First of all, I love this site. Great content, great interaction and informative. As the Marketing Manager (and de facto Internet Manager) of a Honda dealer in Ohio, conversion ratio has now become a VERY important topic. Honda has started tracking dealer response times and conversion ratio of all prospects that come through their site or from approved 3rd party vendors. As Jay mentioned, universal measurement is needed, but don't forget the human factor. A critical element in the equation is making sure that all prospects are properly accounted for in the sales process. At our dealership, we are relying on 3 sales people to to handle internet leads and document the results. (Over 2500 last year alone from Honda) We have no stand alone Internet Dept, our DMS is Cobol based and ancient, we have Higher Gear but don't use it because it won't communicate with our DMS. This means that any analysis regarding sales conversion effectiveness is doomed because the data is incomplete or completely wrong. We're in the process of setting up a BDC, and looking at a new DMS. (Anyone have an opinion regarding Arkona?) By the way, according to Honda, our current conversion ratio is 9.7, slightly below the standard. In case you're wondering, we finished 2007 with just over 3000 new units sold, and just over 100 were credited to internet leads. One other thing to keep in mind. When we use metrics like conversion ratio, we focusing solely on whether we sold a car immediately to that lead. What about the value of having another customer in your database for future marketing efforts? They (or their family) will be buying again in the future. What about pitching them service, body shop, etc. All of these efforts would be FREE when using your CRM.

Joe,

Interesting. I like the Velcro analogy. I agree, that's why I hard coded my blog entries on my homepage with good 'ole HTML. I'm not pulling them from a database. Totally static content. That might seem backwards, but I'm testing something out.

HTML is an old Internet tech, but the perfect spider food for search engine algorithms. And I believe I can get bonus points with the search engines if my 'index' file (homepage file) changes size (bytes) very frequently. That's why I'm hard-coding in the content. It'll become more dynamic later.

I think the hybrid site (flash w/ text blog) will be a good model for awhile. At least that's what I'm going with this season.

I've resorted to putting a chili recipe up on our blog to go along with our Winter Chill Weekend Special. I must be getting desperate....

Thnx for the compliments Wayne, to me a blog is Search Engine Velcro. Blogs are ideally configured to be SE friendly (in my world THIS is the reason blogs are so prevalent)

So... It's a beta, less than 10 units up there so there isn't enough "size" to have a community magic, and to me honest, the comments are a small part of the game plan.

thnx~
Joe

Joe,

I was just checking out your usedcarqueen.com - I love it. Very nice. I was curious about what kinds of comments you have been getting? Are the customers being cool?

Wayne

Wayne,
As you know, Compete.com's not dead on accurate, I use it for a relative measurement.

Everybody has a unique situation. I am in rural upstate NY with 1,500 used units on the ground. Nearly every make & model is here. So we're the big fish in the small pond. Your market and inventory profile is 180degrees apart from mine, so comparisons are a total waste.

I need help with internal measurements, I can help with SEO.

FYI: A few months ago, I launched this blog as a SEO test bed: http://usedcarqueen.com/ It's not your common blog where someone puffs community service stuff. It's truely a SEO long tail farm. Only a handfull of autos on it, very time intensive, but it's worked beter than my expectations. Too busy with other tasks to take it to the next level.

Toss me an email, I need some help with internal tracking and measurements.

joe

Shaun,

Thank you too.

I think SEM is crucial. It's just not the 'end-all-be-all.' It's been around awhile. I just get irritated when a consultant calls me pushing it like its the hottest thing. I don't think it is. Besides, shouldn't they already have known that I am doing SEM before they call me? Why can't these guys go out and do a couple searches on Google to know if I'm already out there?

I'm focusing more on organic listings now. That's why I put a blog underneath my flash site. I wanted to add some 'meaty' text for the search engines to munch on. I'm not allowing people to comment yet though. I'm afraid of what I might get. If a deal goes bad, I don't want the customer running to my blog to slam us. And if I were to delete the comment, that might create even more problems. So for now, I'm just putting up a simple blog.

I'm starting to think the Blog is just as important as SEM. Someday, you'll have to have one or you'll seem mysterious in the eyes of the customer. I'm just guessing though.

Regards,

Wayne

Joe,

I appreciate your comments. And I agree that the game is changing very quickly...about every 4-6 months.

We may be at 25K+ dealerships in the US now, but that number will drop. The digital divide between dealers is growing too rapidly. Most owners feel they have an Internet strategy and don't want to break what they think is not broke. Their selling cars, but feeling the grind too.

What they don't realize is that their website starts depreciating, like cars, the minute they put it up.

Tech grows old fast. Websites grow old even faster.

I talk alot about the website because I believe it is the heart of the whole system. It's Grand Central Station. (theres a landmark you should know) I want my customers to come back to the website multiple times to complete various tasks. It makes them think they're "buying a car over the Internet." They're not really, I'm just putting them through some hoops to give them that impression.

If a BDC rep can't get the appointment, we give them homework, something to do. I want them to get off the phone and go back to our website to do something instead of going to another dealer.

I track every single click a customer makes. I know what they looked at, when, how often, etc. I even know how many errors they make on forms. That gives me an idea of how upfront this customer is. Did they try to give me 'lkshjdflksdj' for their firstname or a bogus number? Or did they fill out the form straight-up with no errors? All these miniscule details come together to form a profile of the customer and gives my BDC reps an angle of attack.

I score each of my leads coming from the site. I call it the EngageScore. The more a person clicks and the deeper they click, the more points they score. If they start drilling down onto specific vehicles...opening pictures, moving cars to favorites, they'll score even more points. I can then rank order them based on their activity. A higher scoring customer gets more attention from the BDC. If a visitor just hits the site and leaves, we'll still work the lead, but won't put the same effort into it. It gives me a way to divide the work up better.

If they say over the phone their only looking at trucks, we'll look at their Website Activity profile (integrated into our CRM) and see they also looked at cars and suvs too. Hmmm...trucks only? The '70% will switch' rule is alive and well today, at least in the subprime market.

These tactics don't always work, in fact they fail more often than they succeed. But I can push the needle with them, and that's $$$$.

The iPhone was a game changer too. There was nothing on the market like it when it debut. It's UI was sleek. But, now you're seeing touchscreens on other phones. The 'iPhone' effect will directly impact us too. Our car buyers are being introduced to some snazzy tech. Then they go to a dealer site and YUCK.

What you saw on my website and the tactics I've describe here are 2 years old. I have a whole new bag of tricks I'm working on. I'm focused on providing an engaging, fun experience. We, as an industry, desperately need to add the 'fun' factor into the car buying process. It's easier said then done though. I'm still trying to figure it all out. I'm really just shooting from the hip and hoping something sticks. I don't know if something will work until I try it. But it's so important to keep trying - something more owners need to understand. Their Internet strategy should always be a 'beta' version. Stop moving and Internet wave will sink you.

I saw the compete.com page, your traffic is off the charts. How? SEM?

Regards,

Wayne

PS: Sorry for the long posts everybody. I've been out on an island (not literally) for a long time and don't ever get to talk about what I do.

My comments are for Wayne.

First of all... nice job with your customer testimonial videos. It's great to see some progressive guys out there getting it done. Regarding video, I'd be happy to give you some simple ideas about how to complete your "request a personal video" concept. Feel free to contact me through www.dealeradvisor.com if you'd like.

Lastly, why do you think SEM is 20th century? One thing I know is that there are many self proclaimed expert SEM companies knocking on dealers doors. Another thing I've learned through research is that they're not all created equal. SEM is another topic I'd love to chat about if you're interested. Best of luck in all things!

Wayne,
Very innovative work. Love your lead harvesting efforts, Internet Coupons that increase with additional participation, just dammm smart. Love the referal push, more smartness! Satisfied customer cam is friggin' brilliant! The "6 more photos avail..." yet another unique approach!

Oh sure there are things I don't care for, but who cares, every market is different and you're rockin over there!

Wayne, You and I are RARE in our industry. Creative Internet Directors are the wave of the future, see my recent rant: http://www.dealerrefresh.com/my_weblog/2008/01/pay-plans-back.html#comment-97404852 Your efforts NAIL my message:

"...if someone were daring, they may find more ROI by out efforting his competition with personalized content and services.

For the sake of argument...
If you sell 200 units per month and you have 2,000 unique visitors per month, that means 1,800 BOUGHT somewhere else.

Mr. General Manager, can you tell me where the dry gun powder lies?..."

We're not alone, our efforts are quietly happening here and there and I am on the look out. See My post "The winds of change are among us, enter in...the Game Changers."

Wayne, we are rare because your owner is rare. Your owner dares to do things diffferent. He comitts the cash and resourses to FUEL YOUR FIRE. jeremy Franklin is one smart dude, he knows who and how to hire and YOU are an important player on one hellofa killer team! KUDOS!

I am in the middle of a site wide, ground up makeover and I'd love to swap ideas. My site may look prehistoric, but the metrics are off the chart. http://siteanalytics.compete.com/usedcarking.com+jeremyfranklinsuzukiolathe.com/?metric=uv

I am going to retain the essential elements that keep the metrics high and work on improving deeper metrics.

I'd love the opportunity to swap stories and ideas, if you're ok with that flip me an email at joe[dot]pistell[at]usedcarking[dot]com and let's chat.

We Independant Site developement directors need to stick together. It's our effort and attitude that kicks the cookie cutters in the b*tt and bring value to our team.

Hope to hear from you,
Joe

Wow...

I hadn't been to DealerRefresh for about 5 months and coming back I noticed that the conversation has heated up considerably, that's great.

Good job Jeff for sticking with this.

This post and the follow-on conversation has struck a MAJOR nerve with me.

My 50,000 foot view is that our Internet vendors and consultants are FAILING US. If I just made a bunch of enemies, I don't care...it's time these guys are called out.

I'm talking mostly about the big guys...Dealerskins, BZ Results...those guys. (I know there are some small shops out there trying hard.)

Why are we as an industry behind the times?

I'm personally sick and tired of our industry lagging from an Internet technology standpoint. Its really our fault as auto Internet professionals for allowing this to go on.

Due to the unique nature of the car industry, we should be leading the way with Internet innovation in some areas.

I've been an Internet Director for 3.5 years for the same group. I taught myself web programming during that time because I didn't want a website with a hodge-podge (sp) collection of features that don't work in harmony.

I feel I'm in the trenches, which our vendors are not and that's the problem. While I try to think up a new process or piece software to push the needle, blaring in my ear is a 12-person call center literally 6 feet away from me. I get to hear hundreds of phone calls from customers. It's tough to concentrate sometimes but I like my unique vantage point. I like developing in the trenches.

Our vendors are not in the trenches. They'll use reports from NADA...or showcase some 'dealer success story' where they take a dealer from nothing to something and claim 1000% results. Please.

Do they realize our customers web habits are changing about every 6 months. Yesterday it was blogs, now its microblogs like Twitter.

Everything on the Internet is changing fast. I know. I have to purchase at least 6 new programming books every 4 - 6 months just to keep up.

I'm still getting calls from vendors pushing SEM as the thing. WHAT! That was 20th century crap.

Our lead providers still charge the same price they did years ago with ZERO innovation.

And we now have an Annual Conference that, quite honestly, is not helping the 'innovation' issue.

But I'm not one to just kick sand and complain...

I've put up a Satisfied Customer Cam on our website. Why am I the only one with this? Where are our vendors?

I'm working on a "Request a Personal Video" feature. Again, shouldn't this be something I'm getting a call from a vendor to purchase?

I'm nobody special, I just care...A LOT!!!!

Do our vendors really care A LOT about innovation or our success? They all will say they do. But isn't talk so cheap?

Are our industry Internet consultants overpaid? Are we really getting the best advice and ideas? How should the auto industry react to Google's OpenSocial or Android initiatives? What can we learn from Facebook, or how will the DataPortability initiative affect us?

These are huge topics on the Internet right now that have and will continue to change how the Internet is consumed buy our lovely Internet customers. And that should be important to us too. Move with our customer, not remain stagnant.

But I bet you won't get a call from some expert auto Internet consultant talking about these things. (unless they just read this)

James - Looking at other industries is a great idea, but there really isn't anything similar to the car industry. The sales transaction is unique. Homes take too long to sell. Art is a strange beast.

Brian - you need to add to your customer 'want' list:

I want to be entertained and have fun.

Sorry to vent. I guess I should get more involved with the conversation here and not let things build up.

Brian,
You figure out a way to take a tradein... and I mean ALL the way in, then your argument may gain some traction. Trade-ins are why the manufacturers aren't getting rid of dealers.

Hmmm... Let's toy with that.
Once your shoper picks a car, then you help the shopper LIQUIDATE their trade-in at POS (point of sale). EASY! You need to establish a market place to have retail sellers and wholesalers come together.

Ohoh, reality is coming!
Your prospective eCommerce shopper will bail on you once they find the trade-in's ACV (and they're $5,000 upside down).

hahaha...
ahem, sorry about that.
Don't use the ebay model to create parallels on your platform. It still an auction, and you're closer to landsend.com!

sidebar:
After 3 years in this industry and as an outsider looking in...
Gone are the days of a dealer bullying up their customers.
I USE TO FEEL SORRY FOR THE RETAIL CAR BUYER. NOT ANY MORE. THEY ARE SHARKS AND WORK HARD AT MAKING US SWEAT. IO, THE TABLES HAVE TURNED 180*.

The retail carbuyer is upside down and it's our fault! NOT. They ought to teach a class in High School about depreciation in HS. Buyers are mostly un-loyal and will tell you lies and half-truths to get the best deal.

Bitch and moan, whine and complain. These are the sounds of customers in denial. They ALL know that they loose $$ the moment it rolls off the lot. They all know the Banks get their finance monies 1st. Oh! they'll bitch, moan, whine and complain when that mean dealer won't offer them what the "need".

No Brian... hate to say it. "Avoiding Dealer Angst" is not going to fuel your business model.

eBay Motors sells $7B each quarter in cars as of 2005. That should qualify as conversion since it is not leads.

Just because your webite today isn't capable of real ecommerce doesn't mean that isn't what consumers want.

A 2% conversion ratio to an Internet lead means 98% of your visitors didn't like (for whatever reason) what they found at your website.

No website "converts" 100% as the other, simpler industries show.

Good website design with clear navigation, strong calls to action and relevant content are all worthwhile too.

So is having capabilities on your website to make the destination worth the journey to the consumer. As "call or email" is not a path to a better buying experience, 98% give up in frustration today.

Don't believe me? Grab 10 college kids and have them go to your site and ask them if they would use it to buy a car. Then point them to the demo on the Ai-Dealer home page and ask them "If one dealer allowed you to shop that way (completely online) and another did not, would that make a difference to whom you dealt with?" Now ask women buyers. Now as busy working professionals. Now ask all those consumers who have had a bad prior experience with a dealership.

Conversion ratio of what the site has and does today is the tip of the iceburg.

Sometimes you can learn from another industry so that you don't necessarily have to reinvent the wheel. Maybe like Mitch said another "high-dollar brick-and-mortar" industry might be able to provide some insight. I can't recall anything specifically but I have read business articles where a company or industry will look to other groups that have or are currently facing similar obstacles for metric and processes to help them. I would think perhaps high end furniture, jewelry or high end appliance makers like Sub Zero. Just a thought...

Right Joe, as much as people would like to point a snobby finger at automotive retail and say we're just simply behind the times in Internet Marketing (though it's true for the most part), conversion ratio is not one of the areas where this is a valid statement.

We are one of the few industries (actually I can't think of another besides real estate) where 99.9% of Internet prospects are NOT going to be making their purchase through our web site. Trying to track down success when success means "did we create interest in our store" is infinitely more difficult than tracking down success when success means "did they buy something".

That's why Brian's list above references transactions, and not leads... online retailers aren't ahead of us in conversion ratio - they just have a much easier conversion to measure.

If you're on LandsEnd.com, you're going to do one of the following during your visit to the site:

- Buy something
- Lose interest and exit the site

Now there are other things for LandsEnd.com analysts to look at of course, but which of the aforementioned actions is being taken is a great indicator for them. In fact, it's paramount. 0.1% of their customers are going to leave the site and hop down to their local Land's End shingle to try something on. It is simply not worth considering.

Now take JoeSchmoeHonda.com... a visitor's typical actions could be any of the following:

(Measurable)
- Submit a lead
- Call the 800 number
- Print something out and present it to the dealership
- Lose interest and exit the site
- Call an untrackable number
- Find something of interest, exit the site, and then come to the store

The problem here is that when you look at conversion ratios, the last three options on the aformentioned list all look like the same result: failure. Even the other elements, like calling the 800 number or bringing in a print-out, are only successful if someone actually finds out about it. There's a lot that can happen besides submitting a lead, and good dealership web sites will entice people to make those things happen.

Your dealership web site will never be Amazon.com. The site metrics are just not that simple for high-dollar brick-and-mortar industries. And if it ever does become that simple, we'll be out of a job, so I wouldn't wait around for that to happen if I were any of you.

Brain,
Your clearly one-hellofa-briliant guy. No one can argue that point. But you've baffled me, You write:

"...
Urban Outfitters - 15.9
Lands End - 15.4
The Sportsman's Guide - 15.3
QVC - 14.9

Yes the products are more simplistic than a car...".

Conversion stats like these are useless references to our industry.

==Does the QVC shopper have a trade in?
==Can you deliver a car via Postal Carrier?
==Lands End is Factory DIrect, can you buy a Chevy, Factory Direct?
==Can you goto an Urban Outfitters store and negotiate a better deal than online?

See what I am saying? Industries are unique and BUYERS are very, very smart.

EXAMPLE:
Take a flight and get a rental car.
Flight: Book and pay for the flight 100% online.
Rental: Reserve the car rental to secure your rate but dont pay. Fish for a better deal when you arrive, works every time!

Conversion rates cannot cross industries.
Joe

Ever read that "car dealers lag other industries" and wondered what was meant.

Check this link out... top company website conversion ratios (and they mean "those who bought not submitted inquiries / leads"


Coldwater Creek - 23.7
HearthSong - 21.9
Tickets.com - 20.1
Lillian Vernon - 20.0
Roamans - 18.9
Oriental Trading Company - 16.9
Urban Outfitters - 15.9
Lands End - 15.4
The Sportsman's Guide - 15.3
QVC - 14.9

Yes the products are more simplistic than a car, but eBay has proven that it can be done ("a car every 60 seconds" is the quote I remember).

Don't strive to be the tallest dwarf.

RE: I am working on ways (ideas) to get get visitors to reveal themselves. If anyone has any ideas, let me know. - Joe Pistell

Hey Joe,

3 things I have seen high ROI's on to capture your customer's info on your website to turn browsers into customers.

1. online chat - outsourced
2. pop up coupons - $250 for info then double coupon if they set the appt.
3. blackbookonline trade values

also, here is an old but good article related to this post.

The idea that a website's conversion ratio as a silver bullet indiciator of success is correct. However, it can not be ignored entirely either.

Site design has much to do with overall "Persuasion Architecture" (how well does your site get its visitors to do what you want them to).

I hit dealership sites constantly where I am usually, tragically and utterly lost as to what the person who designed the site was thinking that visitors to their site might want to do when they got there. It certainly isn't to read through every page on the site, nor click through various banner ads, nor watch commercials.

I want to buy a car.
I want to service my car.
I want to buy a part.
I want to call, emailo come to you.

Everything, and I mean everything else needs to be put in this context.

Traffic, clicks, hits, conversion, etc. are all just canaries in the coal mine to the only true metric which has ever mattered... ROI...

Spend this (in dollars, money, people, effort and technology - SEM, SEO, website design, PPC, banner ads, CRM, blogging, social web, etc.) and you will get that.

Are lead volumes falling. Of course they are. As Alex Snyder pointed out, consumers have figured out that "leads" are a path to getting a phone call and request for a dealership visit not a path to a better buying experience.

Do dealership website conversion metrics fall along with this increased consumer awareness? Of course they do.

Focus on ROI... it is timeless.

If you don't like the picture it paints because you try to use price to compete on the Internet... time to develop a better online buying experience... this thinking was one of the drivers behind the shopping cart service we developed at www.ai-dealer.com. Let consumers self-serve their own vehicle purchase from dealers. Require an email address in order to get more than MSRP info. Engage in the real online car buying experience where the consumer is - online and not try to divert an online experience into an offline one.

Jeff has a book by Bryan Eisenberg on this blog (Waiting for your Cat to Bark). If you really want to understand how good your website is at its job, buy the book or their even better one titled "Call to Action".

If you want to get a website worth having, get one from someone who knows how to build a good one. I like www.motorwebs.com but I have no relation to them.

If you want a website where the journey is worth the destination for your consumers, get one that can transact. Try Ai-Dealer or Ralph Paglia at ADP for shopping carts for vehicles, try TimeHighway or Xtime for online service scheduling, try Insignia Group for online accessory purchases.

Market your dealership as "the best dealership to do business with - online or offline." Have a website with easy to understand (from the consumer's standpoint) layout, design and capabilities that they actually care about (transactional websites).

Don't be the best 20th century dealership, be the best 21st century dealership.

Where I am at right now is I tend to think that we've got an input problem.

The vast majority of our traffic will visit our sites and won't show up as a measurable lead that can be assigned to a sale. We all know we're in an old-fashioned horse trading business where the majority of customers prefer to shop stealth.

Are email quotes going the way of Cassette players?
Nearly a year ago, our infamous Alex Snyder made mention that email quote volume is falling. Customers are into their 2nd or 3rd net based purchase and have they found real value in the email quote system?

Post sale surveys help us connect the dots because buyers can now reveal themselves. Our avg. shopper is shopping for 3 weeks and visits 2-3 dealers before we close 'em. I like watching the % of returning visitors as a metric that reveals value to our visitors.

I am working on ways (ideas) to get get visitors to reveal themselves. If anyone has any ideas, let me know.

I am in NY and I've always admired Chapman''s in-house efforts. Take a look at: http://www.chapmanchevrolet.com/preinv.asp

I have been watching them for years and they've held onto this "Unlock Price" model. It obviously is working. I haven't had a chance to call them to send them an "atta boy" (they've always been ahead of the curve, rockin' in SEO SESRP's before it was cool!).

Joe

Mitch -

You address some great points, but let's look at the dealer website movement from a 50,000ft view.

- From 2000 to 2006ish, dealers were just happy to display their inventory online with a cool looking web presence. The science was simple: I have a website and sold X number of cars.

- In late 2006 to 2007, dealers began thinking hmmmm how can I drive more traffic and get more leads then sell more cars. The science again was simple: I have a cool website with X hits per month generating X leads, and I sold X number of cars.

- Now the movement is getting more in line with your points where there is more of a real science or metrics to the formula for online selling. Online merchants have been here for years, but the automotive market is always about 2 years behind the technology curve.

In conclusion, what will happen going forward is dealers looking for website solutions that are conversion focused. They will want to create an A/B testing environment for landing pages, add social media sites to their marketing mix, and build micro-sites for cross linking of sites and SEO. They will also look for one system to track the lifecycle of a lead through the entire process.

There are a lot of details left out of my comments, but again this is just my high level view.

Chad Polk
AutoRevo.com

This is a great post. What can be more important for Dealers in 08 than measuring their website conversion %? I would argue a point seemingly left out in the discussion. What about the science/technology allowing for the measurement? Where are the standards and how are they being applied by the CRM's and Website Development folk? Why is unique visitation data variable from source to source? How does anyone truly measure how many people came to their site-from where and did what? And is this "measurability" analyzed over any quantifiable time frame? Until somebody somewhere comes up with "Universal Measurement Criteria" governing all of this, it's still smoke no matter who reports, dissects or spins it.

Laura,

Great posting! I didn't see who wrote this until I got to the bottom of the posting and your stats were right on with the results we experienced when I was at Phil Long and utilized the CIMA System.

I was going to send this to Barbara and Gary before I saw it was you, LOL!

Great Job!

Gilbert

This is interesting stuff that is rather basic but critically important. As our stores turn to more email marketing with things like newsletters, video and blog offerings (not to mention monthly email "specials" campaigns and quick quote replies) the biggest challenge we have is getting into a person's "inbox" and not the "spam" folder. Currently, Reynolds doesn't provide us with a way to measure our email effectiveness. IMN's newsletter metrics does do this with outstanding detail and it is a great tool. I know other postings have been made stating that we shouldn't do mass emails through our CRM or ILM but rather through an Outlook account or something of that nature. That is a difficult thing to do especially if you have a ton of email addresses. If there was a third party software application out there that we could integrate into our CRM to help us measure the effectiveness of our email that would be great but I have yet to come across one. Bottom line: once your domain name is blacklisted by an email provider it is hard to get off that list without people voluntarily adding you to their safe senders list. Most customers don't even know what that is.