Auto Dealership Market Share - Commonly overlooked and costly
Automotive Online Marketing - Controlling & Reducing Web site, PPC or CPC Expenditures ...
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The internet and a dealership Web site are likely the only advertising medium available today which levels the playing field between the Mega-Dealers with seemingly endless resources and the Average Size Automotive Dealer. The major search engines such as Google™, Yahoo™, and MSN™ don’t know or care about how much advertising money a dealership intends on spending, only that a dealership is willing to invest money for an internet presence. The single largest factor effected by the amount of money a dealership is willing to invest is the listing position of online Price-per-Click or Cost-per-Click advertisements and this may not always be true since the major search engines now consider ad relevancy in their placement selection.
It should also be mentioned that when considering an in-house automotive dealer Price-per-Click or Cost-per-Click marketing campaign, the number one position isn’t all that it’s made up to be. Actually studies indicate that it may be beneficial to be further down the PPC or CPC listing, since a click-thru would indicate that the prospective sales lead is actually spending time researching for a relevant ad and not just clicking away, in turn producing a higher closing ratio.
The fundamental objective of initializing a simple in-house dealership cost-per-click marketing campaign is not solely for the purpose of overshadowing online competition, but to Compliment the Advertising – Branding – Marketing Cycle. All dealership should remember if merely using traditional advertising mediums such as; Newspaper, Television, or Radio these marketing mediums will breed internet activity. This essentially means that the Internet has now become a necessary ingredient when building consumer awareness and marketing - branding an automotive dealership, even if the sole purpose of the dealership Web site is to generate floor traffic.
You must make sure your dealership name, location, phone number, hours and e-mail addresses are accessible online or any automotive marketing campaign will purely drive prospect sales to another online advertised dealerships.
The bottom-line ... No auto dealership internet presence fractures the marketing sales cycle, preventing a prospective automotive buyer from completing the purchasing cycle with your dealership.
Now, the reason you’re most likely reading this Web page is you’re researching online automotive internet marketing and contemplating the cost of marketing an automotive dealership online by utilizing a Price-per-Click or Cost-per-Click advertising campaign. Again, the bottom-line ... The true cost is immeasurable, there is no magical formula which will calculate lost dealership revenue by not having a dealership internet presence. But there are benchmarks that your dealership has established which can be utilized when creating an acceptable Website, internet marketing budget or maintaining an internet PPC or CPC presence. These benchmarks are your existing marketing cost per sold unit, with the long-term goal of reducing, total dealerships advertising cost per sold unit. This would be a rational starting point. |
AutomotiveProfit.com,
Putting forward its best effort in helping the Automotive Dealership develop and create a Viable – Cost-Effective Online Marketing Campaigns.
Feedback & Comments Wanted
DealerService@AutomotiveProfit.com
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Before completing some calculations as to what a Price-per-Click or Cost-per-Click Campaign might cost a dealership and the potential Gross Profit opportunity, I’d like to address one last item; Online Market Share & Dealership Market Saturation.
Why are these words,
Online Market Share & Market Saturation never mentioned by Web site Service Providers and Internet Marketing Firms?
Quick Note: I’ve read thousands of articles about marketing a dealership online, but try to find an article covering these two subjects. If you know of one please e-mail DealerService@AutomotiveProfit.com. Always curious as to how other address the issue of Online Market Share & Market Saturation of a dealership Web site.
 At what point will online marketing efforts and additional advertising expenditures become ineffective and costly?
Starting first with Market Share ...
Nobody really talks about it except the automobile manufacturer which is gaining ground, but it’s an extremely important number which is commonly overlooked by an individual auto dealer in the planning stages of dealership marketing and budgeting. First let’s face the facts, even though a dealership believes it can increase market share it’s the manufacturer that is really the powerhouse. Increasing a dealerships product line market share substantially can pretty much only be accomplished by the manufacturer producing a desirable product for the consumer, branding its product line appropriately with the current market, providing dealer support that gives them the financial capabilities of expanding their individual market share, and by providing the automotive consumer with an incentive to crossover make and market lines.
Why is this mentioned on an internet marketing Web page? The fact is no matter how much money and time you invest in a Web site or Online Marketing Campaigns there will always be an upper limit in its cost effectiveness and its percentage of return on investment unless the automobile manufacturer is conquering its competitors.
Let's Reflect and begin our calculations based on these 2 Key Variables; Total Local – Regional Sales & Dealerships Percentage of that Market Share.
Starting with Local – Regional Sales .. Within a viable selling radius of your dealership of approximately 90 miles how many new units of your product line are sold, five hundred, thousand, two thousand, five thousand? It doesn’t really matter you just need the number; the reason this number is important, is because it provides you with an approximation as to the maximum unit sales that can achieved with an Dealership Web site, anything above that may simply offset lost sales due to product defectors.
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Let’s start some simple calculations;
Let's assume your Local – Regional Sales number equals two thousand units, with this number in-hand, “Would it not be fair to say that the only truly cost-effective leads to attach to your dealership Web site are these two thousand Local – Regional automotive buyers?”, in turn meaning the maximum number of truly interested online unique automotive buying individuals are these two thousand Web surfers.
No, Wait, Step back one second ... according to current studies only 80 % of vehicle purchasers research online. That now makes the active online shoppers total 1600 Web surfers. Wait again; I personally believe the words " Customer Retention " are an important factor to consider when calculating your online automotive sales market potential. I don’t believe any Dealership Web site can disband this element totally, a loyal customer earned by a respectful hardworking dealership is going nowhere but back to the deserving dealership. On the low end let’s consider the Customer Retention percentage to be 25% of Local – Regional Sales which equates to another 500 unapproachable – unsellable sales.
Mathematical Conclusion: 1100 Viable – Sellable Product Online Buyers
(2000 units sold multiplied by 80% of all buyers online minus 500 unsellable Web surfers)
Now let’s review your Dealerships Percentage of that Market Share. Knowing your dealerships total monthly sales number calculate your dealerships market share (Dealership Sales Number divided by Local-Regional Sales = Dealership Market Share, not rocket science) and for calculation purposes it is assumed you’re dealership is currently at 10% of the Local Market Share (Selling 200 units monthly). The next consideration would be estimating a realist number as to how many additional unit sales your dealership could generate with an effective dealership online marketing campaign. Let’s assume you’re a dreamer and hope that an effective online campaign will help your dealership achieve a 20% market share or an increase of 200 additional unit sales.
Mathematical Conclusion: You must now actually sell to 18.2 % of all online Web surfers, considering your automotive product line within a 90 mile radius.
(200 Additional Unit Sales divided by 1100 Viable – Sellable Product Online Buyers)
To achieve a Sales - Closing Percentage Level of Web surfers that high makes one think of terms such as; Dealership Marketing Genius, Automotive Advertising Wizard, and Automotive Marketing Mastermind; lets be realistic, its not really conceivable with an Online Marketing Campaign only.
So now that we’ve played around with these silly numbers, take this to another level;
First, marketers toting numbers like 10,000 Web views per month, the market indicates there are only 1600 truly interested viable – sellable individuals online. My first question would be; “I hope my dealership isn’t paying for the remaining 8400 non-sellable Web site views”
Secondly, if 80% of all purchasers really researched an automotive purchase online, wouldn’t that be more prevalent on the sales floor when qualifying lead source?
Thirdly, these numbers that are being freely played around with are simplistic, and require a few more calculations to determine if improving your Automotive Dealerships Web site and Online Marketing Campaign would be profitable and are solely designed to be thought provoking.
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Want to know your Online Sales Potential? Try utilizing this Free Excel® spreadsheet which will enlighten you;
Understanding your Dealerships Online Sales Potential
The Bottom-Line .....
Know your target market, localize online Price-per-Click & Cost-per-Click Automotive Marketing Campaigns, and most importantly know your Market Share upper limits, preventing wasted Online Automotive Marketing Efforts and Expenditures.
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Need Help Getting Started?
No Outrageous promises, No Contracts, No Management Fees
Simply a little help with Campaign Set-up and Keywords, than turned back over to you.
Approximate Set-up Cost, $ 200.00
DealerService@AutomotiveProfit.com
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