Post on 20-Aug-2015
Why buying 3rd party is still the most efficient advertisement
Plus: How to engage the consumer in their preferred method of
communication to increase engagement
• How we gathered our results
• ROI of internet leads
• What is influencing buying behavior
• Best Practices (Phone, Email, Text, Chat)
• Mobile Opportunities
Topics
Copyright (c) 2014 Autobytel Inc.
Overview Who is “Polk” Over 5 million Autobytel internet leads sent to Polk annually Polk matches leads to State Registration data for all 50 states “Committed” = Purchased the brand in the internet request
Close rate by source Close rate by makeCrossover between makes
(submitted lead for Toyota and bought Nissan)
Crossover between New and Used
(submitted lead for New and bought Used)
Time between lead submission and purchase
Lost sales report by dealer
Copyright (c) 2014 Autobytel Inc.
Industry Influences
Brand Parity
Merging of Tier One and Tier Two brands•Domestic Bankruptcies•Recalls•Tsunami
Less loyal generations of
consumers
Product Parity
Increased Marketing spend
Industry quality awards
More time spent researching on
web sites & inventory
Improved on-line content
Purchase behaviors continue to change
Consumer use of ratings & reviews
Copyright (c) 2014 Autobytel Inc.
• New Vehicle buyers spend 11.5 hours online (Source: R.L.Polk/AutoTrader.com
Automotive Buyer Influence Study)
• 37% of shoppers enter the market without a specific brand in mind (Source: Compete Vehicle Cross Shopping Analysis, July 2012)
• 59% of consumers don’t decide which vehicle to buy until the last week (Source: JDP 2012 New Auto shopper Study)
• New-vehicle shoppers consider average of 3.3 vehicles – up from 2012 (source: JDP 2013 Avoider Study)
• Baby Boomers only visit 1.9 dealers and overall based on dealership experience all generations express a desire to avoid salespeople in the future
( source: AutoTrader Next Generation Car Buyer Study)
Industry Studies
Copyright (c) 2014 Autobytel Inc.
• Autobytel base line close rate is 16 - 25%
• If a dealer is closing less than the base line they are losing sales and revenue
Why This Data is critical to dealers
Copyright (c) 2014 Autobytel Inc.
Buying Funnel
Not Really – Just Different
Research
Consideration
Lead
Evaluate Evaluate Evaluate Vehicle 1 Vehicle 2 Vehicle 3
Purchase
Copyright (c) 2014 Autobytel Inc.
What’s changed?
• Myth – When a consumer submits an internet lead, my competition is my fellow brand dealer in the area . . .
• Truth – The consumer is still shopping brands as the consideration set is being finalized
• Consumers submit leads as a starting point to begin the discovery and analysis of their consideration set.
Copyright (c) 2014 Autobytel Inc.
Lost Sales Dealer Reports
Leads Purchased from Detailed DealersPurchases based on 1 month of leads and up to 3 months registration period
Sales Match Period: Lead Date + 90
Autobytel Dealer NameNumber of
LeadsTotal
Purchased Purch. Assigned Dealer Purch. Other Dealer Purch. Other Dealer
Anytown Chevy 33 14 7 7 CHEVROLET | CRUZE | 2013 Main Street GMC CHEVROLET | EQUINOX | 2013CHEVROLET | EQUINOX | 2011 Main Street Honda CHEVROLET | EQUINOX | 2011
CHEVROLET | SONIC | 2013 Premium Toyota TOYOTA | PRIUS V | 2013CHEVROLET | CAMARO | 2013 Hometown Ford CHEVROLET | TRAVERSE | 2011CHEVROLET | EQUINOX | 2013 GMC of Anytown CHEVROLET | EQUINOX | 2006
GMC | ACADIA | 2013 Import Kia KIA | SPORTAGE | 2013CHEVROLET | SILVERADO | 2013 Great GMC CHEVROLET | IMPALA | 2013
Dealer had 21% Close Rate but lost 7 additional sales
Copyright (c) 2014 Autobytel Inc.
Why Third Party Leads
• Return on Investment– Anytown Chevrolet - $25 per lead X 33 leads = $825 expense
• 7 confirmed sales (probably more) x $1,000 front end and $1,000 back end• $14,000 - $825 = $13,175 gross profit• Cost per sale = $118 – ROI 16 :1
– What if Anytown got 3 of those 7 lost sales• 10 sales X $2,000 = $20,000• $20,000 - $825 = $19,175 gross profit• Cost per sale = $82.50 – ROI 23:1
– What if Anytown only got 3 sales• $6,000 - $825 = $5,175 gross profit• Cost per sale = $275 – ROI 6:1
– ONLY 1 sale• $2,000 - $825 = $1,175 – still ROI positive
Copyright (c) 2014 Autobytel Inc.
Brand Defection - Demographics
• Bought a different Make• (New or Used)• 53.61%
Submitted a New Car
Purchase Request
Based on Household income
Less than $15,000 = 60.45%
Over $150,000 = 49.85%
Based on Age Head of Household
18 to 24 = 68.12%
55 to 64 = 51.28%
Demographics show variance in buying behaviors
Based on Gender
Male = 51.44% Female = 54.19%Copyright (c) 2014 Autobytel Inc.
Brand Defection - Demographics
• Bought a different Make• (New or Used)• 53.61%
Submitted a New Car
Purchase Request
Based on Household income
Less than $15,000 = 60.45%
Over $150,000 = 49.85%
Based on Age Head of Household
18 to 24 = 68.12%
55 to 64 = 51.28%
Demographics show variance in buying behaviors
Based on Gender
Male = 51.44% Female = 54.19%Copyright (c) 2014 Autobytel Inc.
Correlation “Committed*” / Loyalty
Autobytel “Committed” Brands – Bought New
– SUBARU– TOYOTA– HONDA– CHEVROLET– NISSAN– JEEP– DODGE– FORD– CADILLAC– HYUNDAI
“Committed” = bought the brand that the lead was submitted for. Copyright (c) 2014 Autobytel Inc.
Correlation “Committed*” / Loyalty
Autobytel “Committed” Brands – Bought New
– SUBARU– TOYOTA– HONDA– CHEVROLET– NISSAN– JEEP– DODGE– FORD– CADILLAC– HYUNDAI
Polk Loyalty Ranking Q1 2013– FORD– TOYOTA– HONDA– CHEVROLET– NISSAN– MERCEDES-BENZ– BMW– SUBARU– LEXUS– HYUNDAI
“Committed” = bought the brand that the lead was submitted for. Copyright (c) 2014 Autobytel Inc.
Brand Defection Buying Patterns
Buying Pattern after New Car Lead Submission
2012 Polk sales results
Copyright (c) 2014 Autobytel Inc.
Brand Defection Buying Patterns
Buying Pattern after New Car Lead Submission
Copyright (c) 2014 Autobytel Inc.
New to Used Defection
• Bought Used – any make• 40.23%
Submitted a New Car Purchase Request
Based on Household income
Less than $15,000 = 55.81%
Over $150,000 = 28.52%
Copyright (c) 2013 Autobytel Inc.
Based on Age of Head of Household
18 to 24 = 67.59%
55 to 64 = 33.74%
Demographics show variance in buying behaviors
Copyright (c) 2014 Autobytel Inc.
New to Used Defection
• Bought Used – any make• 40.23%
Submitted a New Car Purchase Request
Based on Household income
Less than $15,000 = 55.81%
Over $150,000 = 28.52%
Copyright (c) 2013 Autobytel Inc.
Based on Age of Head of Household
18 to 24 = 67.59%
55 to 64 = 33.74%
Demographics show variance in buying behaviors
Copyright (c) 2014 Autobytel Inc.
New to Used Buying Pattern
Buying Pattern after New Car Lead Submission
Copyright (c) 2014 Autobytel Inc.
New to Used Buying Pattern
Buying Pattern after New Car Lead Submission
Copyright (c) 2014 Autobytel Inc.
Off-line Experience
Copyright (c) 2014 Autobytel Inc.
Less visits = more burden on the internet lead process to drive visits
Baby Boomers visit 1.9 dealerships
Gen X visit 2.5 dealerships
Gen Y visit 3.1 dealerships
Based on their dealership experience, in the future they will avoid salespeople:
56% Gen Y49% Gen X37% Baby Boomers
(AutoTrader.com Next Generation Car Buyer Study Sept 2013)
Off-line Advantages
Dealership Brand is featured
• Ability to test drive and explore vehicle features and benefits
• Ability for a professional walk around of the vehicle
Sales Consultant can be a vehicle consultant:
• Who will be driving the car?
• How will the car be used?
• What features are important in a vehicle?
Ability to profile the consumer to lead them down a personalized vehicle presentation
• New/Used/CPO – Model – Trim – Colors – Optional Equipment
Copyright (c) 2014 Autobytel Inc.
On-line Experience
What demographics and buying behavior trends do we know about this consumer?
How committed are they to my brand?
Do we stop at price or do we start asking questions?
Copyright (c) 2014 Autobytel Inc.
On-line Challenge
How can we give them the off-line dealership visit experience?
How do we create a need for them to visit my dealership?
This applies to responding to leads plus website strategies to drive showroom traffic
Copyright (c) 2014 Autobytel Inc.
On-line lead responses (phone and form)
Internet Sales Consultant can be pigeon holed into being an information provider:
1) Do you have the car I want?2) What is the price?
When a consumer submits a lead WE MAKE THEM PICK A YEAR/MAKE/MODEL.
Is that the vehicle that really meets their needs?
Copyright (c) 2014 Autobytel Inc.
Traditional Best Practice
Why buy from me
1
Vehicle of interest
2
Alternative vehicles 1 New 1 Used
3
Quick Response Time and Continuous Follow up
Copyright (c) 2014 Autobytel Inc.
Internet Process Needs to Change
Why Buy Brand
1
Why buy from me
2
Vehicle of
interest
3
Alternative vehicle(s)
4
All used
options
5
One size fits all does not work – emphasis needs to vary for each dealCopyright (c) 2014 Autobytel Inc.
Recap/Communicate Differently
• Email responses and talk tracks need to:– Reinforce the brand – why BLANK is a great brand with a great
lineup– Mention the various trim levels and other similar models– Briefly explain CPO and your used inventory (all models)
• But the real opportunity lies in communicating differently– Texteo and Audio interaction– Video and Audio interaction PLUS co-browsing
April 18, 2023
Copyright (c) 2014 Autobytel Inc.
Challenges• The key challenge is contacting the consumer
– Challenges with Phone • How many times do we call, and at different times?• Do we call to sell the car or the appointment?
– Challenges with E-mail• Do we use Automated responses and how often? Do they look like
Auto Responses?• Do we give pricing on-line?
– Create a 2 way dialog instantaneously• Do you give the consumer the option to Text your dealership?• Do you offer Chat?• Do you offer multiple communication options (video and audio)?• Can you make your website a virtual showroom?
Copyright (c) 2013 Autobytel Inc.
Copyright (c) 2014 Autobytel Inc.
Who is Texting
• It is not just the Millennials that are texting• Note the income levels – prime income demographics
Copyright (c) 2014 Autobytel Inc.
Call Volume vs. Text Volume
Click to call is very popular on smartphones but note how text volume out paces call volume in all age groups
Copyright (c) 2014 Autobytel Inc.
Text Leads • Consumer adoption of Texting is growing
– 98% of text messages are read, compared to 22% of emails, 29% of tweets and 12% of Facebook posts. (Frost & Sullivan 2010, Slick Text)
• Limitation on characters leads to more of a conversation than trying to cover every detail in one e-mail or phone script
• Ability to be consultative– Two way conversation
• Ability to respond to consumers on the lot – Your lot and others
• 49% of automotive smartphone users made a purchase related to that interaction (The xAd/Telmetrics Mobile Path to Purchase Study)
Copyright (c) 2014 Autobytel Inc.
Concerns Government compliance (TCPA)
Several recent text message cases have resulted in multi-million dollar settlements. For instance: • Lithia Motors - $2.5 million class-action settlement (between
$175 and $500/phone number)• Twentieth Century Fox - $16 million class-action settlement
($200/ phone number)• Simon & Schuster - $10 million class-action settlement
($175/ phone number)• Timberland Company - $7 million class-action settlement
($150/ phone number)
Copyright (c) 2012 Autobytel Inc.35
Text Gateway• All communication is logged
into a Text Gateway to assist with legal compliance
• Hierarchy rules in place to hide the phone number from unauthorized users
• Gateway stores Opt-in consents and Opt-out STOP
• Text Gateway data can be downloaded to dealership CRM system for sales tracking
Copyright (c) 2014 Autobytel Inc.
Interactive Engagement Platform
• A true “virtual up” to create a high-touch interaction with consumers
• Video, voice, chat and dual-cursor guided browsing with any visitor
• Explain incentives and offers to visitors in real-time
• Traffic is viewed real time on the website
With in-person visits to dealerships declining, consumers are now walking around “virtual showrooms” (automotive websites) to make their purchase
Conclusion• The traditional buying funnel has changed
– More vehicles are being considered and the funnel is fluid– Majority of consumers do not buy what they think they are going to buy
• Form leads are not dead but there are more options available today to communicate beyond phone and e-mail
• It is not hard to have a positive ROI with Third Party Leads• Text Communications is growing
– Actionable & Customer initiated
• Recent technology allows for bringing the showroom experience into desktop and mobile devices
– Audio and Video Chat & Co-browsing
• Bottom line – allow consumers to communicate with you in their preferred communication method– Higher Engagement with More Efficient Communication– Capture the high % that leave without filling out a lead form
Copyright (c) 2014 Autobytel Inc.