9 Clouds Automotive Marketing Blog

Where automotive meets digital marketing.


Seasonally Adjusted Marketing Analytics for Auto Dealers

It is essential to measure the success of digital marketing to find what works and improve what doesn't work. Too often, however, we mistake increases and decreases with success or failure when it is actually do to something much simpler: seasonality. It's time for seasonally-adjusted analytics.

Finding Hope in the Hopeless

I carry a heavy burden in life as a Minnesota Twins fan. My baseball team opened a beautiful new stadium but for the past decade has muddled along in relative sorrow.

Every spring, however, hope arrives. News stories talk about the upcoming prospect, the fireballer signed from another team or the amazing clubhouse presence of an old veteran. Time and time again, however, the mirage vanishes as quickly as it appeared.

Hope springs eternal because we look for it. When we have our magnifying glass searching for some glimmer of possibility, we will find it, even if it isn't really there.

False Positives in Automotive Analytics

In the automotive marketing world, false positives abound. One of the biggest culprits of false hope and incorrect conclusions is seasonality.

Like many industries, auto dealers have varying success based on the time of year. The dealers that take advantage of our automotive inbound marketing services see more traffic in December than July as a simple example. With tax credits, Christmas gifts and incentives, it is natural to see increased web traffic in December, just as you see increased floor traffic.

This seasonality adds noise to our analytics data. To truly identify success, an automotive marketer needs to account for trends in the measurement. There are two easy ways to cut the noise and find the signal.

1. Cut Seasonality with Year-to-Year Measurement

Most analytics tools and companies measure results month to month by default. This has the downside of reflecting seasonality instead of actual results.

How do you measure without seasonality? 

One way to do it is to measure year-to-year instead of month-to-month. If December is always a busy month, measure from December 2014 compared to December 2013 should show a more accurate growth over time.

The longer your history, the more accurate this becomes.

One note of caution: the internet is growing. I know, a big surprise.

Because of the growth of customers using the internet, there is a natural growth in web traffic. It is hard to separate natural growth from marketing efforts, just as it would hard to separate an increasing number of teenagers with higher sales of compact cars. However, looking at national averages or average across rooftops could give you an average growth number that you should look to beat.

2. Account for Seasonality with Seasonally Adjusted Analytics

What happens if you don't want to wait an entire year to measure your work? Then you need to remove the average fluctuation from seasonality.

To do so, first identify the average fluctuation due to seasonality by comparing traffic from May 2014 to traffic from June 2014, as an example. Then, do the same from May 2015 to June 2015. Look for the percentage change instead of the actual number.

If you find that web traffic dipped 5% in 2014 and 3% in 2015, you could estimate that June on average is 4% slower for web traffic than May. The longer your history, the more accurate this seasonal number will be.

After you have your seasonality identified, apply it to your most recent analytics results. If your web analytics shows that your web traffic dipped 2% from May to June, you can pat yourself on the back. You actually beat the seasonally adjusted traffic. In essence, you grew traffic 2%.

You can imagine how this technique could similarly be used for other metrics such as leads, sales, referrals, ad clicks, digital conversions, etc. Anything measured digitally could be seasonally adjusted to tell you what to consider success based on historic seasonality.

Fewer Unicorns, More Data

Don't rely on natural trends in sales and marketing to help boost your results. Account for seasonality and learn what is truly happening “under the hood” of your digital marketing efforts.

Every spring, I will continue to be tricked into believing the Twins have a chance. Even this year, they are teasing me by playing competitive baseball into the fall. Unfortunately, I'm jaded. I know that true success is a ways off for this scrappy team.

Don't fall victim to false positives and mirages. The actual data is there if you can cut or account for seasonality in your data analytics.

Want to learn more about using data for your dealership? Download our Delicious Data Cookbook. In it, you'll learn key recipes that help you measure marketing ROI, sales performance and conversion metrics. Oh yeah – it's also free!

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Photo: Mario Lapid