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AUTOMOTIVE BLOG & NEWS

Optimizing Dealership Advertising: Facebook vs. Google

Dealers are increasingly investing in online advertising, with a whopping 68.2% of dealership ad budgets allocated to digital platforms in 2022. While Google leads the online advertising arena with $238 billion in revenue in 2023, Facebook trails behind at $132 billion. To put this into perspective, the combined revenue of TV, radio, and newspapers amounts to only $97.35 billion.

Despite Google's dominance, automotive dealers often prefer Facebook for their online ad spends. This preference may stem from the ease of starting advertising on Facebook, the herd mentality of following industry trends, and the widespread use of Facebook among the general population.

However, Google advertising offers distinct advantages, despite its complexity. While Facebook excels in generating top-of-funnel leads, Google's search-based approach yields higher conversion rates. As a Facebook and Google Partner Advertiser, we leverage both platforms equally, utilizing Facebook for top-of-funnel leads and Google for customers actively seeking automotive solutions.

Ultimately, success in advertising on these platforms requires more than merely placing an ad; it demands a refined process to convert leads into customers. While each platform has its strengths and challenges, both are indispensable for effective dealership advertising.

In conclusion, both Google and Facebook offer unparalleled opportunities for dealership advertising. While initial success may be elusive, experience breeds improvement. Adaptation to the evolving landscape of online advertising is key, ensuring that advertising dollars are invested wisely. Neglecting the potential of online advertising or dismissing either platform prematurely is a costly mistake dealers cannot afford to make.

5 Reasons to Outsource Your BDC

Are you thinking about starting your own BDC department? A successful BDC is worth its weight in gold. So where do you begin? Do you create your own BDC, or do you outsource? Well, we hope you consider outsourcing. There are pros and cons to both, but we feel the pros of outsourcing outweigh those when considering an in-house BDC. Here are 5 compelling reasons to consider outsourcing.

Hiring and Training

It’s common knowledge that if you’re paying a company for a service, you don’t have to search for staff or train them. Hiring good BDC agents is always a challenge, especially agents that speak more than one language. When you outsource your BDC, this headache disappears. And the only type of training you will have involves your dealership particulars. You can simply inform the BDC service provider of any requirements, restrictions and or scripts you may have, and let them handle the rest. Training becomes a non-factor by outsourcing.

Cloud Contact Center Technology

You will need call center software which is not inexpensive, and usually charges by the seat. Focus along with a few other outsourced BDC service providers utilizes inContact. Because of our long relationship with this company, we can attest to the fact that they’re the leader in cloud contact centers technology.

Availability

Your outsourced BDC department will answer calls for you based on the hours you’ve determined. Another plus of an outsourced BDC service is the ability to handle calls off hours. You do not have to worry about an employee calling in sick, or having your employees sitting idle. Your leads will not to go to waste this way. We all know the faster you speak to a lead, the higher the chance they will convert.

Cost

The major benefit of outsourcing is the scalability factor. Your budget with outsourcing will coincide with the volume your store gets, and the goals for the store. Overall, without the many factors like training and software, it is much more cost effective to outsource.

Risk

The risk/reward relationship is relatively lower for outsourcing rather than creating an in-house BDC service. The only risk you take when outsourcing is the cost and quality of the service. As with any other 3rd party vendor you may be utilizing.

If you don’t already have a BDC department, it’s not too late to get started with one. There are two options available when adding a BDC service to your dealership, but it’s up to you to decide the amount of work you’d like to put into the program. If you’ve managed to save up the capital and have a dealership large enough to work, then you might consider an in-house BDC program. However, if you’re like most other dealerships and want to get the perks of a BDC service at a lesser investment, outsourcing with a company like Focus might just be your best bet.

Advertising You Can Measure is Advertising That Works

I’d be willing to bet that most car dealers think advertising is a completely different animal than what it was just three years ago. If I were to ask 100 of the same dealers whether or not they have decreased their advertising because of this, nearly all would agree.

However, they would all be incorrect about the first point and making a mistake about the second.

While it’s true that many dealers are spending less on advertising, I can tell you that advertising still works just as well today as it did three years ago. I know this because I’ve seen it with my own eyes working in the auto consumer market. The cost of generating a lead has not changed. In fact, within the past three years, generating leads actually became less expensive.

Without a doubt, the key to knowing this is to measure your advertising results. Focus measures advertising effectiveness the same way it was done eight years ago. Because of this, we can compare our advertising results historically for that entire period of time.

Unfortunately, eight years ago car dealers did not care about the cost per lead or measuring the effectiveness of their advertising. That means they have no real way to compare today’s advertising to that of the past.

So how would you know if your advertising is not working as well as it once did? Many make the argument that advertising effectiveness is diminishing because your cost per car sold is going up. Yet, I don’t believe that cost per car sold is an effective way to measure the historical differences of advertising.

Of course cost per car sold is going up; less people are shopping for cars so you will get less walk-in traffic, which is essentially free. On top of that, now it’s more difficult to fund a deal. If you turn away 20% more people now than you did three years ago because you can’t get them financed, what else would you think will happen to cost per car sold? There’s nowhere for it to go but up. So, unless dealers have some type of measurable comparison, they simply jump on the bandwagon that advertising is less effective without any real proof.

The second part of this is the critical mistake many dealers make by spending less on advertising. Dealers spend less because they sell fewer cars and see bad advertising as the reason why. This is an endless cycle that ultimately gets you nowhere.

I’m not arguing that there are less car buyers in the market today. Statistics have proven that. However, the numbers also reveal that there are fewer dealers out there and those dealerships still in business are spending less on advertising. You’ll also find that the dealers still spending money on advertising are the ones selling cars.

I know the argument. “Of course those dealers can afford to spend money on advertising –they’re the ones selling cars! I can’t afford to advertise because my sales are down.” I find this to be a very poor argument. The truth is that they have no idea what effect their advertising has on sales and they never really have. It is only recently that car dealers are even concerned about advertising results since major companies like Google have turned their tracking systems into multibillion-dollar businesses.

Even though Google has made everyone more aware about measuring advertising results, most car dealers only do this part of the time because they feel like they can get away with only measuring certain forms of advertising. This is not the case. You can, and should, measure all forms of advertising.

How do you do this? The most effective way to measure advertising is by generating phone calls. If you use print, the customer can bring in an ad. Filling out a form on the internet is another method. What does not work at all is asking a customer where they saw your ad. I cannot tell you how often I hear that this is the advertiser’s ad measurement tool. It is not the customer’s job to measure your advertising. If you can’t figure out how to measure the effectiveness of a certain medium, you should not be using it unless you simply don’t care if it works or not. If your goal is something other than selling cars, then go right ahead and spend the money.

I have always told my media buyers that there is no such thing as a bad time period or ad space. All advertising WILL work if you pay the right price. Yet, unless you can measure the results, you really have no idea whether or not your ads work.

Don’t let the failure around you deter you from your true mission – to sell cars and make a profit. Make your advertising count. You cannot afford to waste money. Before using any medium, ask yourself “Can I measure the response?” Before placing an ad, ask yourself “Why would a customer respond to this ad?”

Direct response is the key to your success, not just because it is measured but also because you take that customer one more step. You get them that much closer to buying by motivating them to respond. Keep advertising – do it the right way, and you will succeed.

How Car Dealers Can Increase Profit by 25%

How can you confidently put money into an ad if you have no way of tracking its success?

That’s where direct response marketing plays a valuable part.

Direct response is a simple technique but can result in wasted time and money if not done right. The premise of direct response is to develop a relationship with potential customers by giving them a concrete offer, providing a sense of urgency and most importantly, giving them a clear avenue to contact you. To help you navigate direct response in the dealer marketplace, here are a few things to know:

1. Branding will never do it alone

While your brand plays an important role when it comes to customer’s perception of your company, direct response is the ideal process for quick sales. Your concrete (and appealing) offer is what will drive responsiveness; your brand will keep them coming back for more. With that said, your sales message must always reflect your brand, thus increasing credibility and making the offer an even sweeter deal.

2. Direct responses are immediate and trackable

By providing each medium with a unique identifier, you can track the exact ad they responded to, what the message was and determine the effectiveness of your promotions – something branding and other mass marketing are unable to provide. Not only is this process instantaneous from the moment an ad is clicked, a form is filled out or a phone call made, but it allows a faster conversion of prospects into customers.

3. You can test your success – and make adjustments as you go

Since direct response can be relatively inexpensive compared to other types of advertising, you can conduct test campaigns in smaller areas and then take those results to immediately start working on a more responsive and more successful campaign. The immediacy of direct response allows you to always be testing different messages.

What is there to inspire a customer to find out more, and how would they even do so?

4. You can zero in on a specific type of customer

Unlike branding techniques that send your message to the masses who may or may not be interested in your offer, direct response materials can be directed to a specific market or type of customer based on the demographics you select. It is also essential to know what these demographics are; if you don’t know who your target audience is, then any offer you put out there is going to fall flat.

5. Every dollar invested in your marketing efforts is accountable

In a successful campaign, a minimum of 25% of your media will not be successful on any given day. If your money is invested in a branding campaign, then there is no way to identify which 25% that is. Measuring the effectiveness and performance of your campaigns will allow you to find out where those dollars are wasted. 

The Art of Being a Credit Counselor

When the time comes to tell the customer sitting across your desk that they are not approved for a loan, you will have to treat this delicately. The best approach is to show them their credit report. Show them the negative information, their credit score, and explain their score factors to them.

Every credit report contains four score factors, ranked in order of importance, which are the reasons your credit score is what it is. Explain these reasons to your customer one at a time and tell them what they need to do to improve that situation.

You will need to provide resources that the customer can use to educate themselves. In a survey conducted by LendingTree, nearly 60% of all consumers don’t even know their credit score. It is not surprising that the vast majority of these customers have severe credit issues validating the fact that education is the first step to having good credit. Your customers can get the information at various sites including the sites of the three credit reporting agencies, MyFico.com, and Experian.com.

I always find it helpful to turn the tables on the customer and show them how they would evaluate someone trying to borrow money from them. Your credit report is nothing more than a snapshot of your credit life that allows creditors to make risk assessments for the money they lend. Ask the customer to think about what they would analyze if they were to loan money. Then walk them step-by-step through the process.

The most important thing to look at is their payment history. How do they pay their bills? Do they have a history of late payments? Your payment history accounts for 35% of your credit score. Ask them if they would loan money to someone that has accounts that are past due? Use their late payments as an example. Explain to them that any late payment is bad. In fact, the difference between someone with good credit and someone with bad credit is as few as five late payments over the course of one year.

The second most important element is the amount of money that you owe. It accounts for 30% of your credit score. This usually is a reference to revolving credit, or credit cards. Your goal is to never to carry a balance exceeding more than 30% of your credit limit. Explain that banks consider this important because it shows a creditor that you have an ability to manage your bills. Ask them if they would loan money to someone that was making minimum payments on all of their credit cards because they are having problems paying the bills they do have.

Fifteen percent of your credit score is attributed to your length of credit history. Someone with credit for ten years is a better risk than someone with credit for 10 months. The last two factors account for 10% each and they are type of credit you have – your credit mix and new credit. How many of your accounts are new or recent? Too much new credit shows creditors that you are desperate for credit. Again, making the customer see the it from the creditor’s perspective is important for two reasons. They can relate with the creditor and they can better understand what they have to do to improve their own situation.

Once you get their attention and make them care about credit will be the time you can start the education process. Because if they don’t care, they won’t do what it takes to help themselves. It will also be about this time that they will realize that you are trying to help them. Some people still won’t care and you will never be able to help them. The people that do realize that you are trying to help them will be your customer for life and the ones motivated enough to stick with a program. But they will still need your help.

In conclusion, your success as a credit counselor will depend on how educated you are on the process. I urge you to visit the sites discussed in this article. Helping your customers succeed will put you in a position of power over your competition and you will sell more cars as a result.

The 4 M’s of Marketing – How not to waste $12,000 in advertising this year

ver the years, I have focused on what happens at a dealership. Topics like how to maximize your ad dollars, how to get the most from your customer database and how to differentiate yourself from your competition in the customer’s mind. All of these issues have a direct impact on your sales this month.

Yet what I have come to realize is that dealers are so busy making a living that they don’t have time to focus on making money. By this I mean that a dealer’s main goal is to sell cars this month without any consideration towards next month, next quarter, or next year. I sense there is a great deal of pressure to achieve short-term goals but I believe you can still reach those goals while planning for the long term.

Because of this, I’m going to explore the four M’s of Marketing – measure, manage, master and multiply. These are the four steps any company must accomplish before they can gain the kind of success required to be a leader in their industry.

MEASURE
You cannot manage what you cannot measure. You cannot master what you cannot manage. You cannot multiply what you can master. I can apply these principles to any segment of a business, but today let’s focus on advertising dollars.

Car dealerships, according to NADA, spent an average of $49,165 dollars on advertising in 2014. Best case scenario, these dealerships wasted $12,291. When many dealerships across the U.S. are struggling to make a profit each month, this amount can no longer be overlooked. I’ve said it before and I’ll say it again: over 50% of all the money you spend on advertising, at a minimum, will not work. Unless you implement proper measurement tools, you won’t even know which 50% is being wasted. Measuring your efforts is the first step toward successful marketing.

MANAGING
Once you’re measuring your advertising efforts, then comes step 2 – managing. Pretty soon you’re going to know exactly what advertising generates a response and what fails to do so – what do you do with this new information? With this knowledge, you can now make your initial adjustments. From entire campaigns, to stations, to time periods, you’ll know right away what works and what doesn’t. Cancel what doesn’t work and buy more of what does. Then, keep observing.

MASTER
If you know what you’re looking for, you will get very good at predicting campaign results before you even begin advertising. It’s at this stage that you’ll really start to get good. With that said, I offer this disclaimer: advertising results change every day for many different reasons. So while perfection is out of the question, this is the stage I would consider taking the time to master.

MULTIPLY
The final stage, multiplying, tends to be the most intimidating for most people. Every client that I have worked has been wary of increasing their advertising dollars. The reason tends to be because they don’t fully understand the other three principles. Multiplying is the easy step – all of the hard work has already been done. I can’t tell you why consumers respond the way they do, but by this step I can predict the level at which they will respond. If you follow these steps, you will too.


Does your Advertising Agency Understand Your Dealership Bonus Plan?

All manufacturers offer incentives/bonus plans to their many dealerships worldwide. Because of this, the GM’s, FM’s, and sales teams alike aim to hit their monthly, quarterly, and even annual quotas to obtain them. Your ad agency must be familiar with your plan and what is needed from an advertising standpoint to reach your goal and maximize your bonus payout. Missing a particular goal by one car can possibly cost thousands.

The origins and increase of these incentives are due to declining margins for new cars. The other reason is tied to the customer experience and improving this aspect of the dealership. Retention is first and foremost to increasing car sales, but often the most overlooked. The service department is slowly becoming an integral part of boosting new car sales.

Maximizing your bonus payout is key to also minimizing or eliminating your advertising expenses. Let’s just assume that a manufacturer offers each franchise a certain amount of co-op money for advertising, and that’s $15k (if you reach a vehicle sold threshold). Imagine your dealership matches that with another $15k out of pocket (total of $30k invested now), meet the quota by selling 30 vehicles, and attribute 40% of those sales to your agencies help (12 vehicles). If the manufacturer offers $2,000 per car sold (past the threshold), you’ll obtain $24k for the vehicles sold by your ad agency. Subtracting your initial $15k investment from the moneys that the manufacturer will be rewarding your dealership with, you’re left with a $9,000 profit from selling these additional vehicles with your agency’s help. If your ad agency is not working with you closely on understanding the “bonus math”, you could be at risk of missing out on some serious profit.

Besides fully understanding the numbers and quotas, sound advice should also be a main constituent. If you’ve tapped out on your ad spend budget, the month is coming to a looming end, and you haven’t met your goal, you should expect your agency to be watching and offering advice to help you get there. An agency that truly cares for your business understands that the value of fine customer service is priceless.

The primary goal for the agency should be to help you sell more. It’s as simple as that. What sets the better agencies apart is when they understand the bonus programs (which change month to month for some dealerships) and offer exceptional customer service. These two things coupled together should put you and your ad agency on the path to more sales and a better business relationship.

5 Free Things to Increase Your Website Conversions!

Yes, you can pay for tools that take care of the job at hand with minimal effort, but sometimes you just don’t have the funds available to get these pricey tools. So, here’s a small list of 5 things that you can start doing today that will organically increase your website conversions.

Go with the flow
To better understand what I’m referring to, quickly go to Apple.com (no seriously, go right now to see what I mean). Their site is overly simplistic with just enough info on each landing page to entice viewers to click and learn more. The key is to not clutter your homepage with unnecessary info because potential buyers will become overwhelmed and exit your landing page.

So how does one make their landing page even more simplistic, you may ask? Start off with having a single picture of each car (top selling car at the top/first) on the home page. Next to the picture of each vehicle, only place the name of the vehicle. Hopefully this will entice the potential buyer to click, see more pictures, and learn even more details like the starting price and model trims. From there, the only main CTA you need is something to get them to see your inventory, which brings me to my next point.

Make the CTA (call-to-action) straightforward
I’ve seen many websites fail at having way too many CTAs on their web pages. Dealers may have over 10 CTA’s on one page such as “get a quote”, “sign up for our newsletter”, or even “meet the staff” all on one page. You’re giving your prospect too many options. Each landing page should have between one and five CTAs. Each page pop-up should have one main CTA. You should not have any landing pages on your website that don’t have a CTA. After all, a CTA is how you generate leads for your dealership.

Test, Test, and More Testing
People read websites by their headlines and sub-headlines. Therefore, if you really want to grab their attention, you’ve got to have them curious and wanting to see read what’s under the hood (or headline in this case). The key to getting great at this is testing. Never assume that your headline is a “banger” and that people will love your humor or think it’s an interesting headline. Change it up and test it out to see if people are clicking. Some websites even offer heat maps to see where your viewers are reading and clicking. Optimize your landing pages by testing your headlines.

 “Fill this out form out for me please”
So how on earth will you know if your CTAs are working for your site? You’re going to need forms. These can be a little tricky at times to create, however. We’ve seen dealerships get desperate to find out all the info from a prospective buyer, which then turns the buyer off from your website. It can feel a bit overwhelming with a form that’s long. Shorten the form to 4 main components:

FIRST NAME
LAST NAME
EMAIL
PHONE NUMBER

With these 4 components you can get everything else you need out of the prospect at a later time. A study done by Unbounce proved this point when they tested it with a company that had too many fields. The company previously used 11 fields, and tested out only using 4 fields, and they witnessed a 120% growth in conversions. We’ve tested the form situation out with two of our prospect’s landing pages (one with a form requirement to see inventory and the other without a form requirement to see the inventory). The website that utilized a form had a 72% website conversion rate compared to the 2.5% conversion rate from the website without the form to see inventory. This is possibly the easiest method to do that can you ensure you higher conversions.

Add a face for familiarity
This is possibly the quirkiest method but I swear it works! When a blog post, web page, or even video has a real face in it, it creates a sense of relate ability. So for your dealership’s website, try and include pictures or videos of people of all races and genders. Show the entire buying process, if possible, to subconsciously encourage your prospects to purchase from your dealership. As an added bonus, include a picture of a pet in the car as well. According to an Autotrader article “sixty-six percent of dog owners think about their dog’s needs at least a little when shopping for a car.” And speaking of pets, maybe even mark your dealership as “pet-friendly” on the website.

Remember, nothing here is 1000% guaranteed to work, but from our experience helping dealerships, these changes will make a difference given the amount of work put into it. We’re interested in knowing if any these changes end up helping your dealership. So, comment down below 1 month after you make some changes and let us know if you’ve seen any difference in your conversion rates!

A Quick Guide to Marketing Automation

What is it:
Marketing automation is the utilization of a software to efficiently send out marketing content. Content can range anywhere between emails to prospects all the way to a social media post to all your marketing outlets.

Why you should care:
The life of a marketer is simplified with the addition of a marketing automation tool. Marketers can now schedule the repetitive posts far in advance to make time for other things later down the line. Some of the marketing automation tools can be integrated with CRM tools and with your website as well.

How will it help:
Creates an efficient workflow
Increase in the personalization of message production (lead nurturing)
Plan and execute thorough marketing campaigns
Provides measurement and engagement analytics

Pricing:
Marketing automation tools can range anywhere between $1,100 – $50,000 per year. Price will depend upon the extensiveness of your marketing scope and the features of the tool you utilize. Another factor to think about when choosing a marketing automation tool is if it’s a “best of breed” (good at just one thing) or “fully integrated” (has a broad range of capabilities).

Questions to ask when looking for a marketing automation tool:
Are there any guarantees? – investigate to see if what you need the tool to do is backed by some guarantee
Will it work with what I’ve got in place? – find out if the marketing automation tool integrates with the tools and apps your company is already utilizing
What’s the payment plan? – determine if the service is a onetime fee, monthly fee, or a pay per action service
 
Should you utilize a marketing automation tool? More than likely, yes. Don’t continue to overwork yourself as a marketer. Search for the best marketing automation tool for your business today and begin to work more efficiently!

4 Reasons to Use an Agency to Purchase Media

Are you thinking about buying ad space for your dealership directly from the source? Have you assured yourself that it’s the only way to go? I mean, you’ll save money on the agency commission, and how hard can buying a commercial here and there really be, right? Unfortunately, this “economical” tactic might be the exact opposite. When you buy direct, you’re likely going to lose money…and a lot of it, if you’re not careful. Most of all the successful dealerships hire experienced and reputable agencies to handle their media buying, rather than going direct. We’re here to help you understand why.

The Money: Television advertising is priced on a Cost per Thousand (CPM) basis, which is the cost for 1,000 impressions, or 1,000 people to see your ad. So, if the CPM in your local market is $25.50, and you want 250,000 people to view your ad, then your total ad spend will be $6,375. 
(250,000 impressions/1,000) x $25.50 CPM = $6,375

Fairly simple, isn’t it? Well, not exactly. When you request rates from TV stations in your area, how will you determine if the given rates are fair? Unless you have years of historical data, have spent every day building rapport with station executives, and have deep-rooted industry knowledge, you won’t know what an acceptable rate really is. 

Placement: Do you know when to advertise? Do you know what rotations to buy, which day-parts to air in, or the ideal separation between spots? Do you know how to calculate ratings? Do you know your target audience, how to reach a certain demographic, or which stations will be most effective to advertise on? These are major players in the making of a successful media buy. If you buy direct, you will likely air in the less desirable times throughout the day – where the station has the most inventory. Agencies have the insight and leverage to make sure that your message gets delivered to your target audience within the most effective time frames, in turn increasing overall return on ad spend.
 
Long-Form VS. Short-Form: This is wholly subjective to your line of business. Because we are experts in automotive and specialize in the subprime market, we’ve learned a couple things to go by.
Long form (30 minutes) Short form (60 seconds)
Booking Difficult Easy
Times Pre-determined times & dates;
2 week cancellation policy

Frequency determined & placed within specified time frame;
2 day cancellation policy

Results (ROI) High Low-Moderate

Over 10 years of testing, this method has proven true and consistent for us. There are still other factors that go into the comparison of the two types of advertising like the production of the spot and the call-to-action within the commercial.

Convenience: Buying quality ad space is not a “set it and forget it” business activity. To run a successful campaign, you must constantly monitor, analyze, and optimize the buy. Not to mention, once you buy from one station, you will have every other station in the market calling and showing up at your business trying to sell you something. With an agency, you can set it and forget it. Let the agency do their job of taking the calls, negotiating the deals, and handling all the trivial things that go into buying media. This allows you to focus uninterrupted on your day-to-day business activities. 
 

Agencies are home to seasoned marketing specialists, data-driven analysts, creative strategists, and at the root of it all, experienced media buyers. They have the costly software, analytics, and necessary tools to maximize your return, monitor your investment, and spend all day working to optimize your results. Work smarter, not harder – and improve your overall numbers at the same time. Once you realize the value in hiring an agency, you’ll never consider buying direct again. 

How to Manage Leads in a Challenging Location

A problem that a select few dealerships run into is their distant proximity to the leads they receive. Some dealership owners believe that it’s not even worth the trouble of working these leads. However, with the assistance of technology and a little brain power, you may be able to come up with an uncommon process. Here is one unique way one client dealt with this issue.

Many of the dealership’s leads are 45+ minutes away. Now common sense will tell you that these buyers will look for a dealership that’s much closer than 45+ minutes away from them. The GM of the dealership understood that if he could get these leads into the dealership, he’d have a great chance of closing the leads with his well-trained sales team.

Problem #1 to tackle is knowing whether the lead will be qualified. It’s difficult to offer a deal without knowing their credit history, however, this manager and his team decided to create an online survey as a fast and easy method to qualify leads before they even step foot in the door. Now comes the interesting part of this dealer’s story: to get the now qualified leads into the store, they devised a plan to utilize Uber to literally “drive” in distant, yet qualified, leads. The trip to the dealership from about an hour away would cost the dealer on average $100; which is just a fraction of what the dealer will make after selling the person a vehicle.

Over time, this dealership has seen a great increase in sales. This interesting method is a sure way to show the customer that you truly want to get them in a vehicle and that you believe in unprecedented customer service.

Leave a comment down below letting us know of an interesting way your dealership drives in more leads.

The Hispanic Consumer As A Car Buyer

The Hispanic Consumer is a Better Car Buyer

Beyond just the sheer size of this demographic, Hispanics can be a better car buyers. Why is that?

Household Income

Hispanic household income has increased 4.3% in the past year, the 2nd highest increase in any group. Their average household income now averages or exceeds $75,000.

Neilsen has found that in Houston for example, the largest growth in the wealthy communities are young Hispanics that are now making over $100,000.

Car Buying Trends

The average age of Hispanics is much younger than the non-Hispanic white population on average (30 vs. 42), which means they could potentially buy more cars over their lifetime. This translates into a higher lifetime value as a car buyer.

They also tend to buy more new cars, because they frequently pass them down to other family members. And many opt for luxury brands. For example, one out of every five Lexus IS’s sold was purchased by the Hispanic demographic.

What are some other buying habits that set the Hispanic car buyer apart from other demographics?

Well, Five Times as many Hispanics that are buying a car, are buying for the first time.

And, on average they have a higher amount for a down payment. Most put down more cash, and finance less. The average down payment is close to $5,000. The average MSRP of vehicles purchased is nearly $30,000. 

And, Hispanics tend to lease cars about 30% of the time.

In many respects, these numbers are very similar to non-Hispanic car buyers. The biggest differences are in the first time buyer category, and the average age of the buyer. The Hispanic demographic percentages are much higher in both of these categories. New car sales is expected to increase among the Hispanic demographic, while other groups actually decrease.

This is probably the most important fact to consider when deciding as a dealership how to proceed with a marketing strategy. Now more than ever, targeting the Hispanic car buyer should be a priority for your marketing department, or any company you choose to hire for your advertising. If they do not address this buyer in their strategy and/or presentation, move on.  

Overlooking the Hispanic car buyer will only result in lost sales now, and over time. Family members often accompany these car buyers, and they tend to be very loyal consumers.  

As mentioned earlier, having the right advertising in place to target the Hispanic car buyer is very important. In out next post we will discuss specific marketing tactics for this demographic based on their shopping habits.

Focus can help you with both ad creation for the Hispanic demographic, or if you just want leads. Reach out to me and we can talk!

Get Millennials to Buy From Your Dealership

Let’s talk millennials. It’s the fastest growing generation which means they’ve got loads of buying power. Dealerships don’t have any issues selling to the millennials between the ages of 23-34, because they’re deemed adults with buying power. But what about the younger generation of millennials between the ages of 18-22? How do you perceive them when it comes to selling them a vehicle? It would be wise to focus on this subset of the millennials because they’ve got buying power but just need a to be guided towards something that meets all their needs at the right cost.

BEFORE THEY GET INTO THE DEALERSHIP
Advertisements: All advertisements NEED to have images or videos of buyers their age of all races. Try and appeal to every gender and race in your advertisements. When it comes to the placement of your ads, I would suggest using Facebook, Instagram, and Facebook Audience Networks. Millennials are always on their phones, so attract them where they’re normally looking.
Message: Appeal to them with funny and relatable content. You can utilize topics such as current social events or even animals like puppies (everybody loves a good pup).
Offer: The normal thing for a dealership to do is offer rebates. However, it’s time to let your creative juices flow and come up with an even better offer that relates to them. My idea is to offer the person a scholarship using the rebate money. This idea leaves students happy and parents even happier.

WHEN THEY GET INTO THE DEALERSHIP
Sales Team: Nine times out of ten, they’ve done their research and know what they want and around how much it’ll cost them, so try not to make up some outlandish price to increase your commission. Another tip is to gauge their interest as the process goes along and become as relatable and genuine as possible. You should maybe even relate to the parents in some cases because they may be doing the purchasing.
Freebies: You never know what kind of day the person has had, so offer them a bottle of water, coffee, food, and even the Wi-Fi password. Just these trivial things could appease a buyer and help you to sign a $25k contract.
Fixed Operations: Offer services like FREE car washes and oil changes towards the end of the transaction. By doing this it appears it’s an exclusive gift to them and it helps to build your rapport with the client.
Benefits: The main selling points may vary by genders (the stereotypical speed for males and reliability for females), but you can generally sell all millennials on connectivity and technology of the vehicle (i.e. Bluetooth compatibility).
 
AFTER THEY PURCHASE FROM YOU
Follow-up: You need to reach out to the millennial driver within the first week via phone call. Ask them how the car is holding up and if they’re enjoying it. This courtesy call makes your dealership appear as though you sincerely have a customer first mentality.
Campaigns: Set up email/text campaigns for things like FREE car washes and oil changes. DO NOT pester the client however. One text/email every 3 months should suffice. Have a second campaign going around the time when the lease will be coming to an end.
Rewards: It is crucial to have a referral system in place. Your new buyer will be happiest with their purchase on the day of the purchase, so ask for referrals then. And as any good referral system works, you should reward the new purchaser once the referral converts. If you’d like to go the extra step, your dealership can create a customer loyalty program that is compatible with an exclusive app to your dealership. They can earn points which in turn will be redeemed for rewards from your dealership.
 
IF THEY DON’T PURCHASE FROM YOU
Call: Within the first week, it’s crucial to reach out to the person with either a better deal or an incentive that will make the price sound more appealing.
Email: If the initial phone call is unsuccessful, you should add the person to your dealership’s newsletter list so that you’re always be at the forefront of their mind.
 
It’s evident that the millennials are increasing their buying power year after year and it’s best that your dealership capitalizes on marketing to them. I hope that the ideas above have sparked your interest with new ideas or encouraged you to hunker down on what processes are already in place. If you need more help with your marketing efforts towards the millennial buyer or any other subcategory of buyers, feel free to give Focus a call.

4 Ways to Get More Car Sales Leads

Your sources for car sales leads are vast. You are solicited constantly with the next best way to get a car buyer. So how do you pick the best source or combination of sources that work for you? Well, this decision is based solely on your internal business process for handling leads, and what type of customer you choose to target. Having a really good feel for both of these is necessary or your leads will be wasted. We have found that if a car dealership focuses on an effective process for their handling and/or generating leads, they will sell more cars than the competition.

Need more car sales leads? The best way is to advertise, or buy leads directly.

If you are a franchise store or an independent store with an advertising budget, paid advertising is probably the number one way to generate more car sales leads. Again, your process for handling these car sales leads will tell you if the cost is worth it. Buying leads and skipping the advertising is also a good option. Doing both is most beneficial, and can give you a good idea as to what works the best with your dealership and process.

TV Advertising

The most expensive to buy and not easy to measure, especially, if commercial does not have a call to action, i.e., call now, go the website, etc. For franchise dealers co-op funds usually cover the expense, but if you do not know if it is generating a customer, what good is it? Branding, maybe? You can achieve that with less expensive methods. Cable channels and OTT ads are low cost, but we have found that lead generation numbers are low, probably due to lack audience in the streaming community. And for this type of advertising, you will need an experienced media buyer. This is key or these dollars will be wasted.

Digital Advertising

If you are not dedicated at least 50% of your advertising budget to this medium, you should be. Lead generation online is cost effective, and reaches more audience than TV, and this tread will more than likely continue. It is also better for targeting and measurement. In other words, just more flexible. And there are so many choices, which will warrant another post to address this topic. You can do this on your own if you have the staff (marketing department). Or you can hire an agency with a proven track record. Word of caution: if you decide to advertise your inventory, make sure you can track activity. Some of the big guys direct traffic to bigger fish leaving you hanging.

Radio Advertising

Still an effective way to advertise like TV, and audience reach is really good. It is expensive, but some ad agencies sell quite a bit of radio and their customers sell a lot of cars. My issue with radio is like TV, in that you cannot directly attribute the lead to the radio commercial unless you screen all your customers. Some car dealerships just like the increase in sales and do not care. This type of advertising usually requires an agency to get the best rates and to make a really good ad. Radio stations like TV claim they can do this for you, but I would not recommend it. If you are going to spend money on radio, make sure it works.

Third Party Leads

Lead generation companies for car sales are numerous. They can be a good choice for boosting car sales. Again, success with these leads depend on many factors. The type of lead is also a factor. These leads can be generated by all of the above mentioned paid ads. You are just passing on this responsibility to someone else, and just receiving the lead that you can hopefully convert. There are two different types of car sales leads, so make sure you buy the ones that will work best with your goals and processes.

Subprime Leads

If you serve the consumer with less than perfect credit, these leads can help you sell more cars. Working these leads does take effort, but if you have a good process, lenders, and inventory, you will be successful. Focus generates more subprime leads than any other provider, and our customers are having success.

Prime Leads

These are often called internet leads, but there are others, such geotargeted leads, facebook leads, or inventory leads like the ones sold by Autotrader or CarGurus. These leads are the most desirable, but hard to obtain in any type of quantity.

No matter what route you choose, you will need an agency to help you unless you have fully functioning marketing department. You will also need a lead provider. We are the only agency (we know of anyway), that sells both advertising and leads. Let us know if we can help you increase your car sales.

3 Things to Know Before Setting Up a BDC/Call Center

Your dealership is currently experiencing one of two scenarios: overworked sales people or under worked sales people. Luckily, one addition to your dealership can help with both dilemmas. I’m sure if you don’t already have a BDC, it’s most likely crossed your mind to implement one. You may have even begun talks with your staff to build up a department already. Before you begin, however, there are three main things you need to consider when setting up a BDC.

 Financial Commitment
Most BDC employees are paid on an hourly base. Depending on your state, the pay usually ranges from $10-$20 per hour. As an extra incentive, a commission should be given for each qualified person that shows up for an appointment. Going even further, a bonus can be awarded to each BDC employee that reaches a certain quota of qualified appointment walk-ins per month or quarter.

Once you’ve figured out how much it will cost to staff the place depending on the volume of sales your store does, you have to budget for the necessary equipment. Your sales people will need phones, headsets, computers, and the necessary software to take the calls.

Staffing
After interviewing a BDC manager, the top 3 characteristics that a BDC employee should have:

Aggressive
Direct
Patient
The first rule of hiring a BDC staff is to employ from outside the dealership, not within. Look beyond your sales team when hiring because you want someone with better phone experience. Once you locate people with a experience and these 3 characteristics, it’s essential that you keep them in the loop of the deals offered. Maybe even sit down with them on a monthly basis to watch the commercials all customers will see prompting them to call in. It’s best if your staff has limited knowledge of things like inventory and car features so that they can let the sales team handle that once the appointment is made.

Employ a BDC manager as well. A BDC manager will handle the call center and report to the GM rather than a GM taking the reigns of the dealership and BDC department as well. Your BDC manager will have the task of following up with the GM on a weekly basis to give updates; finding areas that can be improved.

Measurement/Main Goal
What’s the overall goal you’d like to achieve after implementing the BDC department? Which ever goal you decide to come up with, this will be the way in which you measure the success of your BDC. For example, if you’re overall goal is to increase sales, you will measure your BDC department by how many sales are closed.

Whatever the goal your dealership chooses to make, your GM will have to check in with your BDC manager regularly to ensure the efficiency of the BDC department.

How much to spend on Facebook Advertising

By now, I bet you are tired of reading about Facebook for your business. Every guide out there imaginable is available. The official guide to facebook; step by step guide to facebook advertising. While many of these have good and helpful information, unless you are really running these type of advertising campaigns, it is TMI!

You may be also thinking that you have used Facebook, and had no success. Well, Facebook is more than running your page, which alone takes time and effort. Having an effective page, and building followers and interest means posting daily. This means you need time and some creativity. Having a page is required if you are going to advertise. Advertising on Facebook just ads another level of required time and creativity. In addition you will need marketing and social media experience. Is it any wonder many are not finding success?

First of all, Facebook Advertising is not much different than any other type of advertising. One big exception, the platform is meant for any user to conduct their own advertising. The actual set-up anyway. Because you may know how to use the platform, does not necessarily mean you know how to advertise.

Now that is out of way, let me ask you, how much are you spending on Facebook Advertising? You should be dedicating at least 50% of your budget to this platform, if not more.

Why you ask? Well one simple basic reason: YOU CANNOT FIND A CHEAPER WAY TO ADVERTISE FOR THE NUMBER OF PEOPLE YOU ARE ABLE TO REACH. Most advertising if done right is effective, so why not use the platform that brings about the lowest cost per lead? It is much cheaper than TV advertising and Direct Mail.

Guess what Facebook Advertising also does for you? It builds followers for your page, which allows you to focus on posting content for your audience.

As mentioned earlier, unless you have some experience in advertising, coming up with good content takes experience and much trial and error and analysis. Overall, it makes more sense to hire an agency for your facebook advertising. This will in the long run save you time and money. Make sure you pick an agency that has been doing Facebook advertising for at least a year, has experience in leads ads, and can produce videos for your business. Why video? Well, video and live video results in higher engagement as compared to images, and links. Link posts actually result in 76% less engagement than video.

Now that you know video is the most effective tool for engagement, the percentage of marketers using video is only 4.6%

I found this percentage rather puzzling. Either advertising agencies are not being used, or they do not have video capability. Maybe they just lack in creativity. Please make sure this is a priority if your company wants to explore Facebook Advertising.

While we would love if you would consider Focus for Facebook Advertising, we just hope this convinces you to dedicate at least 50% or your budget to Facebook. Video Lead Ads are your best bang for the buck. Our clients are having success with these leads, and if you want to see some of our video samples, just visit our products and services page at Focusleads.com. We couple our leads with our proprietary phone tool, Focus Spark.

Why Pay for a 97% Website Bounce Rate?

Within the last few months, we decided to ad inventory advertising to our Facebook menu for our automotive customers. Many are already doing inventory advertising on Facebook using ads, and the market place. Many dealerships are also utilizing retargeting marketing in regard to Facebook advertising. This means if you click on a car on their site, you will be served that car in an ad on your page (sponsored ad). This is in the hopes you will follow up. Unfortunately, Facebook has discontinued retargeting for automotive. This however does not prevent retargeting outside of Facebook. This means you can continue to retarget your visitors on any other page besides Facebook.

When we decided to jump into this crowded inventory ad field, we just followed our Facebook advertising model that has worked well for us up to this point. Focus, being a direct response agency prefers Lead Ads. We did not really pay attention to the competitor as to the nuts and bolts of their ad set up. Why you might ask? Well, lead ads work plain and simple. Leads are the best for measurement of results. In addition our tool Focus Spark immediately contacts leads upon engagement. A click in our world really means nothing. Just not substantial enough. Leads convert or they don’t. Do clicks convert, well yes. But usually not right away, so you don’t really know if the ad is a direct correlation unless the clicks turns into a lead in the same time frame. To further complicate the source of a conversion from a click, if you are using a middle man such as Auto Trader or Cars.com, they could claim the click even if they end up on your site.

So what we ended up discovering was that it appears no one else may be advertising inventory WITHOUT directing the customer to the dealer website. We were quite surprised at this, since the bounce rate on websites is 97%! And this stat has been unchanged for years; these customers have no intention of speaking to you. So again our question to you is why is this acceptable? Why are you throwing away precious advertising dollars for these type of results?

Dealer websites do not do enough, but that is another issue altogether and has not changed. So, until this changes, why depend on it to generate leads? Stop paying to send customers to your website.

There are reasons why these customers vacate other than the website itself, and it has to do with the behavior of consumers in general. A good example of what I alluding to is an IKEA store. Have you ever been into an IKEA store? If you have, you may have a suspicion as to where I am going with this. And yes the meatballs do play a role, but not the one I want to make.

I believe it was Steve Jobs who pointed out that consumers do not know what they want. So directing them is the key. Do you now know how IKEA fits in? The arrows on the floor lead the customer around the store in a predetermined path designed by the store. The customer is not left to wander aimlessly. As a result, they are more likely to buy something. And of course, there is always the meatballs.

Cars are a bit different than furniture and household items, but our point is you still have to lead the consumer. You have to be the guide in helping them to make their decision. They may do quite a bit of online research before buying a car, so when they see an ad that interests them you have to grab them and guide them. Customers want a more personalized experience, and unless your website is set up to do this, you will lose the customer. As we previously mentioned, most automotive websites do not offer this. In fact, in a recent survey, only 26% found the dealer websites offered a personalized experienced. Not good.

Again we ask, why oh why do dealerships continue to use advertising dollars to send customers to their websites? Is it a lack of understanding of the ad process? Maybe that is why the opinion of these ads is that they do not work?

Lead conversion 101: You increase you chance of conversion by over 300% if the lead is contacted within ONE minute of the engagement.

Why You Need to Pay More Attention to this Demographic

Since I have been in advertising for many years, and being a Hispanic consumer, I thought it was time I addressed this long overlooked demographic as it relates to car buying.

What you are missing.

While most of us are aware of the growing Hispanic population, it seems to me that the status quo is more prevalent than ever when it comes to advertising. Every demographic is different in regard to their buying habits as consumers. Adjusting your business to different demographics can make or break you. And the Hispanic demographic, in my mind, is by far the most important, but also the most overlooked.

Different demographics have different tastes and buying habits. Some industries embrace this and do a good job incorporating these differences into their products and marketing. I find, however, that the automotive industry lags behind with the Hispanic consumer. And as a result, I believe car sales are being lost and you are missing deals.

Know the numbers.

The number of cars purchased by Hispanics is expected to double from 2010 to 2020. The Hispanic Demographic represents 50% of the U.S. population growth over the next several years with potential buying power of $1.7 trillion by 2020.

Over the last 30 years, the Hispanic population grew from about 14 million to over 80 million at the present time. The majority (over 50%) of this growth occurred during the 1980’s and 1990’s as a result of immigration. This growth continued until around 2006.

While the Hispanic population is still growing, immigration is no longer the main cause for the current growth. It has been replaced by Hispanic births. As a result this aging demographic is being replaced by a younger consumer. So the Hispanic Demographic is now split into two segments: An aging immigrant population, and a younger, bilingual, U.S. born population. These are really two demographics that require different marketing approaches.

Where is the Hispanic population living?

The heaviest concentration of the Hispanic population is still found in California, Florida, and Texas. This is due to the choice of settlement for the original immigrants (the older Hispanic population). This is also where the majority of the U.S. born Hispanics grew up.

However, the fastest growth is happening in cities not viewed as traditionally Hispanic. Charlotte North Carolina has seen the fastest growth, along with other cities such as Washington D.C, Atlanta, Raleigh, and Las Vegas. This is due to the increase in younger bilingual Hispanics, who can and want to live in more suburban and upscale areas.

Now that you are aware of the numbers, how many sales are you losing? You might be thinking we are selling to the Hispanic consumer, so how much of a difference could targeting this demographic really make anyway? Well, check out this story, it is about what happened to a dealership that decided to recognize the importance of this demographic.

Our next post will address how the Hispanic consumer is a better car buyer.

5 Ways to Increase Auto Leads during Tax Season

Check out the list below to make sure your dealership is running at it’s optimum potential for tax season.

Understanding Sales/Finance Reps
It’s widely known that tax season is the biggest time of sales for dealerships nationwide simply because people now have tax return money and they’re eager to cash it out on a new ride. This is great because the dealerships have a greater opportunity to push inventory off the lot, but this of course comes with one main stipulation: dealing with subprime credit. Having the right lenders is vital in getting these customers into a car. An example of a good lender that handles these type of customers is Consumer Portfolio Services, Inc.

Although buyers may have a large down payment, they may not necessarily have the money to withstand multiple months of payments on a new vehicle. This is where you utilize great sales skills to try and push a used or cheaper new vehicle. By doing this you may be losing a little up front due to the lower MSRP, however, in the long run you’ve increased your chances of the buyer NOT faulting on payments. Once your buyer is satisfied with the car that the salesperson has helped guide them to, have an understanding finance rep make sure that the buyer understands the credit situation in it’s entirety to get the buyer approved. With a solid plan in place, you’ll have a happy buyer eager to tell their friends where they purchased their new vehicle.

How Much Inventory is Needed
This is a rare problem, a good problem, but nevertheless, still a problem. A dealership may have an amazing selling period, so much so that they completely sellout of inventory. The obvious upside is that you’ve accomplished an unprecedented goal by having a deal so enticing the community literally bought you out. But on the opposite end of the spectrum, there was money to be made that was left on the table because your dealership was not prepared for the tax season demand.

There is no exact number to how much inventory should be on retainer at your dealership. Being that this is the time of the year where you sell the most cars and depending on how much advertising was put in place, you may want to have additional vehicles on the lot to match these efforts. You don’t want to be stuck in a place where you’re buying inventory off a competing dealership to meet customer demands.

Boost your Automotive Marketing Efforts
Out of sight, out of mind. This concept directly correlates to how your marketing efforts will affect sales. We’ve tested this with a dealership, and saw that with very minimal advertising, the dealership experienced an over 30% dip in sales. It’s imperative that your automotive marketing efforts are at full potential during tax season, so this doesn’t occur at your dealership. And today, your choices are vast, TV or digital ads, or both.

Because competition is fierce during this time, we’ve seen that dealerships who’ve capitalized on marketing performed significantly better. Your prospects don’t know exactly where to go, but if your dealership name is continuously buzzing in their head, you’ve just gained another sale.

 Deals, Deals, & Deals
To keep your dealership in the front of your prospect’s mind, you’ve got to offer a deal so enticing they’d be crazy not to at least stop in. Now we understand that manufacturers usually offer the main deals, but it may be in your best interest to add on to this deal to differentiate from dealerships that sale the same manufacture.

Manufacturers also offer incentives to dealerships to push inventory off the lot. Some incentives can have you paying no money in marketing and just generating strictly profit. This alone should be able to entice you and the rest of the marketing/finance staff to come up with a great offer. It’s also imperative that you follow up on the offer once a prospect comes in or direct them to a vehicle that would work with their budget and have them paying somewhere near the offer price.

Customer Service is the Icing on the Cake
From the initial walk through the door to driving off the lot, your customers will remember how they felt at every part of the transaction. This may seem obvious, but every little thing counts. Let’s break down just a few extra things you can do to make that customer feel that much more special at your dealership.

To make the experience enjoyable, your prospect should be greeted within 15 seconds of entering. Sit them down, show them the vehicles you have that meet their criteria in your database, and offer a beverage or snack for the walk immediately after. Another trend of the time is social media. Get them to post their new ride on their social media, and in return they get a free tag cover (which you already would’ve put on the car for exposure). Further down the line, have drinks, food, charging stations, and even free Wi-Fi in your waiting room for all fixed operations things like service on their vehicle. Offering these simple amenities will equate to more money and lead to more sales in the future.

If you wanted to be more innovative, you could create a financial system that’s more interactive than the usual finance manager sitting behind the computer and crunching numbers in secrecy. Showing the customers the numbers on a large and interactive touch screen gives them a sense of comfort and eases the mood when they’re the ones actually making the numbers change.

I hope this short list can help you look deeper into your current dealership processes to make a couple of changes if needed. This tax season, you should be able to sell more cars than you ever anticipated. Let’s make sure your dealership is doing everything in it’s power to achieve these goals. If you think you’ll need a little extra help this tax season or just want more car sales leads going forward, please visit Focusleads.com.  

Why Should You Care About CPL (Cost Per Lead)?

Are you overwhelmed with all the analytics that come with your advertising campaigns,and everyone telling you how important it is? Between television, digital, website, and email marketing and advertising, how do you find the time to look at all the data? Or even understand it? Not many of us have the luxury of personnel dedicated to this task.

A recent conversation that Focus had with a client, brought this issue to our attention. The conversation started about something totally unrelated, and then they suddenly started talking about advertising they had purchased from another agency they were working with. They were receiving a fair amount of leads, and so they wanted to double their spend to get twice as many. But that is not what happened. Their leads did not double. There was an increase, but not what was expected. They asked why do you think that is? Well, in so many words, we told them it was their CPL. It had changed with the increase in budget, and was obviously higher, thus less leads.

CPL or cost per lead is one number you should know well, it is easy to calculate, and it can be applied to any campaign you are running.
The fact is knowing your CPL well can help you evaluate effectiveness of your campaigns. In other words, are my advertising dollars being spent wisely?

Knowing the formula is the first thing:

ADVERTISING BUDGET(PER CAMPAIGN)/# OF LEADS OBTAINED FROM THAT CAMPAIGN
Once you know these numbers you can compare to the industry as a whole to see where you stand.

Cost Per lead is one number. You also need to know your conversion numbers – Percentage of appointments to leads, percentage of shows to appointments, and the percentage of sales to shows.

You then can use these numbers to determine your profitability, budget and feasibility. The trigger of Cost Per Lead will tell you everything you need to know to predict your future – CPL is your version of the Magic 8 Ball.

PROFITABILITY
Start with the end in mind. How much money do you need to gross? What is your average gross? Subtract the need from the average and you have your required cost per car sold – ADVERTISING BUDGET/# CARS SOLD = COST PER CAR SOLD.

BUDGET
What does my CPL have to be to deliver the required Cost Per Car Sold? That depends on your conversion of leads to sales.

The number of leads and cost of those leads is very important, but CPL means nothing if your leads are not converting to sales. Let’s look at an example.
Cost Per Car Sold Goal – $500
% of appointments to leads – 70%
% of shows to appointments – 40%
% of sales to shows – 25%

Advertising Budget $10,000
Cost Per Lead $50

Total Leads 200

In this example, the cost per car sold is $714.28

If you know how many leads you need to generate to sell X number of cars, you can set your advertising budget that will cause you to hit your sales goal.

And, don’t forget to give your agency your CPL goal along with your advertising budget. You can set a CPL threshold that will force your agency to evaluate and adjust campaigns to get the most leads possible. Lastly, do not forget to look at conversion.

FEASIBILITY 
If your advertising campaign CPL is too high, it is not working. You can then determine if you want to continue. But, as you can see, that is not the only factor you need to review. And, typically, the solution is a combination of factors but it all starts with knowing your numbers.

If you know how many leads you need to generate to sell X number of cars, you can set your advertising budget that will cause you to hit your sales goal.

Hopefully you found this useful as a tool for increasing your car sales. If you need more tips, do not hesitate to reach out!

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