Welcome to Digital Homesteading.
This collection of resources from 9 Clouds helps you build your business and community.
Why dealership marketers should think like Warren Buffett
There's no question that with the top-down economics of manufacturer co-op programs, the motto is always “More. More. More.” Dealership marketing managers are familiar with that pressure, but good dealership marketing managers are also familiar with measuring results.
In the past couple of years, marketing budgets in the automotive industry have generally shifted to a 50-50 split between digital and traditional. But if you lack experience on digital platforms and are feeling pressured by co-op programs, deciding how to allocate your marketing dollars can be difficult.
Traditional vs. Digital Marketing for Auto Dealers
Digital marketing is just plain better than traditional marketing, but digital takes a little more maintenance than traditional. Every dealership manager is familiar with producing a TV spot, but very few dealerships actually measure its results, and – more importantly – improve the next TV spot.
This is exactly where digital marketing has the edge. Everything you do online can (and should) be immediately revised, measured and improved. And it's not all about the content. Digital media also involves valuable database insights which reveal the segments of your CRM that are providing the best ROI. From informing the design of a POS poster to the way that a salesperson follows up with a lead, this data-based digital intel can make a profoundly positive impact on your marketing and sales teams. You just need to have the guts to change.
Why dealership marketing managers should think like financial advisors
Your marketing assets are, in fact, assets. Whether it's a full-page print ad in your local paper or a beautiful new competitive landing page on your website, these assets need investment.
As Warren Buffett says, simple things make for stable investments. His extremely successful investment company, Berkshire-Hathaway, is known for buying into timeless institutions such as stores, banks, and insurance companies.
Buffett's rule should also apply to digital marketing. If you use it often – think Facebook, Google, email or even Pinterest – you might want to take advantage of it as an advertising tool for your dealership. Think long-term growth. If you understand the value and function of those platforms, you'll be able to manage it well.
Sure – TV is more commonly viewed than digital platforms, but that's the problem.
Even with the most niche cable shows like Ice Road Truckers, TV advertising is still a broadcast medium that requires a broadcast message. How are you going to curate relevance to an audience that is loosely based on Nielsen DMA ratings that only reveal the general location and age of the general viewership? Where are the insights?
It's difficult to gauge the effectiveness of your TV ad when analytical information is not readily available. An investment in digital media is an investment in clarity for you and it's also an investment in relevant messaging for your customers.
Use your dealership's database to manage your budget.
The key to a successful digital marketing budget is email. With inbound marketing platforms like HubSpot, you can see how many of your email-providing customers are using Facebook (probably all of them), Twitter, or even Google. Combine that intelligence with demographic information (birthdays, genders, marital statuses, etc.), and you have a recipe for brilliantly relevant digital messaging.
Just like your best salesperson, good digital marketing focuses on quality rather than quantity.
Before you decide how much to spend on digital marketing, decide what you want to accomplish. Perhaps you want to:
- Increase average monthly inventory page traffic by 50%.
- Grow conversion percentage by 30%. So, instead of 1 out of 10 visitors filling out a form, you have 4 out of 10.
- Raise your star rating on Google from 3.2 to 4.2.
- Sell 100 more new vehicles to people in XYZ Town.
How much should you spend to reach those goals? Measure it. If you need 100 more people to visit a 2015 F-150 page, you need to figure out where they're going to come from:
- Third-party listing sites (Cars.com, Edmunds.com, etc.)
- Targeted email marketing
- Organic search (SEO)
- Paid ads (AdWords, Facebook display ads, etc.)
- Social media
Long-term growth. Long-term quality.
Successful digital marketing involves delayed gratification. Just like Berkshire-Hathaway, you should think about your ideal customers, their demographics, and how long you want them to stick around.
The not-so-distant future will be driven by today's kids. Sure, Instagram users are a bunch of selfie-obsessed 17-year-olds, but these adolescents are going to be your bread-and-butter clients in 10 years. What brands or dealerships will be at the tops of their minds when they graduate college and start settling down? It's not easy to predict the future of the auto market, but it's clearly not going offline.
Where are your assets?
Does your dealership use the 50/50 model for investing in media? Have other strategies? We want to hear from you in the comments below!
Image: Fortune Live Media
Sharpen your dealership's digital marketing with free digital ebooks from 9 Clouds.