Google recently made a policy change that limits the ability to target customers by zip code. This could have a major impact on dealers and OEMs as they market and advertise. Today, we discuss this change with Peter Leto, CEO of Foundation Direct and former Head of Automotive Retail at Google.
As of October 19, 2020, Google will no longer allow advertisers to target customers via zip code targeting. Except if they follow very specific restrictions. In other words, ads cannot be placed to target a specific zip code without following these two rules. The ads can no longer show financing, credit, or pricing information. Similarly, the landing page that an ad takes the customer to can no longer show that information as well.
According to Peter, Google put these restrictions in place to protect consumers and to protect marketers from unlawful behavior. There has already been a lot of backlash from automotive marketers. They argue that dealers and OEMs rely heavily on targeting their local zip codes. As a former Google executive, Peter asserts that Google is well aware of the implications this policy will have on dealers and marketers.
“This is part of a larger diversity, equity, and inclusion effort that Google has in the marketplace,” explains Peter. “As you can imagine, outside of automotive, and sometimes within automotive, marketers will target customers based on race, socio-economic status, etc.”
With these changes, Google is taking a stand and saying that they will no longer allow this behavior. With civil unrest and racial inequality in our country, Peter believes that Google and other major corporations like Facebook are making committed efforts to affect change.
What does this mean for dealers? As a result, Peter says that dealerships will have to decide if they can move away from zip code targeting. Google recommends trying radius targeting. If dealers pivot to radius targeting, then the ads can include financing, credit, or pricing information. If dealers are unwilling or unable to make this transition (due to OEM policy), then their ads will become generic and less detailed. Essentially rendering them ineffective.
Did you enjoy this interview with Foundation Direct’s Peter Leto? Please share your thoughts, comments, or questions regarding this topic with host Jim Fitzpatrick at jfitzpatrick@cbtnews.com.
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