When Online Turns Offline

In theory, one of the unique benefits about online advertising, versus print or broadcast, is the ability to fully measure the effect of the ad. You post a listing on a third-party site such as Cars.com, a shopper sees it and calls or clicks, and you have instant feedback that the ad did its job. It’s even easy to run a report that shows how many calls, clicks, chats or other contacts you received off your online ads that day, week, month, etc. Yet those reports fail to tell the whole story. A recent groundbreaking study conducted by Cars.com found that one out of every three dealership visitors who use an independent site will not call or send an email before coming to the store*. So that you’re not missing out on this traffic, let’s look at how you can measure the full value your online marketing efforts deliver.

Think of the Internet as a Launching Point

In the retail world in general, the internet has become the launching point for most shoppers. A July 2008 Nielsen Online study showed that customers at retail giants such as Wal-Mart Stores Inc., Costco and Walgreens consistently spent 30 percent to 60 percent more with them than offline-only shoppers. Many of those customers went online to research product choices and/or availability before coming to the store to make their purchases. These retailers have adjusted their business models to recognize the importance of their online presence, regardless of whether the internet was the channel used to make the purchase.

The same approach is beginning to be applied to automotive sales, according to Dennis Galbraith, vice president of advertising products and training at Cars.com.

“More than 75 percent of car shoppers today use the internet; of those, more than 75 percent use independent third-party sites,” he says. “That’s a huge change in the landscape from 10 years ago. Car shoppers know they can find detailed information about the vehicles that interest them online, helping them become better prepared when they walk into the store. If you’re making all your ROI judgments based on phone and email leads, you’re missing a significant part of the story.”

Look Beyond the Basics

This is not to say leads are not important; they are. Particularly in the current economic conditions, customer inquiries are your dealership’s lifeblood, and driving traffic now is even more urgent than usual. The question is: What constitutes a lead?

One way to measure the true value of online efforts is to look deeper into the reports that third-party sites such as Cars.com can generate. Most dealers will look at how many phone calls, emails, chat sessions, clicks to their website, etc., were generated, while overlooking the hidden indicators.

“On Cars.com you can look at how many customers printed a map,” says Galbraith. “That’s a pretty good indicator that a customer started on the web and then came to the store. Few shoppers would waste the ink and paper to print a map if they didn’t plan to come in. The same goes for car buyers printing a description of the car. Even if it never comes out of their pocket, they brought it with them. So if something they saw on the web doesn’t match what they’re hearing in the store, then they have a way of checking it out. A print-out on the front seat of the trade-in vehicle shows they did their homework well before walking in the store.”

Embrace Online

With that in mind, it’s important to understand the difference between using online advertising and really embracing it. For example, a dealer that is using online advertising will post a photo, a basic product description and the MSRP for a new vehicle or the Blue Book price for a used car. A dealer that embraces online advertising, says Galbraith, will post multiple photos, and/or a video, a detailed product description, a free vehicle history report and a price that’s competitive in the marketplace.

“The change dealers have to realize is that merchandising vehicles online isn’t advertising in the traditional sense. It’s selling,” he says. “The sales process now begins before the customer ever sets foot in the door. You need to approach the customer experience like you would on the floor, providing ample information, leading the customer through, highlighting important features and selling the dealership.”

If you’re still not sold on the impact, consider that half of dealership visitors who used Cars.com before coming to the store plan to purchase or lease a vehicle that day. Leads don’t come any hotter than that.

Still Skeptical?

Of course, not everyone has bought into this new business model. Some general managers remain focused more on branding efforts using traditional media (e.g., TV, radio or newspaper) because it’s what they grew up with and where their comfort zone is. In addition, Galbraith says some will try to minimize the connection between online marketing and offline sales as a negotiating tactic.

“It’s really time to stop playing that game,” Galbraith says. “Dealers should start working with their salespeople and figuring out how to get more out of it instead. It’s easier to see what the results are than it is with TV, radio or even newspaper ads. Online marketing has proven itself to be the most effective driver of traffic to come along since the invention of the automobile. Investing in it is really an investment in the store.”

Additional Resources

To learn more about the walk-in study Cars.com completed with Synovate, please visit the DealerADvantage Live archives. Galbraith discusses the innovative study and how you can leverage online advertising to drive more walk-in traffic.

* Value of Third Party to Dealer Walk-In Traffic; Synovate 2008

One thought on “When Online Turns Offline

  1. Yet another study to support the fact that automobiles shoppers follow the rest of the universe in online activity. Those clinging to traditional media at the expense of digital options may one day have little to do but read the papers. We do however, benefit from awareness that like your service drives traffic to the dealer. Does it pay for itself? Who knows? It’s impossible to measure with any level of confidence. But these sources also conduct internal studies that justify the expense of their services, generally better received when conducted by a disinterested third party. The findings produced by any party with a vested interest bring back visions of the tobacco industry. And you are not alone; AutoTrader uses the same arguments to support their fees.

    The number of dealers paying for leads clearly shows a willingness to pay for traffic; phone, internet, floor, and whatever. Since the Internet offers the ability to measure results with confidence, the lead provider that produces a positive ROI – on Internet leads alone – is best suited to the needs of the dealer. Further, the dealer and the lead provider then find such internal studies unnecessary, providing the dealer time to focus on selling and the lead provider time to focus on generating leads.

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