How the Automotive World Fell Behind on PPC

By Tyson Madliger Automotive PPC, Dealer Tips, General, Uncategorized Comments Off on How the Automotive World Fell Behind on PPC

If you look back a couple of years, ours was the industry to catch. Many vendors really mastered what Google Adwords could deliver to dealers, building or integrating technology that allowed for an industry within an industry. In fact, 10 of the 28 Google premier SMB partners are automotive-specific. That was two years ago. Today, we’ve fallen behind as an industry.

To understand how this happened, we have to look at two things: what works for dealers and what sells more easily for vendors. All of this can be singularly attributed to a lack of innovation from most of the major players, but that’s not a real answer. They’re trying to innovate. Unfortunately, the innovations are geared more towards glamour and glitz rather than effectiveness and ROI. It’s like The Wolf of Wall Street. A strong pitch doesn’t mean that the products are any good.

First, let’s look at what works.

Effective PPC Campaigns for Dealers

The automotive PPC world is in a constant state of flux because of changes in the way people use the internet as well as changes in the way that Google and Bing deliver ads to them. Keeping up is challenging for Google even with their army of developers. For automotive PPC companies to keep up with Google, they have to be able to look ahead and follow where the trends are pointing, not just where they are right now.

Here are some of the components of an effective PPC campaign and strategy:

  • Focus on Keywords that Make Sense – It’s not just about plugging in a list of 10,000 keywords. It’s about picking out the keywords that make the most sense based upon budget, demographics, inventory, and current specials.
  • Ads that Compel the Click and Match the Message on the Other End – A message like “Come see our inventory and specials online” is basically a non-message. Get exciting. Be informative. Say something that makes sense to them based upon their search, then take them to a landing page that delivers the whole message.
  • Funnel Awareness – If someone is doing research by typing in “Toyota Camry Reviews”, you shouldn’t send them to an inventory listing. They may are may not be ready to buy soon, but make sure they’re getting what they need in order to make that decision.
  • Appropriate Use of the Fancy Stuff – There’s nothing wrong with things like retargeting, banner ads, or geo-fencing, but it has to make sense to the budget and the dealership. If you’re in a small- to medium-sized market with a $3000 budget, you shouldn’t be throwing your money away on the fancy stuff. It’s just additional cost for fewer clicks and lowered sales.

Now, let’s look at what’s selling for vendors today.

Easy Selling Points for Vendors

One would think that effectiveness and the ability to sell the product would be better aligned. They’re not. In fact, some components of what sells is the opposite of what works.

  • Co-op Dollars – On this particular list, it’s the only thing that truly makes sense. Co-op dollars trump effectiveness.
  • Automation – There’s a need for certain levels of automation in PPC, but all-too-often bigger companies rely on automation for just about everything in order to make their product scalable. As a result, they’ve turned this automation into a selling point.
  • Frequent Bid Adjustment – It’s easy to get swayed with words like “algorithm” and “real-time” when it comes to bid adjustments. There’s a place for it, of course, but keep in mind that these changes are making a difference of literally pennies per day. If an algorithm saves you a dollar per day on a $10,000 per month budget, that would be high.
  • Tracked Landing Pages – To solve the deficiencies PPC companies have with building landing pages on a diverse range of website platforms, many have adopted offsite or subdomain landing pages. They say it’s for the sake of tracking, but here’s the thing: Google analytics can track your onsite landing pages with pretty high precision. It’s not for the accuracy. They’re doing it because it’s easier. However, it can sure sound great in a pitch.
  • Great Reporting – The importance of reporting shouldn’t be understated, but on the other hand the incredibly complex dashboard and dozens of pages of reports are used as a selling point and to confuse dealers. It’s pretty simple to track PPC. How many clicks, how much did it cost, what did those visitors do on the site, and how did it all affect sales. That’s pretty much all you really need to know. If you need more, Google has much better tracking and reporting tools than most PPC vendors. They just don’t want you to see those numbers.
  • All the Fancy Stuff Up Front – Using the example above, a $3000 budget leaves no room for the fancy stuff. However, the value proposition of a PPC company is tied into the fancy products. They often force dealers to use them even when they know the results are worse than if they went for straight PPC with their budgets. If a dealership has a higher budget, the fancy stuff often makes sense.

As you can see, some of the things that dealers are looking for are based upon what vendors are telling them. Let’s look at the results of what this has been yielding.

Diminishing Returns

PPC Trends

More people are searching, especially on mobile devices. More people are buying cars. These two factors would make one believe that the results should be better today than they were a year ago. In general, they’re not.

Above are some actual campaign statistics from a major automotive PPC partner. As you can see, the costs are staying around the same for the last year but the number of clicks are going down regularly. Cost per click is going up. What’s the cause?

The biggest problem in today’s automotive PPC is stagnancy. The needs are changing. The programs are not.

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