Yt for auto dealers 104 final

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Yt for auto dealers 104 final

  1. 1. Selling Cars with Google 104: US Online Automotive Dealer Advertising Executive Survey Jupiter Research 1
  2. 2. Internet Generating New Car Sales Leads A dealer survey revealed that the portion of dealers generating over 10% of their new car sales from online leads jumped from 36% in 2004 to 51% in 2006. Internet-Generated New Car Sales 2004 - 2006 70% % of Dealers by Internet-Generated Sales 59% 60% 55% 2004 51% as a Share of Overall Sales 2005 50% 2006 40% 38% 36% 34% 30% 20% 15% 10% 7% 5% 0% More than 10% 10% or less Not sure/don't measure JupiterResearch/NADAguides.com Executive Survey (7/07), n = 106 (US); JupiterResearch/NADAguies.com 2 Executive Survey (9/06), n = 98 (US); JupiterResearch/NADAguies.com Executive Survey (5/05), n = 162 (US)
  3. 3. Internet Generating Used Car Sales Leads A dealer survey revealed that the portion of dealers generating over 10% of their used car sales from online leads jumped from 40% in 2004 to 56% in 2006. • Used car sales tend to be more profitable, making this a critical aspect of a dealer’s business Internet-Generated Used Car Sales 2004 - 2006 60% 56% 54% 54% % of Dealers by Internet-Generated Sales 50% 2004 as a Share of Overall Sales 43% 2005 2006 40% 32% 30% 20% 12% 10% 10% 6% 6% 0% More than 10% 10% or less Not sure/don't measure JupiterResearch/NADAguides.com Executive Survey (7/07), n = 106 (US); JupiterResearch/NADAguies.com 3 Executive Survey (9/06), n = 98 (US); JupiterResearch/NADAguies.com Executive Survey (5/05), n = 162 (US)
  4. 4. Dealers Increasing Online Ad Spending Survey data reveals that 47% of dealers in 2006 allocated over 10% of their overall marketing budget to the Internet, up from 35% in 2005. • 43 % of dealers spent more than $30,000 in online advertising in 2006, up from 14% in 2003 • 28% spent over $50,000 in 2006, up from an average of 12% between 2003 & 2005 Dealers’ Online Advertising Spending 2003 - 2006 50% 2003 2004 45% 43% 2005 2006 40% Percentage of Dealers 35% 34% 31% 30% 27% 25% 24% 24% 23% 22% 22% 20% 20% 19% 15% 14% 14% 15% 13% 13% 13% 12% 11% 10% 8% 5% 0% Less than $5,000 $5,000 to $10,000 $10,001 to $30,000 More than $30,000 None/not sure JupiterResearch/NADAguides.com Executive Survey (7/07), n = 106 (US); JupiterResearch/NADAguies.com Executive Survey 4 (9/06), n = 98 (US); JupiterResearch/NADAguies.com Executive Survey (5/05), n = 162 (US); JupiterResearch Executive Survey (7/04), n = 133 (US)
  5. 5. 2007 Dealer Internet Ad Spending Growth Survey data reveals that 47% of dealers are increasing their online ad spending in 2007, while 44% said they were maintaining current spending levels. • Dealers who are able to successfully convert leads into sales are more likely to increase their online advertising budgets (60%) vs. those who are not as successful (35%) Expected Change in Dealers’ Online Advertising 60% Spending by Lead-to-Sale Conversion Rates 54% Conversion rate of new car leads to sales greater than 10% 50% Conversion rate of new 44% car leads to sales equal to 10% or less 40% 30% 30% 22% 20% 16% 13% 10% 7% 7% 4% 2% 0% Increase by 25% or more Increase by 1 to 25% Stay the same Decreased by 1% to 25% Decreased by 25% or more JupiterResearch/NADAguides.com Executive Survey (7/07), n = 43 (dealers w/conversion rate of new car leads to sales 5 greater than 10%, US), n = 46 (dealers w/conversion rate of new car leads to sales equal to 10% or less, US)
  6. 6. Dealer Online Ad Spending Breakout Dealers spending <$30,000 in online marketing tend to spend more money on third-party lead sources than any other online advertising tactic. Dealers’ Online Advertising Budget Allocation 60% Dealers with online ad spending less than $30,000 50% 49% Spending Allocation per Tactic Average Online Advertising Dealers with online ad spending greater than $30,000 40% 31% 30% 28% 28% 20% 17% 15% 11% 10% 7% 5% 4% 3% 2% 0% Third-party Online Search engine Online Special lead Other sources classifieds keywords sponsorships/ sources banner type ads JupiterResearch/NADAguides.com Executive Survey (7/07), n = 53 (dealers w/online advertising spending of 6 $30,000 or less, US), n = 45 (dealers w/online advertising spending greater than $30,000, US)
  7. 7. Dealers are Utilizing Paid Search & Display Survey data shows that 74% of dealers are planning to use paid search & 66% are planning to use online auctions in 2007. • This is an expected increase of 85% in the use of paid search & an expected increase of 47% use of online auctions in comparison to 2006 • 61% are planning to use display advertising in 2007, an increase of 47% from 2006 100% Dealers’ Use of Online Advertising Tactics in 2005 & 2006, 92% Planned Use in 2007 90% 82% Expected 2007 80% 79% 76% 76% 74% 2006 70% 66% 2005 62% Percentage of Dealers 61% 60% 51% 50% 47% 45% 43% 40% 39% 40% 30% 20% 10% 0% Third-party Online Search engine Online Online sponorships/ leads classifieds keywords auctions banner-ad types JupiterResearch/NADAguides.com Executive Survey (7/07), n = 106 (US); 7 JupiterResearch/NADAguides.com Executive Survey (9/06), n = 98 (US)
  8. 8. Dealers Use Online Advertising for Branding Survey data demonstrates 74% of successful dealers (those who convert more than 10% of Internet leads into sales) use online advertising to increase the number of email leads. Only 51% of less successful dealers invest in online advertising to increase e-mail leads. Reasons for Dealers’ Online Advertising Usage 100% by Share of New Car Sales Generated Online Percentage of Dealers That Advertise Online, 91% 90% More than 10% of new car sales generated online 80% 74% 10% of fewer new car 72% 71% sales generated online 70% 69% 63% 60% 54% 51% 50% 40% 30% 20% 10% 0% Driving traffic to Increasing number of Increasing number of Display inventory dealership website email leads phone leads online JupiterResearch/NADAguides.com Executive Survey (7/07), n = 54 (dealers w/more than 10% of new 8 car sales generated online, US), n = 36 (dealers w/10% or fewer new car sales generated online, US)
  9. 9. Dealers Use Online Advertising for Branding Survey data demonstrates that 82% of successful dealers (those who convert more than 10% of Internet leads into sales) use online advertising to increase the number of consumers who see the dealership name. Only 69% of less successful dealers invest in online advertising for branding. Reasons for Dealers’ Online Advertising Usage 90% 82% by Share of New Car Sales Generated Online Percentage of Dealers That Advertise Online, 80% 76% More than 10% of new car sales generated online 70% 69% 10% of fewer new car sales generated online 60% 57% 56% 50% 46% 40% 30% 20% 10% 0% Increasing number of consumers Increasing dealer’s Building customer who see dealer name brand awareness loyalty JupiterResearch/NADAguides.com Executive Survey (7/07), n = 54 (dealers w/more than 10% of new 9 car sales generated online, US), n = 36 (dealers w/10% or fewer new car sales generated online, US)
  10. 10. Dealer Online Advertising Challenges 55% of dealers surveyed claim that determining which tactics will yield the highest-quality leads is their biggest challenge. Almost all dealers find it difficult to plan & implement online advertising. Notice that only 19% cited competition with offline media budgets as a challenge. Challenges Dealers Face in Planning & Implementing Marketing & Advertising 60% 55% 50% Percentage of Dealers 40% 38% 31% 30% 26% 26% 26% 20% 19% 14% 10% 7% 0% Determining Internet Lack of Performance Increasing Capturing Competition Management Don’t see any which advertising & staff that tracking competition valid lead with offline commitment challenges advertising & marketing is understands online information media budget w/implementing marketing getting more how to use online tactics bring complicated online marketing the highest everyday marketing & quality leads advertising JupiterResearch/NADAguides.com Executive Survey (7/07), n = 106 (US). 10 Question: Please indicate top three challenges in planning online marketing & advertising. Select up to three.
  11. 11. Key Takeaways Dealers are generating more new & used car sales leads from the Internet. However, almost all dealers still find online marketing & advertising challenging to plan & implement. Dealers are utilizing online advertising for both lead generation and branding purposes. Planning & implementing online advertising is easier than it seems! You can learn how easy it is to actually plan & implement online advertising. More information is availabe at: www.adwords.google.com 11
  12. 12. Thank you & stay tuned for future videos… 12

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