Managing for Profitability

Ralph EbersoleDirector, Automotive Consulting and Dealer Training

Tracking and Measuring Media Value in the Online Age

Today’s Presenter

• Ralph Ebersole• Director, Automotive

Consulting and Dealer Training, Cars.com

• 30 years automotive industry experience

• Featured speaker at industry conferences

Tracking and Measuring Media Value in the Online Age

Today’s Objectives

• In today’s workshop, we’ll discuss:• Identify what to track and why• Develop a strategy for tracking your

investments• Assess and calculate ROI for various

marketing channels • Compare value across various online

advertising mediums• Determine next steps

Define Your Media Goals

• Identify clear goals for each marketing activity

• Define the metrics associated with each media channel• Branding• Traffic now

Measure ROI for Different Segments

Great Ads Build on Great Process

• Streamline merchandising with an established process for:• Uploading

inventory• Taking and posting

photos• Pricing vehicles• Writing sell copy

Process

Steps to a Sale-Walk-in

• Greeting• Needs Analysis/Manager intro• Brand Value Story• Select the right vehicle• Vehicle presentation• Demo Ride/Trial close• Trade Appraisal• Ask for the sales• Intro to F&I• Delivery /into to service

Steps to an Internet Sale

• Greet the Customer• Open inventory/Needs

Analyses • Obtain name and contact

information• Build Dealership Value• Sell the Appointment• Make Appointment• Confirm Appointment

• Frequency• Reach• Cost per thousand (CPM)• Effective CPM (ECPM)• Use earnings to compare

different types of online ads

• Earnings are the great equalizer

Branding

Traffic Now

• SEM• Cost per sale• Click to site - site to

store - close• Cost per click X site

conversion rate X close ratio

Traffic Now

• Pay per lead• Cost per sale

• Quantity and quality• Cost per lead X close

ratio

Traffic Now

• Virtual Inventory• Listing sites, dealer web

site, etc.• Cost/detailed page view• Five links to the store:

• Phone• Email• Website transfer• Walk-in• Chat or text

Set Media Expectations

• Before you can measure performance, you must define what you want to achieve

• Align objectives with expectations• Communicate program goals within the

store and with your marketing partners

Objective-Based Measurement

• Know what to measure• Traffic, sales, impressions• Quantity, quality

• Measure all of what you are getting and all of what you are spending• All forms of traffic• Ad costs, creative costs, management

costs

Measurement Benefits

• Evaluate marketing channels, vendors• Assess your ability to adjust processes• Optimize advertising budget, campaigns• Achieve greater staff accountability

“You can’t manage what you can’t measure.”

Assess Your Media Mix

• Evaluate online, offline media spend

• Consider the value each medium delivers

Measurement is Only as Good as the Tracking Behind It

Track Sales Metrics

• Vehicle sales• Appointments set /

kept• Gross profit • Cost per vehicle sold• Parts traffic / revenue• Service appointments

/ revenue

Track Campaign Costs

• Agency fees• Staff time and

resources• Media costs

Compare Costs

• Average cost per vehicle sold: $610*• Cost per sale from leads

• Sales from electronic leads• Cost per sale from SEM

• Cost per click X conversion rate X close ratio• Cost per sale from inventory display

• Sales from internet leads, phone, walk-in

* NADA Data, May 2008

Lead Source Composite Data

Inventory Composite Data

Tracking Tools

• Lead Management / CRM

• Phone monitoring, recording, tracking tools

• Post-sale surveys• Ad views, map prints• Website tracking• Third-party reports

Congratulations! You’ve just purchased a new vehicle! Please take this time to help us better reach our future customers by telling us about yourself: Date: _______________________ Did you purchase:

New

Used 1. Please tell us about yourself: Zip Code City 2. Which Website(s) did you visit/shop online for your vehicle before coming to us? (Check as many as

applicable) Cars.com KelleyBlueBook.com MSNAutos.com Manufacturer

Site AutoTrader.com Edmunds.com Dealer Website

Other Sites Visited:

3. Which radio station(s) do you listen to? 1. 6am-10am 10am-3pm 3pm-7pm 7pm-10pm 2. 6am-10am 10am-3pm 3pm-7pm 7pm-10pm 3. 6am-10am 10am-3pm 3pm-7pm 7pm-10pm 4. Which local new channel(s) do you watch? 1. AM Noon 4pm 5pm 6pm 9pm 2. AM Noon 4pm 5pm 6pm 9pm 3. AM Noon 4pm 5pm 6pm 9pm 5. Did you consult the automotive ads in the newspaper before shopping for your vehicle?

Yes

No

Which Newspapers? 6. Which cable network(s) do you watch?

Estimating Walk-in Traffic

• 1 in 3 shoppers on a used-vehicle site will visit your store versus calling or sending an email*

* J.D. Power and Associates, Dealer Satisfaction With Online Buying Services Study, August 2008

Track Results Daily

5 2 1 20% $2200 $2200 $750 $20 $120

Tracking Implementation

• Who will manage the tracking process?• Internal staff (e.g., GM, SM, BDC, ISM)• External agency

• How will metrics be tracked?• How will the information be shared?

• Audience, frequency, format

What to Calculate

• Sales opportunities created• Cost per vehicle sold

• Total and by source• Closing percentage

• Dealership total and by traffic source• Sales gross

• Dealership, source and individual sales rep

Steps to Improve ROI

• Align ad buys with opportunities• Branding• Traffic now

• Rank advertising opportunities for cost effectiveness

• Determine point where cost of additional traffic exceeds its value

Fine-Tune Your Process

• Use measurement data to identify areas in your process that need to be:• Refined• Replaced

Develop Staff

• Use measurement data to:• Evaluate salespeople• Motivate team

members• Improve sales results• Either change the

person—or change the person

Optimize Campaigns

• Improve marketing effectiveness by:• Increasing spend with partners and channels

that drive business results• Eliminating spend with vendors who

repeatedly fall short of expectations• Reallocating spend with partners and

channels that allow you to economize without compromising results

Review

• “You can’t manage what you can’t measure.”

• If it moves track it.• If you track it measure it.• If you measure it—hold your people

accountable • Either change the process or change the

person

Questions & Answers

Thank You & Good Luck