Automotive Advertising Agencies Monetize Social Media by Integrating it Into Selling Processes

Updated: September 18, 2010

The world wide web has matured as an efficient information resource to replace the real world auto dealership as the place of choice for car shoppers to gather the information they need to select a vehicle and a dealership -- in that order! Internet based social networking is the virtual version of a Chamber of Commerce, the Rotary Club, Community Event, Fraternity, etc., linked together by a technology that serves as a central communication and distribution tool.

The importance of relationship based selling in the real world is supported in every sales training manual based on the observation that people like to do business with people that they like. The logic to Sell yourself, sell the dealership, sell the vehicle and then justify the price is an accepted wisdom that is based on the one constant that has survived in both the real world and the world wide web -- Human Nature! Internet based social networks represent an online community of like-minded consumers who have a strong influence on their online friends. Auto dealers must invest and involve in these online communities as people not as an auto dealer.

They must prioritize the interests of their new online friends before, during and after their buying cycle to earn their trust and consideration when they have a need for a new vehicle or to service their present one. After all, what are friends for!

Once a need has surfaced it is critical that the transition from casual conversations to focused selling processes is transparent and comprehensive to move the consumer seamlessly through their online shopping experience. Technology can communicate the information needed by both the consumer and the dealer to move forward into a transaction. However, the processes must build on the personality and relationship built on the social networking site that surfaced the opportunity. The unique differentiator between the dealers down the street selling the same product is not the price, but the people that started the dialogue built on an earned relationship and trust.

Viral marketing is a natural extension of social networking that distributes a message in such a way that it will be forwarded by the recipient in a geometric progression enhanced by its valued content, unique creative, entertaining production or some quality that will motivate the initial consumer to share it with their spheres of influence. The exponential growth of this type of online distribution channel affords an extremely cost effective media to distribute the initial message to a diverse audience that may or may not be interested in the content, but even a small percentage of conversions represent a superior short term and quantifiable R.O.I. to conventional marketing media. The buzz created by the extended online community also develops long term branding recognition that enhances the reach and frequency of the message with less measurable results but similar value in developing top of the mind awareness for future customers.

By extension, social media as it is applied for the purpose of marketing for the retail auto industry is a channel for distribution of both viral and targeted marketing messages through controlled blogging forums as well as expanded spheres of influence through online communities such as Twitter, Face book, LinkedIn, Naymz, YouTube, etc.

These online social networking communities have unique profiles that attract different types of users. Twitter and Face book, for example, are more universal and personal in nature while Naymz and LinkedIn are more professional and focused on business to business networking with YouTube using video to express the message. These online communities will be part of your extended social media channel, however, more specialized networks targeted to the auto industry should be the core channels based on their applicable content, audience and related links.

It should also be noted that recent market studies confirm that the efficiency defined by Twitter - in that they limit their postings to 140 words - has served to differentiate them from other sites with a superior growth curve to prove it. Conversion rates from Twitter users who access online banner ads or similar commercial messages are twice those of social networkers who do not have Twitter in their online profiles. The revelation is that many online networkers are overwhelmed by the fragmented online communities that they participate in and limited time requires them to seek out more effective ways to manage their online and real world lives.

New platforms that link these diverse online communities into one central access point now exist that provide efficiencies beyond those provided by any single site. Power.Com -- for example -- functions as a layer or home page that represents this one stop social networking site philosophy. Newly developed marketing platforms serving the auto industry, like ronsmap.com, integrate social media with their vehicle listings with localized search engine functions -- think Google Local!

I should disclaim that ronsmap is a vendor client of mine, however that simply reflects my confidence in their unique platform and the fact that I practice what I preach. I selected them to solve a problem for my auto dealer clients and I suggest that other automotive advertising agencies need to address those same problems for theirs. ronsmap is a game changing online car buying/selling site for both consumers and dealers that makes car buying fast, comprehensive, transparent and live. Their proprietary technology gives customers unparalleled buying and negotiating power over the car buying/selling processes including the opportunity to accommodate For Sale By Owner listings. It provides auto dealers with unprecedented levels of sales intelligence on consumer leads and it enables automotive advertising agencies to promote and engage consumers via social networks.

The ability to offer both B2B and B2C marketing messages supported by relevant social networking forums is an efficient combination of business and pleasure that will attract today's time challenged consumers. Of course, business opportunities must be subordinate to providing relevancy and interesting content to the end users -- the car shoppers -- however, the convenience of providing a locally targeted inner circle of connected real world friends through an online communication tool is an example of the leveraged and efficient resources that are emerging on the Internet.

Marketing to consumers in social networking communities requires resources, tools and skill sets to compliment and supplement auto dealers existing online selling efforts and ronsmap provides all of these elements in a cost effective scalable manner while delivering market intelligence that enables the auto dealer to maximize their conversion rates and preserve gross profit in their online negotiations.

Finally, many dealers have learned the value of integrating customer generated content onto their websites through blogging forums and other methods to present past and present customer experiences to potential future customers. These dealer sponsored social networking platforms are often suspect and dealers tend to filter negative comments on their own site which limits participation by customers and adversely impacts the confidence of visitors in the value of the content.

A more proven platform has been for auto dealers to support third party micro-sites that distance the dealer from the online community. The site can then expand on the messages it presents to include issues of interest to potential customers. Links to community organizations and related information resources supported by the dealer do not require a sales message, which would likely alienate the online community. The value of developing relationships with the site visitors on the common ground of your shared support for the activities coordinated on the site will plant the seed that will grow when they are looking for a friend in the car business.

The agenda of participants in social media and social networking does not include commercial messages as it is primarily an online platform to build relationships and share information. On the contrary, any commercial abuse of a social media site will alienate users and create negative backlash. That said, as previously stated, human nature has survived from the real world to the virtual world and people still prefer to do business with friends -- real or virtual. As long as the sales message is secondary to providing valued content or is placed in the context of a relationship focused community with shared interests then the ability to develop sales is both measurable and assured.

Viral marketing and social media have cost advantages over conventional media -- including radio, TV, print, direct mail, etc. -- as well as online investments in search engine marketing, (SEM) -- such as pay per click and banner advertisements -- since there is no direct costs. They are similar in their R.O.I. and value to Internet based search engine optimization, (SEO), with comparable indirect costs in that they are labor intensive. However, properly leveraged reciprocal links and automated content provided by RSS feeds from related online sources can be integrated to reduce the labor for both content and distribution enhancing the R.O.I. even after the cost of labor is considered.

An additional unique value of social media is the increasing importance of relevancy and consumer generated content in consumer preference in their selection of sites as a resource for information. Improvement in conversion and bounce rates, time on page and a number of other site analytics can be directly attributed to improved relevancy and consumer content -- as is provided by social media when properly integrated with a website.

More significantly, is the resulting impact it is having on search engines such as Google in adjusting the algorithms that establish both page rankings and even costs associated with their pay per click programs. Also, the constantly changing messages provided by user generated content on the posting site improves its SEO. The importance of relevancy has been firmly established by both consumers and the search engines insuring that its impact on Internet use will increase as should your focus on it.

A less obvious but equally valued aspect of the use of social media to extend your marketing plans is the evolution of the use of the Internet by consumers to be more of a pull/push media vs. the old world marketing logic of push/pull. The Internet has allowed consumers the freedom to gather information from a variety of online resources to avoid the sales hype and self serving messages used by advertisers in other media.

The recognized preference for consumers to rely on referrals and shared personal experiences from third party sources and "friends" has been enhanced by the Internet and, more specifically, social media which has been shown to provide a stronger influence on consumers than both conventional and other methods of Internet based marketing efforts. Leveraged resources in the auto industry social networking arena provide consumers, auto dealers and vendors with the inside story on the auto industry. These site offer shared content by direct and indirect links with other established social media networks as well as specialized auto industry networking communities in consumer/dealer/consultant/vendor facing forums.

It is important to note that the messages and even the portals themselves are established as open forums with minimum self serving or obviously commercial elements. Of course, the underlying purpose of many of these sites is to enhance the SEO and relevancy of the auto dealer participants and all of the contributing members. However, social media rely on relationship based communications. If a site is perceived by consumers as being self serving or commercial it will be shunned by consumers.

The demand by consumers for transparency on an auto dealer's website is coupled with the auto dealer's need to convert these virtual customers to real world selling opportunities for vehicle sales and service. The following online processes are designed to replicate and integrate with established real world selling systems without offending the online shoppers by delivering the information that they need, when they need it -- which is immediately!

1) Meeting and Greeting: Meeting and greeting is step one in both the real and the virtual world. If a customer walks into a showroom he expects to either find the information he wants or to be directed to where he can find it. Conversion tools allow a pro-active engagement with an invitation to answer a customer's questions.

AutoTransaXion -- another vendor client of mine that I chose for my auto dealer clients that exemplifies the problem and the solution that I am referencing in regards to customer communications on an auto dealer's website -- links with the dealer's DMS and CRM to integrate with established real world selling systems. More uniquely, their two way video customer interaction platform replicates the human experience" for relationship based communications.

Most chat programs offer a staffed solution to supplement -- or even replace -- an auto dealer's sales or internet staff in processing internet leads sourced from the site. Justified cuts in expenses by auto dealers struggling to adjust fixed and semi-variable expenses to be in synch with reduced profit margins and sales volume has forced many dealers to reduce the efficiency of their selling processes on both their real and virtual showrooms. The ability to add a remote staff to instantly respond and process online sales and service opportunities in a consistent manner can either supplement existing staff or extend the online showroom hours to a 24/7 schedule.

2) Initial T.O. + qualifying + feature/benefit presentations: Chat programs provide a real time interaction which can be used to accommodate an initial T.O. and to initiate an interview to qualify the customer's needs. Once their needs are determined, the application continues in a push/pull manner to present information on a variety of vehicles.

3) Inventory walk and test drive: The use of videos in conjunction with embedded links to relevant information, such as Car Fax reports, combined with a list of comparable vehicles based on the customer's needs, can replicate the consumer experience in the real world.

Yet another vendor client of mine that I chose as an example of best practices in this arena is SiSTeR Technologies Video CarLot. Their automated video production service can convert an auto dealer's online pictures into a professional video with human voice as well as the ability to integrate existing video content into the stitched pictures provided on the dealer's website. In addition, multiple schema layers linked to a dedicated micro-site -- vShock -- provides an extended marketing platform for similar inventory on the dealer's website. This process will narrow down the inventory to a short list of possible vehicles to allow the online selling process to continue into relevant negotiations and in some cases even to an actual online transaction.

This application also integrates a lead conversion form that is directly sourced back to the video posted on the dealer's website, third party advertising sites and even on the search engines as a unique URL linked to the video posted on You Tube through a dedicated API that delivers the vehicle with integrated meta tags and search words tied to the vehicle as well as links back to the posting dealer's website in synch with their established S.E.O. programs. (vSEO)

4) Trade-in evaluation and negotiations: Many chat programs -- yes, including my vendior client AutoTransaXion -- include the ability to request pictures and details on a trade-in that will provide sufficient information for a dealer to establish an actual appraised value subject to confirmation at the time of delivery. Similarly, since the applications are often linked with the auto dealer's DMS, the first pencil can be delivered at the point of first contact with actual negotiations in a similar fashion to established real world selling processes.

5) Online transactions and delivery: Interactive customer interaction platforms can complete a negotiation and process all customer and vehicle information directly into an auto dealer's DMS and CRM with the ability to push all forms needed to consummate a sale. The dealership can then deliver the vehicle along with the appropriate paperwork. The delivery can be scheduled at the dealership to avoid right of rescission rules that exist in many states. It should be noted that even if an appointment is made at the dealership the process will be greatly enhanced by the online communications that preceded it.

6) Follow up for sold and un-sold units: Database marketing for sold and unsold customers has existed for many years, however, matrix based automated solutions have been extremely limited. State of the art CRM tools and similar third party marketing platforms provide a custom follow up to any customer that has been entered into a dealer's database. The messages can be delivered via email or direct mail with a personalized message drawn from the initial contact.

The ability to select comparable vehicles for the ongoing consideration of unsold customers is another element of the more sophisticated applications that are being applied today. The contact can include current price information including factory incentives, interest rates and payments to address issues that may have prevented the initial sale.

In addition, some more forward thinking providers use third party resources to determine if a customer has already purchased a vehicle -- even if from a different dealership -- so the message can be converted to a service offer rather than a sales message that will be ignored by the customer. Sold customers are also included in the process with service offers and customer satisfaction messages to supplement the dealer's existing CRM functions.

7) Inventory management and ongoing online marketing: It is an accepted wisdom that dealers make their money on Used Cars when they buy them, not when they sell them. Inventory management systems like AAX, vAuto, eCarList and FirstLook are not vendor clients of mine, however I do recommend them to my affiliated automotive advertising agencies for theirauto dealer clients.

Each of these vndors provide applications that use historical sales data as well as current online postings in varying ratios of relevancy to assist in the appraisal process. Extended and integrated marketing platforms also seamlessly place the newly acquired inventory onto the dealer's website and third party advertising sites. Since time is money the faster the vehicles are placed on the virtual inventory and online marketing plan the sooner they are sold and the profit is turned into another vehicle.

FirstLook has the unique ability to apply their proprietary algorithm to design the copy of the online ads for the vehicles using their Consumer Optimization process to prioritize the features and benefits for each vehicle to exactly match proven customer preferences. This automated production process increases conversion and profits from the posted ads and additional features and functionality are planned to further enhance the ads. (Can you say VIDEO!)

All of the issues discussed in this article can be referenced to the key differentiator between conventional advertising/marketing and the newly maturing position being reserved for social networking. For example, customer reviews exist in most retail verticals on the World Wide Web and the auto industry is no exception. While the importance of this component of many social networking site can't be over emphasized, it is only one bullet in the gun of auto dealer's that are constantly expanding their investment in reputation management and branding through the use of their social networking/marketing plans.

Web 2.0 has become an established buzz for today's automotive advertising agencies but User Generated Content, (UGC), has earned a position in their vocabulary in a variety of forms. Social Media -- for example -- references communication technology offered in a public forum that allows users to interact and contribute shared content through a variety of tools including forums, blogs, Weblogs, networking communities, wikis and radio podcasts -- like my own blog talk radio shows on AdAgencyOnline.Net.

Social Marketing describes a grouping of social media tools that provide direct personal relationships with a targeted group of customers. Social Networking Sites include well recognized online communities like Face Book, Twitter, Bebo, MySpace and newly maturing centralized aggregator sites like ronsmap.com that allow people to connect with old and new online friends through personal profiles that define their shared interests in both the real and the virtual world on an individual basis as well as with groups that they have in common.

The growing acceptance and recognition of these various and related facets of the new phenomenon of Social Networking is built on established business and advertising marketing principals enhanced by the new language of today's Internet and technology driven auto industry. They all recognize the importance of relationship selling and branding to supplement and compliment -- not replace -- conventional calls to action and direct selling messages.

The search engines are also playing a growing role in the acceptance of UGC and the importance of reputation management with the development of new tools -- like Google's Sidewiki -- that provides site visitors with a text box to post their opinion of an auto dealer's website to future visitors. They have an added self serving agenda to eventually sell this data and information to potential online advertisers since the application also tracks the user's history on the Internet but it raises the importance and urgency of protecting auto dealer's online reputation to a new level!

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