Your advertisements play on all of the popular radio stations during rush hour. Your billboards tower above the most heavily populated streets. Screens showcase your television ads during prime time. You even know your CPC, CPM, and reach of your social media advertisements.
You might think your marketing efforts are supporting your ultimate goal of bringing customers on to your lot, but are they?
What you likely do not know is the conversion rate of these advertisements, and we’re not talking about conversions to your website.
Knowing your website visitation numbers is a valuable metric, but there is a more important factor to evaluate. How many of those people who viewed or listened to your advertisement physically came to your lot and purchased a car?
Until Facebook introduced offline conversions, it was very difficult to tell, but since the implementation of offline conversion reporting, you can now determine the exact dollar amount spent to convert online viewers into on-your-lot clients.
Utilizing meticulously input data from your CRM, Facebook matches the names of those who purchased a vehicle from you with the names of those who viewed your social media advertisements within the last 28 days.
A 25 dealership offline conversion study performed by my digital marketing agency, Mazama Media, output some surprising data. Ads with higher engagement frequently did not actually translate into in-store, offline purchases. Conversely, many people who viewed ads did not interact with them but did come to lot to purchase a vehicle.
So what does this tell? That even if an advertisement may be showing high engagement rates, it may not be the ad that is attracting the most customers. Without offline conversion, you may be canceling the advertisements that bring in the most revenue and wasting money on advertisements that receive high engagement but are bringing in little, if any, cash.
This is not to say that engagement is an invaluable brand strategy because it absolutely is important, but if your main goal is to sell, engagement is not your best metric. You want conversion rates, not just likes.
With automotive, there are a lot of comparisons and shopping around, so the more you can get in front of potential customers, the better odds you have of selling them your brand.
In fact, according to the Global Auto Consumer Journey Study (), in the United States, 63% of car buyers discover new automobiles online and 53% of those people make decisions on new automobile purchases while online. You want to be sure you really are offline converting these online viewers.
So how do you do it?
UTILIZE A/B TESTING
By employing A/B testing to analyze which advertisement features best-converted viewers into consumers, my company deliberately altered the ads seen by potential Faulkner Automotive customers to increase conversion effectiveness. As of April 2019, this method resulted in an 88% decrease in cost per attribution in just over six months: from spending $486.23 to convert one viewer into a customer to spending a mere $56.21 per customer. While working with these 25 dealerships at Faulkner Automotive, our marketing methods contributed to over 3,600 vehicle sales within a seven-month period.
IMPLEMENT AIA
Facebook’s Automotive Inventory Ads (AIA) show online viewers the exact vehicle they viewed on your website– down to the VIN. By utilizing your vehicle catalog with details such as the make, model, and year, social media advertisements automatically generate to show potential customers what they have personally identified as your most compelling inventory. In our study, AIAs generated a CTR of 3.39% and clicks at just $0.72. Comparing this to traditional cases that resulted in $0.99 per click and a 0.84% CTR, this means that the cost per click decreased by $0.27 and an over 300% CTR increase was seen when utilizing AIAs.
EMPLOY A SOCIAL MEDIA CHAMPION
A social media champion is an employee of your company who creates genuine and specific content to your dealership as opposed to publishing stock or corporate images on your social media channels. Why is this important? According to a Bonfire Marketing study, “91 percent of consumers want the brands they follow to be authentic in their posts.” Authenticity builds trust, and trust breeds customers. Spend approximately $100 on a gimbal to stabilize video for the feel of higher-quality in-house content.
TARGET USING FIRST PARTY DATA
Use your CRM to create target audiences to advertise to the customer whose lease is expiring or to entice customers to come in for vehicle servicing. For one of our clients, promoting their service department for eight months attributed to a total of 396 service appointments, resulting in an average of $1.57 per attributed service from the ad dollars allocated to those audiences.
Apply Facebook offline conversion reporting and the tips above to get company-specific, real numbers that lead to higher conversions and, ultimately, revenue optimization.