Leap-Of-Faith" results.  Tech vendors convince dealers to spend their money on this stuff to generate these activity based results and leave the true ROI to vague concepts such as "well we got them there, now it is your job to sell."

Wrong.

It is that kind of thinking that bankrupted the entire Dotcom era of startups.  Eyeballs are not cash that can be spent.

It is that kind of thinking that makes the Internet Department the perennial whipping post in many dealerships.   3,000 unique visitors to the website!  60 leads + another 240 purchased from 3rd parties + our OEM!  Timely price quotes + auto-responses sent to them all! 

Ahhh...and then the proverbial sound of the other shoe dropping... 6 and 5 showroom visits from those lead sources, respectively... 5 cars sold total.  Whew... plus 2 staff, an Internet Manager, a CRM program, website, lead fees and paid search campaigns to generate it all.

My CPA heart is not so warm any more with that ROI.

Yet clearly it can be done, since the best Internet departments in the country are responsible for sourcing half of the store's sales and do so without cannibalizing existing volume.  Basically, if you are not getting your "fair share" online, they are taking it from you.  Those cars are being sold by someone.

Dean was quoting on an appropriate cautionary note about paid search spending.  My friends Jamie Adams and Seth Winterer over at Reach Local Auto have been preaching this for as long as I have known them.  "Coincidentally" they have the most sophisticated tools I've seen to help make sure a dealer is buying the right amount (positive ROI) of search and Pay-Per-Click and not doing exactly what the seminar was cautioning against.

But that is another topic.

Dean's quote applies to everything your dealership does - whether online or offline, whether maketing, advertising, social networking, blogging, CRM, BDC, buying websites, SEM, SEO, PPC, hiring and training staff or my company's car dealership shopping cart software for vehicles and F+I.

Just something to think about as you go about your day and field calls from vendors pitching their wares.  Ask yourself, "Are they pitching activity based results and Leap-Of-Faith notions that the activity they generate will result in real ROI?"

Or do they have reference quotes like this:

"This works.  Consumers really like it and we are selling more cars at good grosses by having Ai-Dealer's shopping cart software for vehicles and F+I added onto our website."

David Thomas, Dealer

Subaru of Plano

Subaru of Dallas

 

A bit of a shameless plug, but hopefully you get the idea and can apply it to prioritize the things you can spend your money and time on.

If you think I am right on or totally whacked, please share your thoughts in the Ai-Dealer forum and this topic post in particular.