Why You Need to Handle Your Marketing In-House
Here is my take on some points to consider when dealing with the constant barrage of dealership marketing programs
Everywhere you look there are people offering to market your motorcycle dealership. From the company that provides your website services, to the powersports manufacturers, to dedicated marketing agencies. There is no shortage of people ready to put you ahead of the competition. This may sound strange coming from someone who has done lots of consulting work in the past, but the truth is for a motorcycle dealership the best solution for marketing is to handle it in-house. There are several reasons I say this, and I would like to offer my insight.
Nobody cares about your business like you do
Lets just think about this statement for a second. As a dealership owner you want to increase sales, increase efficiency (reduce overhead) and beat the competition. Not just beat the competition but crush them and take their market share. Business, and particularly motorcycle and automotive sales, is not a game for wimps. Aggressive tactics are an essential part of growth. If you have any doubts, go read “The Everything Store” about Amazon and Jeff Bezos or “Shoe Dog” which is Nike’s story. Successful growth depends on beating out your competition.
Your manufacturer line will never employ a marketing campaign that will take business away from their other dealers. Your marketing agency will never put together an optimization campaign that will hurt their other dealer clients. Your website provider will never use technology that would put you over the top of their other dealership clients. More importantly – and this is the part you must understand – if any of them learn of something you are doing that is generating strong, positive results it will be given to their other clients which are your competitors.
Website Provider Marketing & Optimization
As a powersports or automotive dealer we all have the same requirement and that is to get our inventory, plus all the pictures, video, 360 views and information from our DMS to the website. It must be reliably automated and require the minimum amount of human maintenance. Unless you have lots of resources like RumbleOn or CarMax most likely you won’t build your own system. You will use a website vendor that specializes in dealerships.
Your website provider has how many dealerships signed up for their services? Go look at your competitor’s website and see who is hosting their dealership. Are you both using the same vendor? Do you really think the vendor is going to put your interests over everyone else? No. Their plan is to provide an even level of exposure and leads for everyone. Even if they did find something that worked well for your dealership, they certainly wouldn’t keep it exclusive to you, it would be spread to everyone overnight along with an email explaining how lucky everyone is to have this new feature.
Manufacturer Marketing and COOP
Its especially important to understand this concept when you are evaluating the relationship you have with the manufacturer and their COOP programs. To an even greater degree your interests and the manufacturer are divergent. Yes, they want you to make more sales and move more inventory, but they don’t want you to swallow the other fish in the pond because it is not beneficial to them. Which is better for a manufacturer – to have one dealer in a large DMA who is number one in the U.S. – or 4 average dealers doing the same volume as the one? They make more money, have a bigger footprint, and more diversity in case of an individual dealer’s financial difficulty.
Second, and just as important is the fact that our market is digitally driven. Our customers are shopping online. The CRM system and customer data has always been a key component to successful sales but with today’s tools and the ability to mine that data our customer information is extremely valuable. The manufacture wants it, they want to know where it came from and how you got it. They want to use it themselves, but just as importantly they want to understand and copy your successful marketing strategies for their other dealers and their own marketing goals. Believe me, they are not interested in helping you become the top selling dealership, they are interested in making ALL their dealers top sellers.
Is this bad? Not at all, but you need to understand the dynamics of your manufacturer relationship, leverage it where you can, protect yourself when necessary, and use everything you can to beat your competition.
Don’t believe me? Think about the last time your sales rep convinced you to over-buy on your last PGA order. Is he really 100% on your side?
I will try to write a more in-depth article on how to leverage manufacturer marketing programs, but for now the basic summary is that I look to use them to build brand awareness and dealership awareness. I don’t use them to market specific stock. I use them to acquire specific leads through their programs, but I never let them see the leads I acquire through my programs. So, no website tracking, no sharing of analytics etc.
Manufacturer Turnkey Programs
There are several ways that manufacturers use COOP funds to incentivize/lure you into you into programs that are not designed to work 100% in your favor. My rule of thumb is that the effectiveness of turnkey is pretty much related to the split they offer. Normal COOP split is 50/50. So, you pay half, they pay half. Turnkey programs usually come in at 75/25 or 80/20, meaning they pay the lion’s share and you have a reduced commitment. Why is that? Usually its to promote awareness of their products (not your dealership) or to obtain data.
One of the first types of programs you will see are social media feeds. They will use a company to place images and content on your Facebook pages, your Instagram or even automatically change the banners on your own website. Its convenient and just look at how much juicier the split is for funding. But if you take the time to go look at your competitors that are using this service you consistently see the same thing. The imagery is super slick, but the message doesn’t include your dealership, or link to your website, or display your phone number. The tagging is not optimized for your dealer, its optimized for the manufacturer. If you do a lot of inventory and other posts, you can also have problems with their vendor posting within minutes of something you’ve put up and burying your own content. That said its not totally useless and it can have its place. You just need to understand its not going to increase your sales.
Another program type is a SEO/SEM campaign. The manufacturer would very much like to get direct access to your data and configure your website for the best search engine results – for their product. The problem is that unless you are a very small dealership you probably are trying to sell multiple product lines. You have goals that should shift and change in response to your competitor’s strategy and the market. We watch our competitors search engine strategy at a minimum bi-monthly.
For example let’s just say you are one of three dealers in the Chicago area for a specific line of motorcycles. Your goal is to be the number one dealer in Chicago and that means the entire DMA. When someone types in search terms like “Honda motorcycle” you want to be at the top of the list. In a perfect world you should be the ONLY dealer on the first page. That might not be possible, but it certainly should be your goal. Is that Honda’s goal? No, absolutely not. They want the user to see all the dealerships.
Recently there has been a push to have dealers use the manufacturer’s CRM instead of the system your dealership uses. The claim is better “efficiency”, but the real reason is to trap leads and data. It is the goal to have every dealership’s lead information squarely in the hands of the manufacturer. They can analyze where and how those leads came in and more importantly they can use that information themselves.
Lets go back to the scenario where your dealership is one of three in Chicago and you have two strong competitors. If you are on the south side, and you get leads from the north side do you really believe the next mass mailing that the manufacturer initiates are going to direct those northern leads to your store? Better yet let’s consider leads far beyond what most consider their normal market. For example, we can generate 30-40% of our sales from outside a 150-mile radius, and many sales at 500 miles or more. We do it because we are good at marketing our stores and we need it to survive the winter. Will the manufacturer promote their latest products, their latest offers to your customers and leads in Texas when your store is in Chicago? No. They will promote it yes, but they will be directed to their local dealers and you lose. Believe me, that loss is huge. You never want your customers thinking about any other dealer but you.
Remember that right now we are in a flush economy and sales are much easier than they will be in the next downturn. You want every bit of data you can get to help you survive and grow when times are tough, and you want your competitors to miss those opportunities.
Maintaining Data Security
Recently a company came to me and offered to place a dealerships entire inventory on a brand-new listing website. All they wanted was access to our Facebook Pixel. What could go wrong? Primarily they get your website audience, and they can market anything and anyone they want to that group. You are not their only client – so what stops them from marketing your competitor’s products to your audience? Nothing – they can do what they want. You will never know and its instantly great traffic for all their clients, so their services look great and they make money off all your hard work. Again, their interests do not align with yours. More importantly if you don’t have someone on your payroll who understands the technology aspect you are vulnerable to giving away assets you really want to keep private.
Reporting and Getting Honest Analytics
It is imperative that you have internal reporting capabilities so you can get real, honest numbers that tell the tale of how your money is being spent. I have run enough reports to know that anyone can skew numbers, and marketing agencies have lots of ways to make themselves look good. Learn to set your own benchmarks and ROI goals and look at the statistics yourself. I can’t tell you how many times I have caught vendors over-promising and under-delivering, but without any way to track results myself I would just be giving them more money
Tracking your website traffic is important, but it’s not the only key metric. You need to be able to track within your CRM system where your leads come from, how they respond and how many convert to actual sales. For example, we see hundreds of leads from manufacturer events, but the conversion rate is abysmally small. Anybody will give information for a chance to win a car, but does that really convert into a sale? When does it convert into a sale – this month or in two years? These are important questions and knowing how to generate reports from your CRM, website, social media and inventory listing sites is critical to understanding how your money is being spent.
No agency, vendor or manufacturer can create and maintain those types of reports for you. Their interests and your interests do not 100% align. I cannot emphasize enough that gathering information and regularly analyzing and distributing reports throughout your organization is very important to overall success. Lead Source, Conversion Rate, Inbound Phone Calls, Call duration, Outbound Calls by Sales Rep and so much more. These are critical metrics that translate into real money.
Having this base of solid reporting allows you to engage with marketing vendors and feel confident that when you do contract a spend whether it is digital or traditional media that you can predict the results. You can also verify the reports that these agencies will provide. Even better, when you see a report that you like take the design and bring it in-house.
You must approach your marketing options with the understanding of where the pitfalls are and how to use everything to your own advantage. It is a highly competitive market and success depends on understanding the tools that are available while looking out for your own best interests. In my opinion this is best done with an in-house marketing department.