Paying close attention to three key areas could prevent you from wasting 20 percent or more of your marketing budget. BY GLENN PASCH
You could be wasting 20 percent of your marketing budget. In fact, I think for some dealers this percentage might be higher. My opinions are based on what I see when I am brought in to provide clarity to the leaders of dealer groups. What would lead me to make this claim? There are a few reasons but I will boil it down to three areas so I can explain my reasoning and provide possible solutions.
If you are reading this article, you are already ahead of 70 percent of your competition. When the statistics show that reading levels are at an all time low, working to educate oneself shows a real trait of success. Which leads me to my first point:
Lack of consistent education
Too often automotive leaders are overwhelmed – they have multiple responsibilities to their business, their financial institutions, their employees, their families, etc. Being pulled in a million directions leaves little time to analyze all of the marketing spend and execution to ensure they are being the most efficient they can be. Add to this, a lack of time to educate oneself on the newest ways to improve efficiencies. This begins the trickle of wasted dollars. If you do not understand what your vendors are doing, how can you hold them accountable for maximizing results?
The biggest hurdle for many dealers is understanding the realm of digital marketing. It is still a bit unknown. The rules change as fast as ever so it is easier to ignore something or skim the surface than really owning the information to propel your business forward.
There are many ways to educate yourself beginning with reading articles on the topic. Attending conferences, webinars or classes are incredible ways to learn from some of the best educators, as well as from other dealers who can share their struggles and successes with practical applications. Whoever from your dealership attends these sessions should be required to bring this information back to the group, teach it to everyone and see how it could be implemented in their day-to-day business model. If you do not require this step, then you are adding to the trickle of wasted marketing budget.
This lack of education pairs well with the next aspect of wasted marketing dollars:
Vendor reporting and transparency
Many vendor reports are way too complicated and contain way too many touch points that mean nothing to the dealer in a practical sense. In some ways this is an outgrowth of point No. 1, because if the dealer does not understand certain metrics, then vendors rely on the volume of information to demonstrate their efforts.
Vendors should streamline their reporting to show actionable data to the dealer. Dealers themselves do not have to be experts but they should be demanding that their vendors explain in layman’s terms what they are getting for their marketing spend each month and how it is helping to achieve their marketing goals.
This applies to all vendors – traditional agencies, digital, process trainers and sales trainers, as well. If vendors cannot explain in simple terms what they are doing and show you the results, then they either need to fix this or be replaced because this lack of transparency is another contributor to wasted marketing dollars.
The third area of wasted marketing dollars comes from:
The lack of accountability to your customer processes
Dealers spend thousands of marketing dollars to drive traffic to the web, phone, email or showroom. I cannot fathom why more dealers are not aware of the ratios of engagement or execution of their processes. They know final sales and service numbers; they know what they spend. But they are not really diving into the step-by-step journey of their customer and understanding how the lack of inspection is adding to this wasted marketing effort.
Let’s say my first two points are maximized. By not paying attention to this third point, you allow staff to waste your money and then have the gumption to ask for more leads. Crazy when you think about it.
Track your efforts. Set higher standards for utilization of the CRM. Make sure your team is tracking everyone who contacts you. Make sure engagement levels, and appointment level are as important to you as front-end gross. Solid processes can make up for struggles with points one and two, so maximize this by hiring a trainer or just holding folks accountable to the process you have in place.
Finally, I am asked many times as I travel and teach: is there a way to increase sales without spending any more on services or vendors? Is there a way to be able to monitor everything, especially when it changes so much? Who can you trust? Which leads to my recommendation:
Hire a trusted advisor
What is lacking at the leadership table of many groups is someone dedicated to finding the efficiencies mentioned above. At times there are individuals who may manage one of the silos, but in my opinion there needs to be someone who manages this budget of money – many times not insignificant – and lead in the creation and execution of the marketing strategy. They need to make sure they have the right vendor mix and then hold everyone accountable. They need to make sure the internal processes are set up and then hold the people accountable.
My recommendation is that you may have to look outside of your current team for this person or hire a company to help you in the short term. This advisor benefits from not being in the day-to-day running of the company and they have the training to be laser focused on reports to know what needs to happen to improve performance.
If you have someone internally, then make sure that you are not loading up their day with tasks that pull them aside. This is a multi-million dollar business and maximizing efficiencies should be a top-of-mind priority. Get the help you need instead of letting this continue. Twenty percent is a large amount of money to be wasting each year.