Cobalts Breakfast of Champions Building an Online Marketing Strategy Dean Evans Vice President Field

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Cobalts Breakfast of Champions Building an
Online Marketing Strategy Dean EvansVice
President Field Marketing The Cobalt Group, Inc
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Breakfast of ChampionsWhy are you here?

• To Learn
• Why it is critical as a General Manager to modify
  your advertising spend to create additional,
  lower cost opportunities for your dealership
• Why it is critical as an Internet Director or
  manager to understand how to secure more
  advertising budget for Internet marketing
  activities
• Leverage Internet marketing areas to drive more
  vehicle sales from the industrys top dealers
• Discover ways to close more leads

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Breakfast of ChampionsTodays Topics

• Are You Off-Target? Your Customers are Online.
  Why isnt Your Advertising?
• Dramatic changes taking place in automotive
  advertising and marketing
• Implications for dealers
• Ingredients to a Successful Online Marketing
  Strategy
• Putting it All Together Lead Management that
  Drives Success

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Are You Off-Target?Your Customers Are Online.
Why Isnt Your Advertising?
Radio
Online Marketing
Television
Yellow Pages
Newspaper
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Consumers Spend More Time Online Than Just About
Anything Else..
Yet dealers spend advertising!

• Weekly Consumer Media Consumption
• Going Online, 14 hours
• Watching TV, 14 hours
• Listening to Radio, 5 hours
• Reading Books, 3 hours
• Reading Newspapers, 2 hours
• Reading Magazines, 1 hours

• Average Dealership Media Spend
• 33.0 Newspaper Yellow Pages
• 19.5 Television
• 17.7 Radio
• 10.0 Direct Response
• 9.9 Internet
• 9.9 Other

CPVR 457
Source Jupiter Research (January 2006), NADA
2006 Industry Analysis Division
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How Much are YOU Spending on Online Advertising?

• 21K Newspaper
• 12K TV
• 11K Radio

• 12K Direct mail / other
• 6K Online

Source IAB, NADA 2006 Industry Analysis
Division
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The Internet is the Starting-Point for Most
Vehicle Buyers

• 67 of Auto Buyers Research Online
• 89 use Search Engines for research
• 70 start at a Search Engine

JD Power 2005 Autoshopper.com Study JD Power
2005 Autoshopper.com Study Yahoo! Compete 2005
auto study
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You Need to Rethink Your Entire Advertising
Strategy
Internet Search
Dealer Website
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Internet Search Implications for Your Dealership
If youre NOT advertising on the Internet
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Breakfast of ChampionsTodays Topics

• Are You Off-Target? Your Customers are Online.
  Why isnt your Advertising?
• Ingredients to a Successful Online Marketing
  Strategy
• Creating the cornerstone of your marketing
  strategy
• Spend less, make more. An introduction to
  Internet search
• Creating opportunities through effective 3rd
  party lead sources
• Increasing customer retention and dealership
  profits through Owner Marketing
• Putting it All Together Lead Management that
  Drives Success

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How Does Your Advertising Strategy Compare to
Top-Performing Dealers?

• Todays Top Performers..
• Make the website the focal point of their
  advertising
• Align online advertising with print / radio / TV
• Continually tune their website for higher organic
  Internet search engine ranking
• Drive more leads through Internet search
  advertising
• Acquire valuable customers via high performing
  3rd-party leads
• Build long term, profitable relationships with
  existing customers via owner marketing

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Dealership WebsiteThe Cornerstone of your
Marketing Strategy

• Elements of a Top-Performing Website
• Every increasing visitor to customer action
  ratio
• Generates first page SEO placement / Flexible to
  handled paid search campaigns
• Integrates with your OEMs advertising and
  merchandizing
• Synchronizes your offline and online advertising
  fast!
• Is consumer-tested NOT what the dealer likes
  visually
• Answers FAST the consumers question, why
  should I buy from your dealership

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Breakfast of ChampionsTodays Topics

• Are You Off-Target? Your Customers are Online.
  Why isnt your Advertising?
• Ingredients to a Successful Online Marketing
  Strategy
• Creating the cornerstone of your marketing
  strategy
• Spend less, make more. An introduction to
  Internet search
• Creating opportunities through effective 3rd
  party lead sources
• Increasing customer retention and dealership
  profits through Owner Marketing
• Putting it All Together Lead Management that
  Drives Success

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Internet Search is Like Buying a Home Its About
Location, Location, Location
Organic Search

• Original Search Page
• Algorithmic

Paid Search

• 12 14 Links
• Advertising
• Pay Per Click

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Top Things to Know About Organic Search (a.k.a.
search engine optimization (SEO), natural free
listings)

• All search engines crawl the web to establish
  organic rankings of websites based on their
  content and links
• Page one, above the fold is the best real
  estate
• Organic search is like PR (not advertising)
  influence, not control
• Organic Search is Step 1 in a smart search
  strategy

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Top Things to Know About Paid Search a.k.a.
pay-per-click, search engine marketing (SEM)
paid placement

• Paid search is advertising, and its how search
  engines make money
• Paid search success is based on
• Keywords / bidding strategy
• Ad copy and campaign quality
• Dealer website quality / ability to convert
  traffic into leads
• Google, Yahoo!, MSNs networks account for 95
  of all Internet search traffic (source CNN /
  Money.com 5/06)

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Smart Dealers Already Profiting from Internet
Search
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The Magic of Search

• Key Success Factors
• Integrate with your overall ad budget
• Best leverage of your spending
• Organic paid search delivers best results
• Integrate with conversion-oriented website
• Work with a trusted provider
• Its too complex to do it yourself

• Key Benefits
• Measurable ROI for Search advertising
• Its where your customers are..
• Its targeted you connect with
• The right buyers
• The right ads offers
• The right time

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Breakfast of ChampionsTodays Topics

• Are You Off-Target? Your Customers are Online.
  Why isnt your Advertising?
• Ingredients to a Successful Online Marketing
  Strategy
• Creating the cornerstone of your marketing
  strategy
• Spend less, make more. An introduction to
  Internet search
• Creating opportunities through effective
  3rd-party lead sources
• Increasing customer retention and dealership
  profits through Owner Marketing
• Putting it All Together Lead Management that
  Drives Success

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Search and 3rd Party Leads

• While Internet search is exploding, the
  proportion of consumers visiting 3rd-party sites
  is actually increasing
• Dont get caught up in the you can drive all
  your customers to your site mentality.
• Nationally we see lead to close rates decline on
  dealer site leads when search campaigns are
  started
• Smartest Internet lead strategy includes a mix of
  
• Internet search marketing
• 3rd party leads
• OEM leads

Source Wards Dealer Business, April 2002-2006.
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3rd Party Leads and Classified Ad An Efficient
and Effective Lead Source

• New Car
• Aggregators today are not all alike. Some
  specialize in selling other specialize in helping
  you sell more vehicles
• Can fine tune your sales DMA alignment to source
  the best customer for your businessand do it as
  often as you like to test and retest.
• Used Car
• Know that there are both subscription based and
  pay for performance models. Know your cost per
  customer action
• Video, professional photos, pricing
  data/knowledge and copy expertise are needed
  today to top performing ad units

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3rd party sites are becoming more specialized 20
in1999 250 in 2007
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Breakfast of ChampionsTodays Topics

• Are You Off-Target? Your Customers are Online.
  Why isnt your Advertising?
• Ingredients to a Successful Online Marketing
  Strategy
• Creating the cornerstone of your marketing
  strategy
• Spend less, make more. An introduction to
  Internet search
• Creating opportunities through effective
  3rd-party lead sources
• Increasing customer retention and dealership
  profits through Owner Marketing
• Putting it All Together Lead Management that
  Drives Success

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Your Customers Dont Need to See you as
Frequently
Are you letting them forget you?
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Owner Marketing Success Story Dave Gill Pontiac
GMC

• Challenges
• Improve customer retention
• Increase service revenue
• Drive vehicle sales

• Results
• Proactive, targeted customer campaigns to match
  service sales business needs
• 6x increase in sales to customers in the email
  database
• 40 of repair orders driven by Ownership
  marketing provider
• 81 of CSI/SSI survey responses completed within
  72 hours

OwnerMarketing Solution
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Ensures you Communicate to Your Customers at the
Right Time with the Right Message
Dealership
Consumer
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Owner Marketing Takeaways

• Most effective direct mail is really Direct eMail
• Owner marketing is hard to do-it-yourself
• FTC / Compliance issues
• Hassles of collecting customer emails
• Find a trusted provider to do it for you
• Outsource marketing department
• Rapid response
• Success, expertise, agility

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Breakfast of ChampionsTodays Topics

• Are You Off-Target? Your Customers are Online.
  Why isnt your Advertising?
• Ingredients to a Successful Online Marketing
  Strategy
• Putting it all together Lead Management that
  Drives Success
• eBusiness Performance Study
• best practices of high-performing dealers
• People and process. Developing the skills for
  success

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Industry and Dealership eBusiness Performance
Study

• 1.1 million leads, matched to actual vehicle
  sales by R.L. Polk
• Average close rates, sales cycle, brand
  defection, cross-shopping

• Evaluate consumer perceptions of dealership lead
  handling

• Responsiveness, response times, quality of
  response

• Evaluate common best practices leading to higher
  conversions

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Dealership responsiveness to leads is improving
Quality is diminishing
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High Performers Provide Price

• Of the high performers interviewed
• 87 state they always answer the customers
  primary question(s)
• 77 provide price to customers without hesitation

• If I dont provide price, I am the highest
  price
• --Michael Waldrop, Coggin Honda

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Brand Defection is High
What is the primary reason you bought a vehicle
from another dealership?
Price (too high)
Dealership Response (poor)
Other Brand (customer decided to buy a different
brand new vehicle)
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Putting it all TogetherPeople Process
Developing the Skills for Success
Hi Customer Name,
Why Me? Why Make? Why Model? Hyundai
Sonata Dethrones Camry and Accord Thank you for
your request for additional information on the
exciting new 2006 Hyundai Sonata. My name is Tony
Bell, I am the Internet Director and it is my job
to ensure that you get all of the information you
need to make a good buying decision. We are
extremely pleased with the new 2006 Sonata as
well as all of our customers that already have a
new Sonata in their driveway. When you look at
the long list of standard features and read what
the experts have written about this car, you
will understand why Toyota and Honda Dealers are
worried. I, or one of my staff will be contacting
you to gather some additional information, answer
any questions, schedule a test drive or arrange a
home delivery. I have included in this email
links to various sources for reviews,
comparisons, and pricing guidelines. I have
included a link to Edmunds.com, they have a very
accurate pricing guide to follow. They publish a
TMV price to give the customer a figure that they
should expect to pay for a vehicle. Edmunds.com
is constantly surveying dealers as well as
customers to arrive at these prices. Please keep
in mind that every car deal is as unique as every
customer and you may qualify for additional
rebates and incentives. Reviews for the
Sonata Hyundai Sonata Dethrones Camry and
Accord http//www.autoblog.com/entry/123400089705
1169/ http//cars.about.com/od/hyundai/fr/bk_06so
nata.htm http//money.cnn.com/2005/08/03/Autos/c
arreviews/hyundai_sonata/ http//www.caranddriver
.com/article.asp?section_id3article_id9741
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Customers Have a Short Purchase Timeframe
273,886
Number of Closed Leads
42
204,486
32
103,130
63,455
16
10
0-30
31-60
61-90
91
Days to Close
Based on registration information supplied by
R.L. Polk Co. Sales/leases have been adjusted
for matching efficiency by a factor of 1.36,
which represents a 73 historical match rate
Elapsed time between the date of lead submission
and date of lead closure
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Research Summary and Implications
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eBusiness Performance StudyBest Practices of
High-Performing Dealers

• Similarities from the Top-Performing Dealerships
• Internet Director sits at the head management
  table and are becoming tomorrows (and todays)
  General Managers
• Treat Internet customers just like walk-ins,
  because most of them are today
• Make the website the focal point of their
  advertising strategy
• Synchronize Internet advertising with print /
  radio and TV advertising
• 3rd-party leads from top lead providers (used and
  new)
• Drive additional leads through Internet search
  marketing
• Continually optimize the dealership website for
  higher organic search engine placement

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eBusiness Performance StudyBest Practices of
High-Performing Dealers

• Similarities from the Top-Performing Dealerships
• Continually fine-tune their website for maximum
  visitor-to-customer action conversion
• Offer even in initial response emails price,
  alternative vehicles and timely initial responses
  to leads
• Utilize for email responses new ways to stand out
  from your competition Branding and Video for
  example on vehicle requested
• Enhance their follow-up processes with
  high-performance templates that are automated for
  increase sales person performance
• Invest in Internet training AAISP national
  convention

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Putting it all TogetherPeople Process
Communication Skills Training

• Three rules for success
• Respond first
• Answer their primary questions
• Do you have it?
• How much is it?
• Get them on the phone
• Phone scripts Price Quote, Vehicle
  Availability, Appointment Confirmation
• Phone skills practice Internet Specials, OEM
  Programs, Common Objections
• Phone skills training! Stuker, Rikess, Verde and
  others

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Putting it all TogetherPeople Process
Follow-up and Templates

• Use templates that provide quick and thoughtful
  responses
• Stop the shopper from shopping with your first
  response
• Answer the customers questions
• Introduce your Internet purchase process
• Ask for the next step The Appointment
• Drive towards live contact with all
  correspondence
• Avoid transactional sale comments
• Review phone scripts on a regular basis

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Putting it all TogetherPeople Process
Automation Tools

• You need automation to be successful
• Build a process to stay with them for at least 90
  days
• Automate routine tasks
• Report the key measures that drive sales
• Track all opportunities
• Dont loose them in the cracks
• Analyze ways to become more efficient

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Breakfast of ChampionsSummary Todays Key
Takeaways

• The Internet is an ADVERTISING medium
• The Internet Customer is EVERY customer
• The Internet should be the focal point of your
  advertising strategy
• The Internet is a lot to manage
• Website updating, tuning and optimization
• Internet search marketing
• 3rd party leads
• Owner Marketing
• Business processes
• Automation tools
• If you dont do it all and do it well you
  will lose business!

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Breakfast of ChampionsSummary Your Action Plan
to Put Into Place

• Demand commitment buy-in of your online
  marketing strategy
• Establish your website as the focal point of your
  advertising strategy
• Create a consumer focused, high-performance
  website
• Optimize your website for higher organic search
  engine placement
• Target Internet Search Marketing to drive
  additional website leads
• Synchronize all your online advertising with your
  offline advertising
• Purchase high-quality, high-performing 3rd party
  leads for new and used
• Establish an Owner Marketing program to build
  profitable relationships
• Create strong business processes that drives lead
  management success
• Provide in-store training to develop your staffs
  communication skills
• Establish follow-up procedures using
  high-performance templates
• Establish department policies for pricing, trade
  and finance questions
• Use automation tools to make your dealership more
  efficient and effective

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Breakfast of ChampionsAAISP National Convention

• Congrats to everyone that has come to the AAISP
  conference
• You are smart to be investing in to training and
  networking venues like AAISP
• Dean.evans_at_dealix.com