The Future of Automotive Marketing: Building Your Digital Sales Funnel
The automotive market is growing — and so is the competition.
What started out as traditional marketing like TV and radio continues to fragment to what feels like hundreds of digital channels, platforms and options.
The future of automotive marketing is focusing on the people who are actively shopping — and today, that’s online.
Moving Digital: Create Your Sales Funnel
An auto dealer can use a digital sales funnel to judge the success of their sales and marketing teams.
This sales funnel measures how many people enter the funnel as a lead and how many of those leads end up purchasing.
Along the way, there are some important benchmarks to check. These benchmarks make up the six parts of a digital sales funnel (visual below):
- Leads
- Leads who can be contacted
- Appointments set
- Appointments who show up
- Sales from those appointments
- Total conversion rate of the above steps
6 Parts of an Auto Dealer’s Digital Sales Funnel
Let’s walk through each of the six parts of the digital sales funnel to understand:
- What it is
- Why it matters
- Benchmarks for each stage
- How to improve your number
1. Leads
What it is: Leads are the most familiar metric for automotive marketers. Most often, marketers are judged by their ability to generate leads for their dealerships. A lead would be any potential customer for whom you have a means of contact (e.g. phone number or email address).
Why it matters: Filling the top of the sales funnel is one way to grow a dealership. The more leads you have, the more people you have to reach out to and convert into sales. As long as your sales conversion rate does not change, attracting more leads will lead to more sales.
What qualifies as a strong lead count: On average, about 1% of web traffic should convert into digital leads. That means if your site gets 10,000 visitors a month, you should be generating at least 100 digital leads.
Leads from third-party lead providers or other sources that do not touch your website should not be counted in that number.
An okay number of leads would be 0.5% of your web visitors converting into leads. A great conversion rate would be 1.5% of your web visitors.
- Web Traffic to Digital Lead Conversion Benchmarks:
- Below average: 0.5%
- Average: 1%
- Above average: 1.5%
How to improve: The simplest way to get more leads is to make it easier for digital shoppers to give you their information. Using things like chat windows and forms for undecided shoppers will increase the number of leads you generate.
The second way to get more leads is to get more traffic. The majority of marketing dollars are spent on this type of lead generation, which can range from traditional TV commercials to online ads.
The best way to improve traffic generation (and thus lead generation) is to create a Google Analytics goal for a form submission. Then, look at the analytics to learn which channels are creating the most leads and what your cost per lead is. Spend more money and time on the sources that create the most leads.
Even better, follow those leads into your customer relationship management (CRM) system to see who purchased and spend time on the sources that generate the most sales.
2. Leads Contacted
What it is: Not all digital leads are reachable — some may provide fake contact information. Leads contacted refers to the percentage of leads with valid phone numbers or emails, regardless of whether they respond.
Why it matters: If you can’t contact a lead, you can’t sell them. Also, using these criteria to determine a good or bad lead will give you a consistent metric to work with. Too often, leads are marked as “bad” simply if they don’t answer their phone or email. This label should be reserved for people who literally cannot be found or do not exist.
- Leads Contacted Conversion Rate Benchmarks:
- Below average: 60%
- Average: 70%
- Above average: 80%
How to improve: Ask for only the contact information you really need and give visitors the option to choose how they want to be contacted. They might prefer a text to an email or phone call, for example.
If you’re asking a visitor to give you their phone number or email address, it should be because they want a reply to a specific inquiry. Long forms that only block basic information often lead to inaccurate data as customers become frustrated.
3. Appointments Set
What it is: When a lead is contacted, the best next step is for them to make an appointment at the store. Appointments set refers to the percentage of leads contacted who schedule an appointment.
Why it matters: Getting a potential buyer to come to your dealership dramatically increases your chance of making the sale. It also allows your store to confirm their contact information and identify the best vehicle for their needs.
- Appoints Set Conversion Rate Benchmarks:
- Below average: 25%
- Average: 35%
- Above average: 40%
How to improve: Specific language on the phone or in an email should be used — and tested — to identify the best way to book appointments.
Use a script for phone calls and a template for emails. Even better, use two scripts, and compare which one works best. Then try another version the next month so that you continually improve your conversion rates.
Marketing automation software can track what people are looking at on your website and when they are clicking your emails. Contact them while they are active on your site or looking at your email to increase your chance of getting them on the phone.
You can also use email to follow up with form submissions by directing them to book an appointment. There are many tools like HubSpot Sales Pro that will allow a shopper to set an appointment themselves.
4. Appointments Shown
What it is: Appointments shown refers to the percentage of appointments set that actually come to the dealership.
Why it matters: Getting customers to show up for those appointments makes it easier to make a sale. A personal relationship trumps digital communication any day.
- Appointments Shown Conversion Rate Benchmarks:
- Below average: 70%
- Average: 80%
- Above average: 90%
How to improve: Reminders are essential to improve your appointments shown metric. Technology can help provide text or email reminders.
Even better is a reminder from a manager. Have your sales manager call every appointment the day before they are scheduled to show up.
Finally, make the appointments shown metric a key focus of your staff. Send an email to your employees every morning with a list of the appointments scheduled to come that day. Everyone on the floor should be looking for these shoppers and ready to welcome them.
5. Appointments Sold
What it is: After someone comes to their appointment, the percentage of those shoppers who buy a vehicle are appointments sold.
Why it matters: This is the final step of the automotive sales process. Your sales team needs to close the deal so that all your hard work in generating and converting the lead results in a sale.
- Appointments Sold Conversion Rate Benchmark:
- Below average: 60%
- Average: 70%
- Above average: 80%
How to improve: The sales techniques your sales reps are trained to use will come in handy at the bottom of the funnel. The strategy will change depending on how your store prices vehicles (one price, negotiating, etc.). In general, work to make the process efficient, transparent and respectful.
6. Total Conversion of Digital Leads
What it is: Your total conversion is the pot of gold you are looking for. This is the percentage of digital leads who buy a vehicle.
Why it matters: Knowing your total conversion will drive your marketing decisions and enable sales forecasts. If you know that 10% of digital leads purchase a vehicle, you know that adding 100 leads will result in 10 additional sales.
- Total Conversion Rate of Digital Leads Benchmarks:
- Below average: 6.3%
- Average: 13.7%
- Above average: 23%
How to improve: Improve your total conversion rate by improving the weakest step of your sales funnel. If you are below the average conversion for one of the six steps, improve that area of your business.
By focusing on the lowest-performing steps of your sales funnel, you will have the biggest impact on your total conversion.
How to Measure Your Digital Sales Funnel
Your CRM enables your store to quickly find your sales funnel numbers, so you can easily keep track of what’s working (and what’s not).
Here’s how to pull the sales funnel data for three select CRMs.
1. VinSolutions
VinSolutions makes it easy by having your sales funnel on the Dealer Dashboard labeled as Internet Sales Funnel.
You will find each step of the sales funnel named and color-coded. Note that the number of sales may exceed the number of appointments if shoppers purchase without making an appointment.
2. DealerSocket
Click Management > Analytics > Internet Reports > Internet ROI. Then, set your date range.
You will see each step of the sales process and its corresponding conversion rate, as shown here:
3. eLeads
Click Reports > Internet lead > Internet lead reports > Closing ratio and appt totals.
Select your criteria for the report. Choose your date range, and set the Report By as “Source” and the Up Type as “Internet,” as shown here:
Now you can see all the data you need to fill in your sales funnel, as shown here:
Focus Digital Marketing on the Right Customers
A clear sales funnel will measure what works and identify the best ways to focus your marketing and sales efforts. Start measuring now to grow your dealership by attracting more leads or boosting conversion rates.
Ready for results? Even if you work with an approved vendor, we can help get your vehicles in front of interested shoppers in your target area.
Contact us for a custom marketing proposal and get see the difference.
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Jordan Maxfield
As a digital strategist at 9 Clouds, Jordan builds performance-focused campaigns that deliver quality results for clients throughout North America. When she's not at the office, Jordan is watching documentaries or football. Learn more about Jordan.
