By Eric Brown, CEO/Co-Founder, inSearchX
Before we begin this conversation, I have a confession to make. In 2009, I co-founded a company, Dataium, which aggregated clicks from across thousands of automotive websites to determine consumer purchase intent and vehicle consideration. Dataium was purchased by IHS/Markit in 2015, and yes a lot has changed since then, but it’s still with a certain level of remorse I write this article.
But for today, regrets aside, I have to express this thought: Are clicks killing digital marketing? Due to the scope of this conversation, I have created a three-part series to dive into this question.
What is the impact of all these clicks on digital marketing effectiveness, what is the true cost of all these clicks, and how do new solutions create opportunities to resolve this dilemma.
Part 1. Asking consumers to navigate a gauntlet of clicks to discover inventory and engage your local sales team has failed to perform.
Why do we buy clicks?
Nobody buys clicks solely to increase traffic on their website. We buy clicks, we buy traffic, with the hope these clicks will lead to a conversation about …a car. Devoid of a conversation, it is very difficult to start, let alone close a deal with any consumer.
If we all agree this to be true, then our next questions have to be:
- How do we generate more conversations about cars?
- How do we compel more consumers to engage our sales teams when shopping for a car?
- How can we now remove existing friction in the ‘purchase funnel’ and streamline the customer and our experience?
Currently, multiple points of friction encumber the path to purchase. Much research on this topic is available, including this important study published in Q3 2020 by the Boston Consulting Group titled, ‘Zero Friction Future’. Their data clearly demonstrates several key points of friction as consumers search for a vehicle to purchase.
Here are are a handful of their red flag’ friction points::
- Shopping Research: No tools available to consolidate information for decision making
- Personal Data: Requirement to share personal data to obtain more information
- Communication:Lack of online/mobile messaging options
- Support: Lack of personalized support to help consumer choose vehicle
- Inventory and Pricing: Vehicles, pricing and finance options hard to find + inaccurate
To help us go forward, let’s first take a close look at the current ‘click path to purchase’ and what we’re losing along the way.
Click one, the ad click. Millions of consumers are presented with digital ads online each day. Advanced ad targeting data and technology are used to find the right consumer and place the right ad in front of them. And yet, despite this increasing sophistication, the average click through rate nationally for all automotive digital advertising, remains .4%. This means with the very first click in this process we have lost 99.6% of our sales prospects. We are not off to a good start.
With click two, we hope the consumer freshly lands on our website homepage, navigates our search parameters and conducts an inventory search. How many consumers actually conduct an inventory search on a dealership website? Though there is no reliable national data for this, a quick review of Google Analytics for a representative sample of websites shows an average of 54% of consumers conduct an inventory search when visiting a dealership website. With this click we have lost half of our .4% who clicked on our ad.
Now, on to click number three, the selection of a car from the search result page. This typically involves the consumer scrolling on a page of search results. What percentage of consumers who visit a dealer website make it to a vehicle details page? Answer from our representative sample: 34%. So now we have lost 2/3rds of our .4% who clicked on our ad.
Finally, what percentage of consumers who visit a dealership website submit a contact form of some type, the widely accepted number here is less than 2%. But let’s call it 2% to be generous.
How did 100,000 impressions become only 8 opportunities?
At the end of this gauntlet of friction and clicks, we have effectively reduced the available pool of sales opportunities by 99.992%. Out of 100,000 auto shoppers targeted with an ad, only eight remain and become a sales lead.
Beyond the numbers and math we see each click along the digital sales funnel dramatically reducing the number of sales opportunities.
There is still one more metric we must consider. Of these eight shoppers, how many will the sales team actually connect, and how many will discuss a car? From the beginning our goal was to speak with consumers about the purchase of a car, not to optimize the traffic count in our Google Analytics report. With what percentage of leads do we actually dialog? In interviews of dozens of dealership General Managers, the numbers are consistently less than half.
Less than 50% of the .008%.
The Dealer’s Gauntlet begins.
The arrival of the lead information creates the friction-filled gauntlet at the dealership level.
The ‘Gauntlet of Follow Up’. This endless sequence of text and email messaging, phone calls, and so on is not only exhausting, it’s expensive. How expensive? Stay tuned for part 2, More Clicks mean More Costly Conversations.
Click Fatigue is Real.
Clicks are everywhere. They are neither a means to an end, and as we have seen, are not conversations. Reducing the friction along the consumers path to a conversation is critical in today’s marketplace as consumers desire for control of the sales process grows. Other verticals are removing clicks from their process. Look no further than Amazon and their ‘one-click purchase’.
In fact, the click through rate nationally has declined 44% year over year.as consumer expectations for fluid friction-free processes and resistance to clicks and forms continue to rise.
But do not despair, the same technology that brought us the internet and all these clicks can now connect the world, seamlessly. New solutions like AskOtto’s Open Dialog Advertising platform are now available to remove this dreaded ‘Click Gauntlet’ from our future. More on these types of solutions in part 3.
Are Clicks Killing Your Digital Marketing? (Part two of three)
In part one of this three part series we focused on the Gauntlet of Clicks we ask consumers to navigate on their path to purchase and its impact on the volume of sales opportunities available to us. You can access part one here: www…….
With part two we are focused on the impact this gauntlet of clicks has on advertising and operating costs, and the related cost of generating a conversation about a car. Why is this important? As we discussed in part one, the objective for any advertising and marketing plan is to generate a conversation about car. Not more clicks, not more traffic. After all the very reason we buy this traffic is to generate more sales opportunities and sales opportunities are defined as conversations about buying or selling a car.
So first determine how to calculate the cost of a conversation. There are a variety of costs that go into this calculation. Let’s start first with the initial advertising and our cost per click.
First off, a confession. I co-founded a company called Dataium which aggregated clicks from across automotive websites to determine consumer purchase intent and vehicle consideration.
The company was founded in 2009 and was purchased in 2015 by IHS/Markit. So it’s with some remorse that I write this article. But I have to ask, are clicks killing digital marketing?
The focus of part one in this three part series focuses on the impact of asking consumers to navigate a gauntlet of clicks to discover inventory and engage your local sales team. Part two will focus on the expense of our clicks, and part three will offer a “game-changing” solution.
About the Author
Eric Brown, CEO of inSearchX an Open Dialog Advertising platform company. ,He is an industry expert, been a guest on Fox News and quoted in the Wall Street Journal, Forbes and USA Today andothers, and was named Nashville, Tenn.’s “Innovator of the Year” for 2012.