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Are Dealers Spending Too Much On Paid Search?

Ed,

Great question. After talking with hundreds of dealers this year alone I saw firsthand many dealers who were in fact spending too much.

Many were ruining their organic results with too much branded spend, while others were left with batch & blast plain-vanilla ads inside unorganized campaigns with no attention given to negative keywords.

The end result, insanely high CPCs and unfortunately low conversions. And I mean true conversions with regards to measurable actions such as lead form submissions or phones calls - not a page destination.

The game has changed, yet dealers are left with using outdated methods which prevent them from providing highly relevant, contextual campaigns.

Dealers need to get back to following the DISC rule - does it sell cars? Many just don't know the answer to that question.
Thanks for the great analysis @emiltsch. As you know, I'm not convinced that a lead form submission is should be a dealers highest aspiration, but a more targeted SEM spend, backed with more advanced analytics, can help dealers make decisions based on what really influences consumer purchase decisions -- “The 5 Auto Shopping Moments Every Brand Must Own”
 

✨ AI Highlights

The thread debates whether dealers overspend on paid search advertising, with Ed Brooks (from Cars.com) arguing that while paid search has a place in budgets, many dealers may be spending disproportionately given diminishing returns, while other participants highlight that dealers are often being overcharged for ineffective services. A key consensus emerges around the need for proper ROI tracking: most participants agree that dealers can't determine if they're overspending unless they measure results from keywords all the way to actual sales in their DMS, rather than relying on vanity metrics like clicks and impressions.

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