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Why All Your SEM Spending Isn’t Generating Sales

Brian Pasch recently dropped a comprehensive report exposing that stunningly few sales opportunities are being generated from the massive amounts of money car dealers are investing in SEM.

The biggest revelation was that, after analyzing 1 million phone calls which originated from call extensions on sales-focused Google Search Ads, only 12.8% of those hard conversions turned out to be actual sales opportunities — with the vast majority going to dealerships’ service or parts departments.

Considering that the report estimates that nearly 93% of all Google Ads budgets are paid for by variable operations (sales), and not fixed operations (service & parts), you can see how uncovering this data would have an unnerving impact on car dealers. 

OUR REACTION TO THE NEWS

At Dealer Inspire we take a lot of pride in our ability to maximize ROI for dealers on search — we started out as a search marketing agency! — and we’re proud to report that we still got it. Our team and tech are effectively turning our dealers’ investments in sales campaigns into sales opportunities, just like the doctor ordered.


In fact, our results were totally flipped from the report. 88% of the engagement on our new and used sales campaigns are leading to new and used sales actions.

This isn’t about bragging rights though. Brian’s report was, as usual, a really insightful and important look at how dealer budgets are being wasted by poor digital marketing execution — and whether you’re with us or not, we want to help.

So let’s break down why this is happening, and how you can fix it.

WHAT AGENCIES ARE DOING WRONG

There’s a lot to unpack here. We’re going to stay high-level and talk about the broad keyword targeting that burns through budgets, but there are many variables throughout the journey that add up — from ongoing campaign optimization, to the relevancy and quality of the ads themselves, to the landing page experience, to your website’s engagement tracking, to your “conversion” reporting, and then back to the beginning as those “conversions” feed back into your optimization.

Bottomline: you need a partner that:

  • Handles your campaigns with love and care
  • Has the technology and data to target ready-to-buy shoppers
  • Can ensure seamless experiences and attribution from your ads to your website
  • Can transparently report on the real-world outcomes of your investment.

Let’s get into the specifics.

GOING BROAD IS BURNING BUDGETS

So what does a wasteful search ad look like? It probably looks like the one below.


On the surface, it seems pretty legit, right? That’s because it is. It’s not the ad itself that’s the problem here. When you dive deeper into the campaign, you’ll see that this dealer is bidding on the very broad term Hyundai Dealer Near Me. Now, don’t get me wrong, that’s a keyword you’d want coverage for if you can meet the following conditions:

  1. You’re already maximizing your paid search budget for low-funnel, ready-to-buy keywords
  2. Your Fixed Operations department is helping cover the budget for that campaign. 

Because you don’t know the intent behind a broad search like that, you need to understand that the searcher could be looking to buy a car, but they’re just as likely to have a service related question.

With over half of the calls from the ads in these broad “dealer near me” campaigns going to service, running a 100% sales focused ad, powered only by the budget of your sales department, reduces your ROI by taking away valuable sales opportunities from your sales team.

You obviously want to be present in the SERP for broad queries like Honda Dealer {City} or Honda Dealer Near Me, but unless you can afford to pay for all those searches forever, the top of the funnel is where you want to rely on strong SEO and Local SEO services to earn those clicks for free.

With a holistic SEO Strategy in play, you can achieve top rankings in Google’s Local Map Pack and Organic Rankings, giving you the highest level of visibility possible for applicable queries without running ads. The more you invest in your organic presence, the more efficient you can be over the long-term.

WE HAVE THE ANTIDOTE TO WASTED AD SPEND

So you’re probably wondering, when it comes to paid search advertising, what is Dealer Inspire doing different from everyone else? Well, it really comes down to the fact that our tech and team are able to dynamically focus on really low-funnel searches that indicate a shopper is ready to buy, and then match them with vin-specific vehicles in your inventory, in real time.

We’re so dialed in with the intent behind what a searcher is trying to accomplish with their query, that there’s very little room to mistakenly have a conversion result in anything other than a sales opportunity or engagement. 

“Sales campaigns should be optimized for your cost per sales opportunity (CSO). So wait at the bottom of the funnel for shoppers that are just about to buy a vehicle that you have in stock, and then pounce. Our tech makes that snap decision in real-time. ” –

Cara Garvey, Digital Advertising Director @ Dealer Inspire

On top of that, we also have a secret weapon that allows us to get even more precise with our targeting. Because we’re part of the Cars.com family, we have the advantage of being able to inject Cars.com’s in-market audience data directly into our SEM campaigns.

We can use Cars.com’s high-quality in-market audience data to power your SEM campaigns, ensuring your dollars are going to real high-intent sales opportunities.


We know that when people are on Cars.com, they’re searching to buy a vehicle, not to service one. Combine that with the knowledge that half of the shoppers on Cars.com plan to buy within the next 30 days, and you have yourself a high-quality audience that compliments your new and used vehicle campaigns that’ll yield a higher click through rate, and lower cost per lead, than any other in-market or search audience. 

In the report itself, Brian covers in-depth how a third party marketplace like Cars.com is going to consist of an audience that is ready, and more likely to buy, than those who are using Google search — so why not make that connection?

FIND THE SALES OPPORTUNITIES BEYOND SEARCH

A car shopper’s buying journey can begin anywhere, at any time, on any device. While some have already zeroed in on their favorite model and use search to find a dealer to buy it from, many others start their high funnel search for the right vehicle on Cars.com and discover your dealership in the process. 

Not only does Cars.com receive over 26 million monthly visitors, but 92% of those shoppers are undecided on what vehicle to buy, and where to buy it from. That means having a presence on a marketplace that is 100% focused on driving sales opportunities can be more impactful than just trying to capture people’s attention in Google search results. 

But beyond the shopping engagement that takes place within the Cars.com ecosystem, there is also that first party data I mentioned above. Not only can you inject Cars.com data into your Google Ads campaigns with us, but you can also use it to transform the ROI of your advertising by targeting that same audience across platforms and devices with omnichannel video advertising and social inventory ads

START WINNING SALES OPPORTUNITIES

Dealer Inspire is your trusted partner for implementing a search strategy that maximizes your ROI. If you’d like to learn more about how we can help you improve your search campaigns, reduce wasted spend, and connect with more local, in-market shoppers — please drop us a line. We’d love to connect with you!


Brittany Meyer
Brittany Meyer oversees Digital Advertising for Major Accounts at Dealer Inspire. In her tenure with DI, she has crafted unique digital strategies for dealer groups across much of North America. Fueled by her conversations with dealers, she has a secret obsession with inventory analytics and the power of data integrations. Like really obsessed - don’t get her started unless you have a few hours!

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