During the National Automobile Dealers Association (NADA) Convention & Expo in New Orleans in January, Auto Dealer Monthly sat down with some of the top marketing experts in attendance. Executives from Facebook, Google, Dealer.com and PCG Consulting, among others, offered predictions for the year ahead and encouragement for dealers who want to adopt new marketing technology in their operations and reach car buyers on their smartphones, tablets, social media sites and search engines.
Facebook: Pick Your Battles
Facebook’s head of automotive strategy, Kass Dawson, says that dealers need to maximize their own data sets, rather than thinking they are going to go to one place and “get all the data in the world.”
“Start with what you have,” Dawson says. “Build off of that. … Stay on top of your own data, be an expert in your own data. Then start looking at ways to bring in the media partner’s data and third-party data. All of that is going to help with targeting. It becomes more challenging to reach and convert consumers, because there are going to be more cars on the road. And we’re predicting that SAAR is going to continue to go up.
“Breaking through the clutter and cacophony of messaging is going to be really difficult. So that’s where the efficiency of targeting is going to be really important in driving effective campaigns. With the relationships through Datalogix and Polk, Facebook has the ability to identify people who are shopping for a particular car. That’s fantastic targeting that all dealers should be taking advantage of.”
Dawson didn’t appear to indicate that dealers should invest much time in Graph Search, the Facebook-only search engine that launched in 2013 — at least not yet. “I’m not sure how widely spread the use of that is on Facebook, in terms of how many people are using it. I think what we offer in terms of targeting, especially in terms of targeting with Polk data, is as good, if not better than trying to worry about what people are doing or searching for on Facebook.”
The social media site also received attention after its recent launch of a new, auto-play video ads. Dawson notes that, because the ads aren’t “geo-specific,” they might not be targeted enough to interest dealers; however, the rollout did help his team at Facebook get feedback on what dealers expect from video ads. Now, as a result, “If you want to upload your own video and run that through a page post to a targeting audience, dealers can do that and we have the ability to provide some of the metrics, [such as] click-throughs, view-throughs and how much of the video they watched. Now we’re providing that as a measurement in our units.”
Dawson believes that dealers’ focus should be on mobile-device users. “We have a significant amount of people’s time on mobile: One in five hours spent on your phone is on Facebook. … I would suggest you spend more time advertising to target audiences than worrying about trying to pay for fans or drive your fan page up. That should happen organically; you should be spending money to drive people to your dealership.”
Google: YouTube and Google Cars
Google’s Jay Majithia predicts that paid search will continue to be the driving factor for leads from his company. While in 2012, car shoppers landed at 18 research points on average, this year, that number grew to 24 research points. “In my humble opinion, [I predict] that number is going to keep growing,” he told attendees of the NADA’s Best Training Day Ever. “Basically, this means that anybody as a car shopper is open to influence. … Most people, when they go out and set up to research something, that changes throughout the process. Seventy-five percent of purchases do not occur on the first brand researched.”
Video ads, mainly displayed through Google-owned YouTube, will also increasingly resonate with the right customers, according to Majithia. TrueView ads, which allow online browsers to skip a YouTube ad if they so choose, are laying the foundation for video aimed to give consumers more choices while targeting interested consumers. He adds that beta testing for Google Cars, an online vehicle inventory for dealers located on Google’s homepage, concluded in late January. A Google spokesman said the company is “committed to the space” and indicated that the stoppage is only temporary.
PCG Consulting’s Brian Pasch agrees. “[Google is] retooling the project to add some additional functionality,” Pasch says. “I wouldn’t count them out. Google has the ability to do anything it wants. Some people said, ‘Oh, wow, Google finally found out how hard it is to be in the car business.’ That’s not why the program got put on hold. They know that it will be a revenue stream. They are very concerned about doing it right because of the regulations in each state.
Pasch also predicts that vehicle detail pages will soon take center stage, noting that dealers should routinely track those metrics. “The number of VDP views on a website is a good predictor of future sales,” he says. “So instead of just looking at cost per click, ad measure, Google AdWords, looking at cost per VDP and number of VDPs that advertising is generating is a big trend.” He added that dealerships need to be equipped to take more phone calls. “As more people are using their mobile phone to search more, they are clicking the [‘Call’ button] more. So this will make us get back to the basics.”
Dealer.com: Return of the Phone Call
Dealer.com’s chief digital strategist, Dave Winslow, agrees with Pasch, and he foresees continued growth in mobile in 2014. “Three years ago, about 3% of traffic was coming from mobile tablets. In addition to that, over 90% of leads generated through mobile sites are coming through phone calls. So we’re kind of getting back to a consumer taking action by placing a phone call versus filling out a lead form. So dealers really have to be ready for an overall increase in phone activity, making sure someone is on the phone, ready to go.
“The other exciting part is that over 80% of our Dealer.com customers now have a mobile-optimized site, so with one out of every three customers coming from a mobile device, now you’re seeing four out of five dealerships being ready for that experience. It really needs to get to five out of five, because mobile is not going away. And it’s really changing the shopping experience.”
As for other trends, Winslow expects a big uptick in display advertising, vehicle merchandising and video advertising. Dealer.com has seen a 200% increase in the number of visits coming from YouTube to its dealer websites.
“Dealers are going to start advertising more of their video spots for YouTube and other video networks out there,” Winslow says. “Probably the other thing we’re seeing is social advertising starting to pick up momentum as Facebook and Twitter and Yelp and some of these other social platforms become more important in reviews and research in consumers’ shopping journey. Facebook and Twitter in particular are really pushing the angle to get small business advertisers onto their platform.”
eBay’s Clayton Stanfield says that motivating younger buyers, collectively known as Millenials, will be the key to sales for most dealers. He points out that 86 million Millennials are coming of car-shopping age, and have a buying power of an estimated $170 billion, according to comScore, making them a key target for dealers.
In order to reach this audience, Stanfield says, dealers must engage with them in the ways they prefer to shop. For example, 94% of Millennials go online to gather information when shopping for a new car or truck, and 44% of Millennials are likely to use mobile devices to compare prices or get information while they are at a dealership. Stanfield says that dealers who are not yet engaging with consumers via online and mobile channels risk losing the significant new stream of revenue that Millennials can provide.