Article

Thinking Social

Dealers open up their social media playbooks, and reveal the dangers and challenges of building and maintaining an online reputation.

February 2013, Auto Dealer Today - Cover Story

by Daryl K. Tabor - Also by this author

Put 10 auto dealers together for a discussion on the topic of social media as a marketing tool, and you’re likely to get 10 different opinions on how to best utilize the technology. The approaches dealerships take toward social media may vary based on size, age of the company, whether they are a single- or multi-point dealerships or even geography — rural or urban.

“So many factors come into play, even your people,” said Tom Hauswirth, general manager at Moritz BMW Mini Cadillac in Fort Worth, Texas.

Like a Super Bowl coach whose defense has yet to figure out how to stop the opponent’s passing attack, those drawing up the plays at the dealership must adjust their business strategy to accommodate social media if they want to stay in the game, said some authorities in the car business.

“Internet and social media are here and not going away,” said Kathi Kruse, an automotive social media coach who has spent the past three decades working in and with dealerships. Kruse’s company, Kruse Control, was established to provide operational-type advice to dealers, but shifted gears into social media coaching when the economy tanked.

“Social media networking is as important as seeing your customers face-to-face, as a first impression is a lasting impression — even online,” said Kim Green, Internet manager at DeCozen Chrysler Jeep Dodge in Verona, N.J.

On the whole, however, auto dealers have been a little slower than other retail industries at adding social media into their marketing strategies, said Les Abrams, an instructor at NADA University in Washington, D.C. The good news, he added, is industries that have delved into social media are still struggling with how to incorporate social media into their overall business plans. “I think all industries are still trying to figure it out,” Abrams said.

Kruse blamed the slow adoption of social media into marketing plans to the generation gaps inside dealerships, which has caused some operations to feel intimidated by or turned off by advancing technology. “It seems new,” she said of social media, “but it really is one of the oldest ways of selling. It’s just having conversations with people.”

Without organization and a clear strategy, however, those conversations can dissolve into little more than a din of chatter void of key performance indicators (KPI). “Internally, few companies are prepared with proper roles, education or clearly defined goals,” concluded a 2012 study, titled, “A Strategy for Managing Social Media Proliferation.” Altimeter Group, an independent business research and advisory organization, conducted the study and found that some global companies are struggling to maintain scores of social media accounts, excluding personal accounts within the organization.

While the typical dealer doesn’t have as many social media accounts as larger corporations, they do face similar hurdles. “Beyond coordination challenges, unchecked accounts and disparate customer interactions expose brands to a host of legal, compliance and fragmented brand-perception risks,” Altimeter warned.

FROM THE TOP

Actions dealerships have taken within their digital marketing department to utilize social media run the gamut. Some have been content with a near- static presence on social media sites, rarely (if ever) updating posts. Other operations set goals within management, such as the number of desired friends or “Likes” on Facebook, a tally of followers on Twitter or views of YouTube videos.

Through Internet analytics, dealers can also set a target and track the number of leads social media drives to the dealership’s website. However, some dealers prefer not to set hard-and-fast goals, preferring to merely engage consumers and build relationships. “In your heart, you know you’re going in the right direction, but you can’t show it on paper,” said Hauswirth, whose Texas dealership measures social success by its interactions with people, not numbers.

Some of these plans are good, and some fall far short of the potential social media has for helping dealerships flourish. Altimeter concluded that the business world, in general, has approached social media “haphazardly, with little control or quality assurance.” As an example, businesses are relying on social media management systems (SMMS) to drive up the number of friends, “Likes,” followers, etc., but fail to engage their fans, some of whom may be half way around the world. “Vendors can get you a ton of Facebook ‘Likes,’ but are they real?” questioned Hauswirth. “Our headcount (of Likes), quite candidly, is not big, but the ones we have have been engaged.”

Success in the social media realm starts internally, with those individuals at the top taking the lead and incorporating all levels of the dealership to formulate clear social media tactics. Syncapse, a social media marketing firm, offers advice in its white paper, “Empowering the Automotive Customer Journey Through Social Business Transformation.”

“The more interest and sophisticated understanding of social media from senior executives, the more the future of consumer interaction and service becomes a C-level and board-level conversation,” read the report. “Conversations evolve from ‘Social media is important’ to ‘We know what we need to do and how to do it’ to ‘How do we best track and measure progress?’”

But prior to formulating measurable social media goals in the executive wing, the dealership should have its own clear mission and goals, as well as departmental goals before the success of social media can be gauged. “It’s not just something you can throw money at and then have somebody do for you,” Kruse added. Kristin Coleman, business development director at R.C. Lacy Inc., a Ford dealer in Catskill, N.Y., said getting the dealer principal’s support is key, but getting all employees to believe in the power of social media can still be a challenge. “We’re still trying to get everyone to understand,” Coleman said, qualifying that her dealer principal fully supports the social movement. “Not everyone is 100 percent on board with how effective social media can be. Not everyone sees the value in time spent (developing social media).”

Paul Sansone, Jr., owner of Sansone Jr.’s 66 Automall, said delving into social media requires a different mindset and approach. It’s one that goes against what most dealers have learned about retailing vehicles. “A lot of dealers like myself, who didn’t grow up with Facebook, are not personally comfortable or active in it,” he said. “Unfortunately, most dealers want immediate results for their advertising (money). They want to quantify, ‘I spent this much money and generated this many sales.’ Social media is very tough to quantify the short-term results.”

Despite this, Sansone said it didn’t take much for him to be convinced of the need to engage potential car buyers through social media. “My personal motivation is that I see my 20-, 18- and 13-year-old kids on it all the time, so I knew I had to be there.”

SELL THE BRAND, NOT CARS

But just being on a social media site is not enough. Without first establishing a desired social media tactic and KPI, retailers can be dealing with a counterproductive, even volatile, marketing platform. “It’s almost worse for you to be on there and not know what you’re doing than it is to not be on there at all,” Coleman warned.

With social media, dealerships should develop their online brand, or the image they want the cyber community to perceive from their social presence. Once that brand is established, a dealership can begin developing the tactics needed to get measurable results. “Get it on paper, so when you’re talking about your brand on social media, you’re coming from an authentic place,” Kruse said, adding that the desired brand should be part of an internal social media guide.

A dealer’s ultimate social media goal may be to generate leads, drive traffic to the store’s website, remain top of mind with potential car buyers through conversation, or to simply reinforce the brand. But social media is not an effective place for direct sales, experts warned. “This is an opportunity to establish a relationship for a future car buyer, not make a sale,” said the NADA University’s Abrams.

Candace Lawley, digital marketing director at Fisher Auto, a Honda and Kia store in Boulder, Colo., said her dealership explicitly avoids selling on social media. Reinforcing the operation’s image by engaging the community is the auto group’s primary aim. “For now, the goal of our social media efforts is to brand Fisher and to promote events and such,” Lawley said. “That being said, we do see social sites referring traffic to our websites, namely Facebook and Pinterest.”

PICK A PLATFORM

The next steps in managing social media pages are more tangible than culture or branding. Selecting the social media platforms that best fit your organization and selecting who will manage the associated accounts are critical components of a successful strategy. But those are not easy decisions to make amid myriad choices.

As for which online platforms are best for your brand, there are scores of selections. But Kruse said there’s one site with which every dealer should start. “Of course, the answer is Facebook, because that’s where everyone is,” said Kruse.

SocialBakers.com, a social media analytics platform, reported that Facebook is the most-used social medium in the United States, with U.S.-based users accounting for 168.1 million of the site’s one billion users. That’s more than half of the nation’s population and almost three-quarters of those with Internet access. The king of social media, however, has an audience demographic that may vary widely from other sites.

According to Pingdom.com, which monitors online traffic, the demographics of 24 leading social media sites measured by Google’s DoubleClick Ad Planner showed that reaching a desired audience depends on where you interact. For instance, more than half of social media users are between the ages of 25 and 44. Additionally, 79 percent of LinkedIn users are over the age of 35, while 83 percent of Orkut users are under 35. Dealers also have to consider that women are more likely to be social on certain platforms than men.

To reach a target audience, dealerships may employ numerous outlets to build relationships with the online public. At Fisher Honda Kia in Colorado, the digital department oversees the operation’s Twitter, YouTube, Pinterest and FourSquare ac- counts in addition to Facebook. Another social exchange Fisher utilizes is blogging.

“Blogging is the way to go,” said Kruse, adding that blogs hold an array of advantages over most social media sites, such as search engine optimization through key words and tags. Plus, most conversations on social media sites are with people who have not yet entered the sales funnel. But that doesn’t mean those conversations aren’t important, as a dealership needs to remain top of mind and build that relationship to ensure that the customer enters the sales funnel with the dealership when he or she is ready to buy.

For consumers who have entered the funnel, dealers may best benefit from rating and review sites like DealerRater, City- Search, InsiderPages, Google Plus and Edmunds.com. Abrams encourages dealers in his courses to solicit online reviews from more customers because engaging the customer on rating websites allows the dealer to showcase his or her process to those who have gotten as far as researching vehicles and dealerships. Even addressing negative reviews can win over customers, the instructor said. “It becomes a body of evidence people can see,” said Abrams, who spent 22 years with franchised and independent dealerships before joining the NADA five years ago. “That’s where I like to see people start.”

Moritz’s Hauswirth said DealerRater is his operation’s favorite site. He added that he even believes sites like DealerRater will either change or eliminate OEM Customer Satisfaction Index programs.

“With DealerRater, people are coming in and asking for an individual salesperson,” he said. “It replaces the traditional referral.”

WHO WILL IT BE?

The final decision a dealership needs to make is to select who in the dealership will manage its social media accounts. Some dealers choose to promote from within, while others will look to hire an individual to manage the dealership’s online reputations. Other dealers find that contracting with third-party SMMS vendors is a better way to go, either on a full-time basis or to complement or oversee the dealership’s in-house efforts.

“Companies that acknowledge they need to act — especially those unsure of how best to proceed — need to base their decisions on business goals,” the Altimeter study advised.

If looking to an individual to manage the store’s social media pages, resist the temptation to stereotype. Neither age nor gender is a determining factor as to how successfully an individual manages social media. “It’s more a mindset, and understanding the customer and how they want to shop,” Kruse said.

At R.C. Lacy Inc., Coleman, a woman, is the go-to person for all things social media, while Fisher Honda and Kia has a man leading the dealership’s social media efforts under Lawley’s supervision. In her coaching career, Kruse has encountered a range of people considered for social media manager, from adept 55-year-olds to 20-year-olds scared to death of Facebook.

The other option is utilizing off-site management. A number of SMMS vendors are available to auto retailers. These companies offer everything from personal consultation for on-site media management to branding and loyalty plans, and automated conversations.

“We have management staff and one company that helps us with our social media,” said Hauswirth. The general manager said the dealership turned to EFG Companies to augment its inhouse efforts less than a year ago after the departure of the dealership’s social media specialist.

Attempts to replace the former employee were unsuccessful. “We didn’t feel like we had anyone internally to handle it,” Hauswirth said. “We felt we were best suited to hire outside help.”

At NADA University, where digital marketing management is one of the areas of training offered to dealers, Abrams is wary of complete reliance on SMMS, particularly with automated conversations. “The dealers need to be very careful with these things,” he said. “I think people in the community can see if it’s genuine. It’s too important of a conversation for someone outside your dealership to be handling.”

Abrams’ assessment is supported by the Altimeter report, which revealed that more than half of SMMS subscribers in the business world were “unsatisfied by nonexistent or lightweight capabilities.”

ESTABLISHING GUIDELINES

While internal social media managers may handle all of the dealership’s social media accounts, the personal accounts of individuals within the dealership present a double-edged sword for upper management. There have been documented cases of the courts siding with employers who have fired employees for posting disparaging comments about the company they work for on their personal Facebook pages. While oversight of those personal accounts can be precarious, prohibiting them is hardly imaginable. “It’s not necessarily going to work, having a gatekeeper of salespeople’s social media,” Kruse said. “It’s very hard to control.”

If social media use is clearly defined, however, it has huge potential for the dealership. That’s why both Abrams and Kruse are adamant that dealers have documented guidelines for social media usage by employees. This better ensures content strategy is followed and branding is not damaged. “I always urge them to have a written policy,” Abrams said. Dealers should not discourage personal social media usage; they simply need to keep it reined in. Employees are going to be a really strong asset when it comes to generating content, Kruse added.

Coleman said salespeople at R.C. Lacy Inc. regularly use their own Facebook pages to interact with customers. “They do some postings for specials, but mainly it’s used for personal use,” she said, adding that the accounts are essentially self-policed. “We’re all pretty much (Facebook) friends in the building, so you really can’t get away with anything.” Regardless, the dealership is in the process of adding formal social media guidelines to its employee handbook.

Hauswirth said Moritz BMW Mini Cadillac also has rules in the making. He said personal use of social media by employees is neither forbidden nor promoted. “Some do have Facebook pages, but none are tied to the dealership,” he said. “We haven’t really had any problems.”

Meanwhile, Fisher Auto relies purely on self-policing and trust. “We do not have any policies regarding an employee’s personal accounts,” Lawley said. “Some of our employees have Fisher Facebook profiles, but we don’t have any specific guidelines for them. We trust that they know what’s appropriate and what’s not. We have had no problems doing it this way.”

MEASURING RESULTS

Gauging your return on investment (ROI) with social media use can be tricky, but it can be done when tied to the dealerships established goals and KPI. Measuring leads and traffic to your dealership’s website can be accomplished through URL tracking. In fact, numerous analytics offer a view of your success.

“Right inside of Facebook, there are insights that show you measurements on your ‘Likes,’ how well you’re doing at reaching people and what kind of engagement you’re getting on each post,” reported Coleman. “There is so much more to insights and what it will actually show you, such as demographics and location of the people who like your page.”

Comments, retweets, shares and replies can tell you how often people are talking about your dealership, which is how Hauswirth measures engagement at Moritz’s Texas stores. Analyzing how far your brand is reaching and how much exposure it is getting can gauge brand awareness. And if your goal is to determine where your dealership stands among the competition, simply track their social media engagement, reach, exposure and the types of interactions they’re having with their online community.

But be prepared to be flexible with goals, strategy and even KPI, as rapid evolution of social media is likely to keep even the most progressive dealers on their heels. Driving success across all stages of the organization and distribution networks requires workflow adaptation or “social business transformation.” According to the Syncapse report, this can be done through three distinct areas: buy-in from the C-suite, tailored technology and services, and ROI measurement.

“Anyone who does think they have it figured out, just wait a year,” Hauswirth said. “There is no auto pilot with this stuff."

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