What’s your website doing while you’re not looking?
This week on Think Tank Tuesday, I reveal the steps you should be taking to increase conversion and traffic on your landing pages, and it’s more than just a "Thank You" page. After watching this episode of Think Tank Tuesday, your website will be successful in no time!
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Fort Lauderdale, FL – November 11th, 2013 — AutoUSA Internet Sales Solutions (www.AutoUSADealers.com) today announced the results of its 2013 annual auto dealer Internet Marketing survey. Financing tools such as online credit applications and trade-in calculators deliver the most valuable website leads, according to respondents. Other significant results from the survey identify pricing and affordability as the most commonly heard sales objection from consumers, while Internet departments' biggest challenges include lead volume and staffing issues.
"We believe the most successful dealerships have effective Internet marketing strategies, and this annual survey helps to identify how well some of those strategies are performing in current market conditions," said Phil DuPree, President of AutoUSA Internet Sales Solutions.
The survey was conducted during September and October and summarizes results from 147 respondents, including Internet sales managers, sales managers, BDC marketing and senior management.
Customer Sales Objections
When asked what the most common sales objection is from customers, the top response was "our price not in line with customer expectations" (28 percent). Other responses were "customer can't get financing" (19 percent), "customer confidence with the economy" (14 percent) and "customer can't afford a new vehicle" (12 percent).
By contrast, in AutoUSA's 2011 Internet marketing survey, not meeting the customers' price expectations was the least-common objection (10 percent). Also in 2011 "didn't have desired model available" was the most common sales objection (25 percent), followed by "can't afford a new vehicle" (14 percent).
"The difference in sales objections compared with two years ago is consistent with what we see in the marketplace; consumers are finding ways to work themselves through the process and further down-funnel," said DuPree. "And while the economy may have improved somewhat, pricing and affordability are still major hurdles for many consumers."
Internet Department Challenges
Survey results indicate that dealership Internet departments are facing a new challenge in 2013. "Not enough leads" (26 percent) is the most cited challenge for Internet departments, which is quite a turnaround from two years ago, when "keeping up with lead volume" (31 percent) was the number one challenge.
According to this year's survey, Internet departments' biggest challenges behind lead volume are related to staffing. Twenty-one percent of respondents cited "not enough staff" as the biggest challenge, while 19 percent stated "quality of staff," and another 18 percent chose "staff does not adhere to processes." Additionally, 18 percent complained their "marketing budget is not large enough to meet objectives," and only 17 percent cited "keeping up with lead volume" as their number one challenge.
"It's interesting that while Internet departments appear to be spending more than ever on search optimization for their websites, they are not getting their desired lead volume compared with two years ago," said DuPree.
Lead Volume and Quality
When asked, "which website conversion tools or add-ons results in the most leads (including phone calls) from your website?" respondents ranked the following: online credit applications (52 percent); chat applications (50 percent); trade-in calculator (37 percent); coupons (20 percent); online service appointment scheduler (19 percent).
Survey participants were also asked to rate the value of leads that they received from their websites. The most valuable are "VIN-specific used vehicle leads" (76% rate as "the best" or "pretty good"); credit application leads (73% rate as "the best" or "pretty good"); new vehicle leads (66% rate as "the best" or "pretty good"); chat leads (51% rate as "the best" or "pretty good"); trade-in leads (45% rate as "the best" or "pretty good") and lastly, general contact info (27% rate as "the best" or "pretty good")
"Inventory leads and leads from financing tools appear to be the most valuable to dealers, which makes sense because once customers start engaging with a website conversion tool they are probably serious shoppers," said DuPree.
Internet Marketing Budgets
In spite of the commonly cited statistic that more than 90 percent of consumers begin their search for a vehicle on the Internet, the survey found that most dealers do not allocate a majority of their budgets to Internet marketing. In response to the question, "What percentage of your overall advertising & marketing budget is spent on Internet marketing?" survey participants shared the following:
-50 percent of dealers spend less than 30% of budget on Internet marketing
-37 percent spend between 30-60% of budget on Internet marketing
-13 percent spend more than 60% of budget on Internet marketing
On the extreme ends of the scale, 10 percent of dealers spend less than 10% of their budget on Internet marketing, while only one percent of dealers spend 90-100% of their budget on Internet marketing.
However, in response to the question "do you plan to increase your Internet marketing budgets in 2014?" 59 percent of respondents responded "yes."
Survey respondents were also asked, "In which areas do you plan to allocate the majority of your Internet marketing budget in 2014?" The responses were:
-Website SEO/SEM (54%)
-Leads from inventory sites, i.e. Cars.com, Autotrader.com, etc. (51%)
-Independent leads from AutoUSA, Dealix, Autobytel (33%)
-Social Media (23%)
-E-Mail Marketing (22%)
-Video production and marketing (17%)
-Reputation Management (14%)
-Online ads (14%)
Finally, the majority of dealerships are optimistic for a profitable 2014. When asked if they believed they would sell more vehicles in the coming year, 85 percent of respondents claimed "yes, my dealership will sell more vehicles in 2014 than in 2013."
About AutoUSA Internet Sales Solutions
AutoUSA Internet Sales Solutions brings the best-in-class tools to increase Internet sales and lower costs for automotive dealerships. Leading products include Payment ProSM, a payment-based pre-qualification tool for dealer websites; ShowProSM incentive program, proven to turn more leads into shows; Leads&ListingsSM, providing the highest quality, new and used car email and phone leads from 100+ sites; PowerListingsSM 2.0, helping dealers increase traffic to—and leads from—their social media sites; and AVA Virtual Sales Assistant, helping dealerships manage more leads at a reduced cost. AutoUSA products are currently benefiting thousands of active dealers all across the U.S.
For more information, visit AutoUSA’s web site, subscribe to our blog at http://blog.autousadealers.com, follow us on Twitter @AutoUSALeads and “Like” us on Facebook at /AutoUSADealers
Most Internet marketing experts will agree that driving traffic to your website results in the most valuable leads you can get – if you can convert visitors into leads. Just like the old adage, “volume is vanity, gross is sanity,” your website traffic is only worthwhile if you’re effectively converting it into sales opportunities.
According to an advertising efficacy study by Dataium, an average of 55 percent of dealerships’ online advertising budgets are devoted to paid search engine marketing, but just six percent of dealership website traffic is referred by paid search keywords, and less than one percent of this traffic resulted in email form leads submitted on dealership websites. While effective SEO/SEM campaigns are necessary up to a certain point, eventually the law of diminishing returns kicks in. How much more are you willing to spend for a search term that attracts 100 more unique visitors when only one or two of those visitors will convert into leads?
Compounding the challenge of effective SEM campaigns is the cost. Many website vendors and Internet marketing gurus push dealers to pay more for “their” search terms because other parties-- competitors, independent lead providers, auto shopping websites-- are all buying up the search terms and bidding up prices. To some extent, this is true: it's open competition, and automotive retail isn't the only industry subject to it. Companies in every industry must aggressively compete to attract online customers with increasingly sophisticated SEM campaigns.
Since search is now integrated into the consumer’s everyday experience, it’s also important to pay attention to changing consumer behavior and modify your campaigns accordingly. According to a study by Slingshot SEO, more than 80% of search terms today use five or six keywords. Users are becoming more sophisticated with their search terms and demanding results that deliver exactly what they're looking for. If you are a Toyota dealer in Chicago and you think you can attain a page one search engine ranking simply by paying a lot for the terms "Toyota" and "Chicago," or your website content is the same as it’s been since you optimized it for search 5 years ago, you will be disappointed.
As the competition, sophistication, and challenges increase, your ability to convert precious, valuable search-generated traffic must improve. The average conversion rate for dealership websites is estimated to be between two and four percent. Some dealers claim conversion rates more than double this percentage. What if you could double the number of leads you receive from your dealership website, without spending a penny more on SEO/SEM campaigns? Increasing conversion is the key to achieving this goal.
To convert more visitors, try this three-pronged approach:
1) Content. Keep the content on your website engaging, up-to-date, educational, and include "calls to action" on every page. Also be sure that your content supports your brand consistently. If you're a family-owned business heavily involved in your community, ensure that your website content reflects and promotes this.
2) Conversion Tools. An increasing number of tools are available that are designed to engage visitors and keep them on your website. Chat applications are one of the most successful conversion tools; so are payment marketing tools like trade-in calculators and shop-by-payment tools like Payment Pro. Incentives and coupons have all been shown to increase conversion rates.
3) Marketing. Conversion tools will convert, but only to the extent that your website visitors know about them and use them. Don't expect them to just stumble across the latest tool or gadget on your site and start using it, unless they know what to expect. For instance, if you have a payment marketing tool, create a marketing campaign to educate your customers about their credit score and to let them know they can get accurate payment quotes without affecting their credit score. A full-blown marketing campaign might include the following elements: e-mail, a dedicated area on your website landing page featuring the benefits of shopping by payment, a blog, a video of one of your salespeople explaining the benefits, geo-targeted banner ads, and more.
If you have found that funneling more of your budget into SEO/SEM campaigns isn't getting you a proportional increase in website visitors, try focusing on increasing your conversion rate. Customers will stay on your site if they find what they are looking for, so figure out what that is and provide it to them to increase your website lead count and quality.
2013 is shaping up to be a good year for auto retailers, with sales expected to top 15 million for the first time since 2007. Several contributing factors to this success are credit-related, with more consumers qualifying for loans, lengthier terms and rising interest rates.
In its June 2013 State of the Automotive Finance report, Experian documents that subprime loans are on the rise again and that consumers within all credit tiers were able to obtain financing in Q1 of 2013. Most notably, loans going to consumers with credit outside of prime jumped to 45% percent of the overall loan market in Q1 2013, up from 44% percent in Q1 2012.
Many car buyers were taken out of the market over the last few years thanks to tight credit standards, and they may not understand that the market now provides them with options they didn’t have before.
Here’s how to leverage the latest credit trends:
1) Consumers Qualifying for Loans with Lower Credit Scores
If you track why people don’t buy from you, now is the time to go through your CRM and contact all prospects that were rejected for loans in the last few years. Create an e-mail marketing campaign letting them know that lenders are easing up on credit conditions and that your dealership may be able to help them finance a new or used car now.
2) Lengthier Loans Becoming the Norm
According to Experian, 63% of car loans in Q1 of 2013 were for more than five years, and about 20% were for more than six years. Lenders are finding that consumers are less likely to walk away from their cars than they are from their homes, and therefore auto loans are less risky.
Showing a low, teaser-style payment is attractive, but a comparative payment helps consumers make a decision. Show prospects a comparison on how extending the length of a loan may help to lower their monthly payment, and it’s both helpful to them and a “forced choice” close.
Amount Financed | Length of Loan | Interest Rate | Monthly Payment |
$20,000 | 5 Years | 4% | $368 |
$20,000 | 7 Years | 4% | $273 |
3) Rising Interest Rates Help Create Sense of Urgency
The average interest rate for a five-year new car loan is around 4.08% according to Bankrate.com, down slightly from 4.46% a year ago. That’s still very low, but recent spikes in U.S. Treasury bond rates and mortgage interest rates have sparked fears that the Fed may have to raise interest rates before their target date of 2015.
If a prospect says they may wait a while to buy, tell them it would be prudent to lock in a low interest rate auto loan sooner rather than later. The media’s your friend here since they’ve been focusing on the effect of rising interest rates on housing purchases. Provide your customers with a calculation of what their desired car will cost them with a 4% interest rate compared to 6% over the course of a five-year loan. For instance:
Amount Financed | Length of Loan | Interest Rate | Monthly Payment |
$20,000 | 5 Years | 4% | $368 |
$20,000 | 5 Years | 6% | $386 |
A difference of $20 a month may not seem like much, but over five years the higher interest rate adds an additional $1,200 in finance charges. Car buyers could use that extra money for a vacation somewhere (in their new vehicle!)
Finally, extend this philosophy to your website to increase your conversion rate. Having payment marketing tools on your website, such as Payment Pro’s Shop-By-Payment, combined with a targeted marketing campaign that shows customers their financing options will help drive buyers to your website.
Back in 2009, the team of Mike and Maaike, the designers behind Google’s G1 Phone among other innovations, released a concept design for the car of the future. Lost behind the futuristic glass enclosure and auto-drive capabilities were the reasons they undertook the project: “Freed from the monotony of driving, we can enjoy quality time while in transit: socializing, gaming, movies, business, videocalls, web surfing, sleeping or discovering new places with powerful voice controlled search and navigation.”
We’re a car culture. Our manufacturers continue to advertise power, performance, passion, heritage and sex appeal—but the next generation of buyers is less interested in that than they are in engagement, connection, impact and lifestyle. To them, driving is a distraction from their life.
In 2010, the millennials (the current 16-34-year-old demographic) surpassed the baby boomers as the largest generation in the United States, with more than 77 million members, or one in four Americans. Inevitably—and soon— they will buy more cars, get married, buy houses and have families. At the same time baby boomers are retiring and driving less, so understanding how to sell to millennials will be critical to your dealership’s success.
When you are able to identify the approximate age of an Internet lead, how do you respond to those in the 16-34 age group? Here are a few tips on how to respond to millennial Internet leads:
1) Price is Important….: The millennials have had a tough time establishing careers in this down economy, as evidenced by a 16% unemployment rate in their age range. Many also graduated college with student debt. Lack of finances is one big contributor to why many of them aren’t currently buying cars. If you notice their inquiry is on a “budget” car, respond by sending links to similarly priced vehicles, both used and new.
You may also want to bring up financing options with millennials sooner rather than later, so you don’t spend a lot of time selling them a car they can’t afford. Fortunately, credit restrictions for auto purchases have been easing lately. Offer to help them become qualified, and send links to whatever payment marketing tools are on your website. If you have a new generation shop-by-payment tool, they will be able to peruse your inventory based on what their monthly budget is.
2) ….But Not as Important as the “Feel Good” Factor. Although millennials may be looking for value, giving them the bottom line price is not guaranteed to get you the sale. In general, neither will selling the features of the car. Less than 15% of millennials describe themselves as “car enthusiasts,” compared to 30% of baby boomers,* making a car more of a commodity than an emotional purchase.
Most millennials want to “feel good” about what they’re buying. In a 2010 Pew Research Center study, more millennials said “Helping Others In Need” is more important than “Owning a Home.” So if it’s a hybrid, emphasize the benefits to the environment. If your dealership is involved in the local community, try to weave in a conversation about a charity you recently helped out, or other social benefit that your dealership has provided. Another strategy is to share YouTube ads from the brands they inquired about, to help them decide which brands they identify with.
3) Let Others Do the Talking. Millennials are extremely active with social media and use the Internet to do most of their research. In general, they trust the opinions of their friends and the masses before they trust recommendations from a salesperson. If possible, let your social media platforms and online review sites do as much of the “selling” as possible for you and your dealership. Send them links to the objective, third-party research sites, to your online review sites and especially to any reviews that may specifically mention you, the salesperson. If you don’t have any video testimonials from customers, get some, then send the links to those on your YouTube channel.
4) Don’t Pressure Too Much, but Don’t Give Up. Millennials are in a state of “constant consideration,” so if they don’t respond to your request for an appointment, or stop responding entirely, don’t give up. It may be they’ve backed off the idea of purchasing for the moment. Chances are they will still purchase in the next 90 days, and when they do it will be with someone who they have built a rapport with.
5) Use Your CRM For Communication Preferences. Millennials expect companies to do business with them on their terms. This means if they prefer to text, you should be texting them (or your competitor who does text them will be the one to engage with them).
The millennials now outnumber boomers, and their growing purchasing power will soon be felt. What tips do you have to market to this tech-savvy generation?
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*Statistics taken from the Spring 2013 research report “A New Direction: Our Changing Relationship with Driving and the Implications for America’s Future” by the U.S. Public Interest Research Group.
There's a big, fat lie in the automotive industry that has been circulating for years. The idea that many hold onto is that conversion rate is the most important number when trying to determine the quality of a website. This couldn't be further from the truth.
Here's a fact - the worse your search marketing is, both for SEO and PPC, the higher your conversion rate is going to be. This cannot be disputed. If buyers are only able to find your dealership on search if they're typing in your name, that means that the only people visiting your website are already inclined to consider doing business with you. Searches for you by name will always yield the highest conversion rates from the visitors.
As your search marketing expands and you start bringing in people from a more diverse range of searches, the traffic goes up, the total number of leads go up, but the conversion rate drops. Total number of leads, however, go up. It's very simple once you understand the dynamic.
Let's say you're currently getting the majority of your search traffic from a variation of your name. Look at your analytics to see if this is the case. With the majority of your traffic coming from searches for your name, the math may look like this:
Your goal as a dealer is to sell more cars. It's mathematically inefficient to extend your search reach and as a result your conversion rate goes down. However, the number to focus upon for your website is total conversions. How many leads are you getting? How many sales are you generating from these leads? This is the bottom line that truly affects the success of your website and your business.
Conversion rate is a great indicator that can help you make tweaks and adjustments to your current site, but look at your traffic trends when considering conversion rate fluctuations. Improved conversion rate can be good, but if it's associated with a drop in traffic, you should look at your search rankings and the keywords driving traffic to determine if there's an underlying negative that's making the numbers look good. Conversely, if your rate goes down, see if there's a correlating increase in traffic.
Get more leads that convert to more sales. That's the end goal. Don't get lost in the numbers that some are throwing out at you.
