Durran Cage On Optimizing Dealership Advertising Efficiency

Kelly : So what’s your philosophy on dealership advertising? And what is your process in advising and working with dealers to optimize that spend? I know you’ve got something to contribute to that. That’s a huge aspect.

Speaker 2 : Good Question. So let’s break that down. First, the dealership advertising strategy, the first thing that we need to look at is what the organization is like, what’s so unique about your store? , Why? Why should people even do business with you? , I’ve asked myself the same question. Why should we do Cage Automotive? What’s up with you?

Then once you get clear on what that is, , you can call it a “why buy” a “value proposition”, whatever, then you start highlighting that and start promoting that, , and you focus on that brand that you have, because really, that the advertising strategy, your best form of advertising is your own employees.

Using them is your true advertising, how they get out to the community, , what they’re doing away from work, what they’re doing while they’re at work, what they’re doing on social media. Literally, you should just be paying your people to be part of your advertising strategy. Think about it, they’re out there, they’re promoting, they’re pushing, doing all these different things. And then you can connect that to, do we want to do TV? Do we want to do digital? but you have to have a strategy, because what I challenge dealers to do, or advertising out there is look at some of the best in the business, not just in our industry. Look outside. So if you look at Nike, Adidas, Gatorade, put Apple, what are they marketing? Then you need to align with that. And if you look around, most marketing that’s happening is around what? Convenience, speed, transparency. And so the advertising model needs to align with things like that.

Then when it comes down to your second part of the question, how do we analyze that spend, how do we justify how much money we’re spending? Well, you can use things like Google Analytics, of course, to get a good idea. And then you do have your CRM that you can use to look at it by source. But I mean, I’m an old school person. So when I ask for that stuff, I just say, hey, send me all the invoices – look at that, because that’s one thing that a lot of dealerships don’t do.

Right there is to like, when’s the last time you looked at all your spend and dialed it in to see where your money’s going. So we look at all that, and then you can marry that back to what we just talked about with the CRM to see which channels are the most profitable. And what I do before looking at the different sources that we advertise with, don’t pay so much attention to just how many cars you sold. But what I like to do is see how many of those people got engaged with this?

So if you had 100 opportunities come from one source, what was the engagement like there? And then if you had 100 opportunities come from another source? What was the engagement like I mean in a 2-way conversation? How receptive were those customers? And then how many appointments we’re setting and how many walk-ins and stuff like that?

So I hope that kind of answers the second part of your question in terms of how to look at spend. But I always look at the overall advertising spin last, and then focus on that culture, that energy, our branding strategy first. And then you can save a lot of money by using social media, in your CRM. I mean, think about it, dealerships spend a lot of time trying to figure out how they’re going to advertise their message on TV and these other channels. But what I challenge is make sure you’re using your own channel, which is your CRM, because you own that data. Right? That’s their data. That’s their baby.

So when you said that Audi store, I think you said that doesn’t really spend much, my guess is they’ve really dialed in on their own data to where they don’t need to spend so much on trying to bring in a bunch of people, they can invest their time and their dollars on their own sources in their own data that they have.

Kelly : Do you think that most dealers could probably remove half of their advertising budgets? And probably still do just as good?

Durran : Are you trying to get me hurt? Laughing!

Kelly : No, optimize advertising spend? Because I think you would go in and see where they’re wasting a lot of money, and where you could go in and highly benefit them.

Durran :
Yeah, but maybe I don’t want any vendors taking shots at me. So say if I had a new client that we’re going to start next week, before I look at how much you’re spending on advertising, and who, which vendors, I should just cut, again, I have to go back to their people, their systems, their processes, and then when we get to that part, and then we can see because what I normally find in I’m sure dealers if their listening to this, a lot of times where there’s overlap, that’s what I’ll find.

So you sometimes will see that there are three different companies that are getting paid for your Facebook advertising. You got your website company. So what I see normally, here we go, we’ll watch ourselves. But normally you’ll see that the website companies get into that advertising spend conversation, and then there’ll be another digital agency that’s getting some of the ad dollars as well. And then of course, you have your third party vendors.

And so you have to watch between those three, because there will be some overlap, you’re paying for the reviews, reputation management, where you’re paying for different companies to help you with your reputation. So that’s what I advise dealers versus like, let’s look and make sure there’s no overlap, and where we’re investing our money.

Kelly : That’s a good answer.

Reid :
That’s crazy Duran, good answer. I didn’t even think about it until you just said it. But I thought, yeah, we lose 70% of our business after 30,000 miles. Yeah, our retention is horrible,overall, and then I didn’t even think about they don’t even know how much money they’re spending.