The Automotive Paid Search Dilemma

Audi Coupe
Audi Coupe

Automotive paid search involves a hefty amount of expectation management.

General managers want leads and search analysts struggle to bridge the communication between a less tech savvy audience and the data.

In the automotive industry there are a few factors that have held back some of the innovation for paid search across the industry.

A few of these pain points stem from a few key areas within the industry.

  1. The influence of an OEM (Tier 1) who sets specific influences and guidelines within the market for Tier 2 (Dealer associations) and Tier 3 dealers (Your local dealerships)
  2. The lack of understanding of digital metrics within SEM platforms
  3. The difficultly in measuring full funnel attribution from click to sale

What I’ve found to be most interesting across this channel of communication is that the parties involved are all aware of the pain points inherent in marketing dealers efficiently.

There lies an opportunity for those who want to bridge the antiquated buyers journey and optimize the automotive digital journey of the future.

Many have seen the astronomical rise of companies like Carvana and CarMax. However, both companies are focused on used cars where regulation incentives and manufacturer pressures are no where to be found.

This makes for an interesting conversation when you discuss “goals” that are set at the Tier 3 level by OEMs. General managers express their opportunity in used cars however, their new car goals combat the ability to invest solely against capturing used car leads.

Another key pain point is within the systems and legacy processes that have cascaded throughout the industry.

Many have heard and know that automotive is “fragmented”. This is most prevalent in the systems in place to nurture leads from website to sale.

If you were to compare a highly technology driven startup to a dealership you would find the stark contrast in measuring the buyers journey.

  1. The lack of consistency in the brand delivery. For example, submitting a lead and getting multiple follow up emails or none at all.
  2. The lack of measuring attribution (Most specifically from paid channels due to DMS and CRM integration pitfalls)
  3. The lack of understanding of CPA (Mainly due to the divide between traditional and digital media spend

What is the dilemma we face in the automotive space?

A main issue is the lack of unification across legacy process and tech. The average dealership relies heavily on third parties to bridge the buyer’s journey online to sale.

This causes a lack of both investment to create a unified buyers journey and measurement of attribution for the marketing dollars spent.

For large dealer groups the opportunity is evermore ripe for the taking.

The advantage is the level of scale that dealer groups have against the average mom and pop dealership.

Do dealer groups push away third party support in an effort to unify the tech stack, hire within, and drive better customer experience?

Interested in chatting more about this?