Attribution? Some Dealers Still Don’t Even Track Leads and Sales!

There’s been a push for over a year among some automotive digital marketers to shift dealers’ focus away from traditional return-on-investment measurements (like leads, calls and sales) toward something called multi-touch attribution.

While this isn’t an article about the various attribution models being pitched by everyone from Google to your website provider, I do understand it would be helpful if I gave a very brief and basic overview of the multi-touch attribution argument most often being presented today.

Basically, multi-touch attribution provides insight into the (mostly) online journey for some of the buyers and shoppers in your market. Its intent is to convince you because some percentage of your buyers visited a given website during their journey, this website deserves some credit for the sale; even if the website never generated a call or a lead (or was even the last source visited by the buyer before they arrived on your lot).

Feel free to debate the merits of this avant-garde approach on your own time; I’m here to discuss basic tracking and measuring of those crusty old leads and sales.

Internet Sales 101

No offense… but let me state I truly cannot believe I’m writing about this in 2019.

However, I worked with several new clients over the past few months, and (as I always do) I asked in advance for some very simple tracking reports showing the previous month’s performance and their year-to-date results for both their lead-focused digital marketing vendors and those who manage their internet sales prospects (salespeople and BDC agents).

What I received from more than one store was startling. A few (unrelated) dealers provided me “reporting” that lacked actual valid measurement. Without basic reporting, there was no way for me or anyone else to make decisions on their digital marketing budgets or their personnel. Yet, these dealerships had certainly been making such decisions for years based on this worthless data.

There is a litmus test I use for digital marketing vendors that’s worked well for my clients who employ it. Simply put, if it’s not crystal clear from the reporting whether you should increase your budget, decrease your budget, or hold your budget steady for a given digital marketing provider, then you should cancel that vendor and use this money to buy billboards on bus benches. At least that way you can see your ads when you drive around town.

It’s Not Rocket Science; But, it is Math

Wait, if I’m tracking the wrong stuff, what should I be tracking?

For every digital marketing vendor you employ, you should (at the very least) track and measure the following:

• Opportunities Generated – This includes the valid, non-duplicated leads, calls, texts, chats and any other measureable prospect contact.
• Connection Rate – The percentage of opportunities you were able to connect with. (A very low relative connection rate, for example, might reveal a source sending you unqualified leads.)
• Sold Units – Duh.
• Total Gross – Knowing the front and back grosses produced by a given lead source allows you to better evaluate the sources that generate few leads but may close at a high rate and/or deliver maximum profits.
• Cost as a Percentage of Gross – Simply divide the cost of a digital marketing vendor by the total gross produced by this source. (My target for the average dealership is 16%; though arguments can be made that 20% is still okay. This is the average you should work towards when looking at all vendors; some will be higher and many will be lower, of course.)

Likewise, you should use these same basic measurements (save for the Cost as a Percentage of Gross), as well as Appointments Shown and Sold, when determining the effectiveness of your team’s performance.

Anything less than these measurements and you’re simply flying blind. You have no idea whether to spend more or less with a vendor; or whether or not to give a certain BDC agent more or fewer leads each month. Additionally, you have no idea which employees are properly working their opportunities, following your processes, or even making their phone calls.

It’s Not Even Close to Complicated

Once you begin properly tracking the performance of your digital marketing vendors and those tasked with responding to/selling these prospects, you should create some minimum standards and some goals so you can decide where you’re missing the most opportunities.

For most dealers, the following objectives are a good place to start:

• Connection Rate – Expect a minimum 65% for the average basket of leads, with a goal of 80%.
• Appointment Shows-to-Opportunities – For the average lead/call mix, you should expect a 25% rate, with top performers generating a legitimate 35%.
• Appointment Shows-to-Connections – This is where you discover if the reported connections are real or faked. Expect a 35% rate for an average lead mix, with your best people achieving close to 50%.
• Appointment Show Rate – Top performers get 70-80% of their appointments to show on time; while those new to appointment setting can deliver around 50-60%. (Note: I’m wrote “on time.” Appointments that arrive more than an hour early or late are not valid appointments, and should not be counted as valid shows.)
• Appointment Close Rate – The average for an untrained dealership team is around 40%; while top dealers close about 80% of their legitimate appointment shows.

Sounds Simple, Right?

Actually, it is quite simple – and a great way to manage your business with much less effort than you’re expending today.

For those dealers who believe they’ve got these metrics covered and they’re hitting at or near the top; I say, excellent, you’re ready to launch headfirst into multi-touch attribution.

For the rest of you, I recommend you dive into the data you have (or can easily generate), pull out the metrics that matter, track and measure these over time, and start holding vendors and your team accountable to helping you grow via digital marketing.

Or, you could always just move this budget to your bus bench billboards’ campaign. Again, at least that way you can see your marketing dollars at work.

Good selling!