Automotive ROI Marketing- A guide for Dummies (or the rest of us)

What exactly is ‘ROI Marketing’? Simply put, ‘ROI Marketing’ means measurable results for the dollars spent to promote a product, brand, or individual. In today’s ‘New Age’ of the Automotive Retail industry every penny, every second, and every customer count more than ever. The ability to laser-pinpoint the target market, speak to it, and measure the results are critical to the success of your dealership.

Return On Investment (ROI)

The old saying "50% of my advertising is working—I just don't know which 50%" does not apply to ROI Marketing. If it does not pay, do not use it!

‘Yes sir, we send blast-emails out every week’

What is your ROI on the ‘blast email’ tactic? In the past we used to measure if the weekend newspaper ad worked based on the whether or not the vehicles advertised sold. Then we advanced to counting the amount of people who walked through the door as a measure of that same ad. As we advanced we added the phone-call count as well. Did we ever measure the total Gross Profit, minus the cost of the ad, and divide the sum into the cost? I am sure the newspaper never did for us; the pain would have been too great.

How do we measure the ROI on the weekly email blast? At first glance we can look in to our CRM and see how many of the emails were ‘opened’ and how many were ‘opened unique’. To have 25% opened unique is a good number for the ‘blast’, but did it sell cars?

ROI Marketing Approach- No More Blast! Email less recipients, push higher unique openings, and higher closing ratio by utilizing your own database to create unique offerings.  The metric is 50%-70% unique openings with 20% closing ratio.

‘Social Media, sure we have Twitter, Dealerrater, Yelp, and Facebook pages’

The facts are Social Media is not a fad, in fact for millions of Americans it is an everyday part of life (some studies show up to 12 hrs. a day). The theory behind Social Media is as old as time, word of mouth and opinion. The execution of Social Media is what is new; instant, relevant, and unfiltered are musts.

Social Media will be your best friend or your worst nightmare depending on how well you manage it, think of it as your ‘on-line reputation’, any poor reports from a ‘friend’ can be a killer.  You can ‘Twitter and Post’ all of the $29.99 oil change specials you want, but if you are not reputed to take care of the customer, your $29.99 oil change will never work.

Generation Y has 75 million buyers in the Auto sector, and they rely MORE on Social Media to tell them WHAT and WHERE to buy, not just HOW MUCH. You may have the lowest price but if you have a poor on-line reputation you will never see them.

Would you eat a restaurant with 3 out of 5 stars, if the 5 out of 5 star restaurants were as close and only 8% more money?

ROI Marketing Approach- Two prong approach and one source for managing all of your Social Media communication.

  1. Internally the Dealership must have strong processes in dealing with customer complaints, here are some suggestions:

-          Return EVERY phone call and email from a customer within 24 hours of receiving.

-          A ‘We Owe’ signed by the Salesperson, Customer, and Manager outlining what is ‘included’ in the transaction            (extra key, floor mats, rebates, etc.) BEFORE going through finance.

-          A ‘$0’ chargeback to Salespeople policy for fixes after the sale (this does not include promises made by                    Salesperson).

-          When a customer does complain it is handled by the appropriate Department Manager in one phone call, this            call can handled by inviting the guest back in to the Dealership for inspection 95% of the time.

-          When the customer arrives, they are greeted by the Department Manager then turned to appropriate staff to                rectify the situation.

  1. Ask for the review, DO NOT ASK for a PERFECT review:

-          During the sales process inquire where the customer did their research on-line before coming to the                            dealership.

-          At the end of the delivery, ask the customer for a review of their experience. Steer then towards Google, Yelp              and Dealerrater

-          During the after-sale follow-up processes ask if they have post their review.

-          Once posted, thank them!

-          Begging for ‘perfect’ reviews only infuriates the guest and degrades the whole Social Media process for them

Invest in one source to manage all of your Social Media communications. Whether this is outsourced or done internally this job is CRITICAL to leveraging your online reputation. Remember, you cannot call it ‘Marketing’ if your reputation is poor. The online community can smell manipulation a mile away, but they also reward transparency.

Take a moment to review your advertising budget, what kind of ROI do you have? Are your leveraging the most cost efficient forms of communication, email and Social Media? Keep in mind it has always been about ‘word of mouth’, now it is about speed!

If I can help or answer questions, send me an email at

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Comment by Michael Baker on March 8, 2011 at 12:36pm
Good reinforcement Kip on the SM editorial. Do not agree the standard/criteria returning a phone call and/or email within 24 hours. Customer is more likely to continue search post an hour. Multiple ways/means to respond within an hour.
Comment by Dan Beldowicz on February 28, 2011 at 2:22pm
Great article, glad to finally see people starting to get that just posting specials or just inventory to Facebook and Twitter is NOT social media marketing, it is NOT a strategy, and it will NOT get you any more customers. Dealers need to start PARTICIPATING on these sites in order to see an ROI. They will need to engage fans, provide value they need to market their presence in Social Media not just expect that people are on Facebook looking for them, they need to integrate social into their overall marketing strategy and see that people, their customers drive their business. By studying their customers they would see how to use social media to increase sales and satisfaction.

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