All incoming sales calls and every lot up should be ad-sourced and lead-sourced—no exceptions. Determining the source of every lead allows you to generate a report that will show you whether your dollars are being spent effectively. Without this reporting, you may wind up wasting thousands of dollars a month.
In a perfect world, dealers should monitor ROI reports for 60 to 90 days before adjusting their advertising/marketing, but many managers want things done yesterday. I suggest reviewing ROI reports weekly, so you can identify trends and adjust, rather than react, quickly. A dealer who decides to cut ad expenses without examining ROI reporting could be cutting business as well.
Additionally, ROI reports need a cross-reference of accountability. If every lead isn’t being handled as best it could or the sales calls have no guidance, these issues can be addressed through quality control, or training may be needed. Keeping an eye (and ear) on your pipeline of prospects can identify whether you have a procedural concern prior to just changing course in your marketing strategy
Without proper ROI reporting, a dealer who is spending over $5,000 a month on one paid lead source and $2,000 a month on another might be quick to cut the source with a higher monthly cost. However, the $5,000-a-month lead source could be resulting in three times the gross as the other, which makes it a cheaper lead source.
For ROI reporting to be accurate, no one hangs up the phone or leaves the property until you know specifically what drove the traffic, and that can be done very eloquently. Instead of just asking the customer, “How did you hear about us,” you can ad-source/lead-source with an assumptive question like, “Did you receive something in the mail or hear us on the radio?” Then, the customer will tell you the real reason and say something like, “No, we actually saw you on TV.”
You can then dig deeper by asking customers which station they saw your ad on. You can even break down your television advertising by station on your ROI reporting to uncover which stations generate the most traffic and profit. Even if you have toll-free numbers dedicated to tracking and identifying specific campaigns, process and skill are key to conversion. A simple validation of their timing or choice can go a long way in lowering defenses. The lower one’s defenses are, the more they share. Knowledge is power and quality information is paramount to accurate ROI reporting.
Similarly, most Web pages offer reporting that you can use to break down how different sections of your Web site, like “chat now” widgets, spokesmodels (are they annoying or helpful?) or lead points on different pages, are performing. If you’re paying for an add-on to your Web site and accurately sourcing leads back to it, you can easily figure your ROI on that spend. I suggest not depending solely on analytics. They can be misleading and don’t share why someone left or spent little time on your Web site. Talk with your customers. They can tell you a lot more than your software. Don’t get me wrong, we need measurements from multiple angles, but the personal touch of human interaction (along with diligent follow up, of course) is what will develop repeat and referral business.
Lately, I’ve noticed database marketing is on the rise. Dealers are scrubbing their database for specific groups of customers and then marketing to them. While there are several different groups of customers dealers can target, I see a lot of dealers concentrating on driving traffic to their service departments. Another surprising trend is that newspaper seems to be performing better than it used to be in some areas. Print is certainly not dead. Purchased leads with proven track records help keep the equation balanced.
The advantages of tracking your ROI are great, as proved by one dealer I work with who significantly increased his ROI and profits. So far this year, he has already increased his net by a million dollars when compared to last year’s!
Any time you can equate production with different ad and lead sources, you have more of an ability to forecast, and by concentrating more of your spends on sources that produce well, your sales should increase.
Vol. 6, Issue 10