The times have changed
For years in the SEM world, we have advised dealers to not spend too much money on branding. Now, the times have changed.
It’s hard to spend money on what is not there, i.e. Inventory.
No inventory means no money spent on that 2021 Chevrolet Silverado keyword or any other year, make, model combination.
However, the increasing price of used vehicles just doesn’t make sense for some dealers to keep going back to the auction. I’ve had some conversations with several dealers that are getting $3-4K more at auction then they would at retail. Pretty soon there will be a balloon pop and all of that overpriced inventory won’t be able to be sold without taking a huge loss.
The problem with “buy back” campaigns is that they can be costly if you’re not in the right market. Generally, they cost more per click, all while getting a lesser CTR and conversion rate. Even if we are able to get a conversion (form fill) on these campaigns, BDCs chase and chase after the customer to even get them to come in for a no hassle, free appraisal. If not in the right market, these “buy back” campaigns can be a waste of advertising and labor dollars.
SO WHAT IS LEFT THAT WON'T COST AN ARM AND A LEG?
Spend those marketing dollars on:
- Generic display ads
- Generic search terms
- Generic video campaigns, etc.
Pause model specific campaigns, including all of those 3rd party listing sites that take up over half of your marketing budget.
The further up the sales funnel dealers can focus on right now, the better. Without inventory on both sides of the dealership, it makes it tough to go after that low hanging fruit, because after all, the chances of having that one specific vehicle that one customer is searching for are very slim.
Eventually, inventory will be back to normal and dealers can spend money on model specific campaigns and 3rd party listing sites again. As long dealers aren’t overpaying for their used inventory right now, low hanging fruit will be back on the menu soon but until then Brand, Brand & Brand.