Paid search typically consumes the largest part of a dealer’s digital advertising budget, and from my experience there are many dealers who are wasting a large portion of this spend. Most of these dealers have no idea how to inspect the quality of these campaigns, and there are many reasons this waste is occurring. For instance, their keyword lists are outdated, computer generated, aren’t updated for new models, and peppered with too many short-tail broad match search terms. However, one of the biggest contributors to dealers overpaying on paid search is related to an overly large geographic target. Of course, the dealer only pays when someone clicks on the ad, but why take the chance with errant matched-traffic from areas unlikely to convert? Too often, agencies or dealers are looking at a map and taking a “shotgun approach” and trying to use paid search to conquest a massive amount of territory. If you’ve ever audited these types of campaigns, you know these dealers pay dearly for type of approach. Can it be done? Sure, if you’re willing to spend $1,000+ per lead, you can take that approach. However, I’m offering a more targeted, “rifle” approach, to instead cast your line where the fish are, instead of across the entire lake (ok, no more metaphors, I promise!). By using retail new vehicle sold-data, dealers can better target their paid search campaigns.
I spent the majority of my automotive career with Dominion Enterprises, and one of the gems in that business is a company called Cross-Sell (www.cross-sell.com). Cross-Sell, based in Lexington, Kentucky, markets registration data to dealers and they deliver it through a very easy-to-use online tool. By using their powerful Cross-Sell Interactive (CSI), I’m able to help dealers identify the top zip codes in their market area (and bordering their competitors) for conquesting new car sales through paid search. Now of course there are other companies offering sold-data for this purpose, but the CSI heat maps allow you to hover over and target zip codes in a short amount of time.
Here is a sample heat map I used to help a Ford dealer determine the best local zip codes for targeting paid search (by the way, the same approach can be used for paid social).
By looking at where all of the new Ford sales occurred over the last 90 days, and by factoring in the other Ford dealers in the area, I helped this dealer better target areas for conquesting new sales, or for fixed ops campaigns.
The lesson here is to hold your agencies or internal teams accountable for how they’re spending your paid search dollars. In addition to inspecting the campaigns for ROAS at a keyword level, also find out how the targeted geographic boundary was created. Take control of your own website dashboard using Google Analytics, and you will be money ahead!
If you’re attending Digital Dealer 24 in Orlando Florida, April 10-12, I’ll be presenting a session on how to grow your used vehicle operations, please join me! If you are an automotive retailer, I would love to help you with a complimentary digital marketing audit, including analyzing your paid search spending. I can help you improve your return on ad spend and gain more transparency with your digital marketing investments. Details here: generationsdigital.com
Author: George Nenni
With three decades of IT and automotive experience, George Nenni educates the automotive industry about emerging technology by writing, speaking and sharing his vision for how dealers can maintain a competitive edge. George has spent countless hours over his automotive career with dealers training them in-store on best practices, software applications, and with adoption of new technologies. He not only trains on software implementation and usage, but also consistency in platform-level process and associated accountability. Today George is principal consultant with Generations Digital, providing digital marketing consulting to automotive retailers. He also is an adviser to T3, providing consulting to automotive vendors.