Kyle this is good food for thought....finally someone brought this up. I did not know that you could block these ads as well .

hey kyle, good info here.. I didn't know ad blocking on mobile was a thing.  What's a good one to use?  also, are you saying dealers can pay to be in snapchat feeds?  That would be cool.  Could you reformat this article? super tough to read b/c of the spacing!

I’m not disputing the content of your blog post, but I do not feel that Ad Agencies or Marketing companies are out to deceive auto dealers, but they work in a tough environment and often don’t get clear direction from their clients.  This means the ad agency will run the same sort of digital banners and TV commercials that dealers have done for the last few decades.  Measuring effectiveness with view and click stats doesn’t tell the whole story.  The key is the “message” in those banners. If it’s just a price ad, or “see us for a good deal”, then for the most part these are a waste of time and money.

Your stats also indicate and confirm that most online consumers ignore banner ads so putting a big budget into digital banners, pop-ups, and text ads is often a big waste of money. 

I believe the most effective marketing programs provide a hybrid-solution that integrates digital, social and local engagement strategies, but unfortunately most dealers don’t have the desire, resources, or will to implement these types of programs.

Thanks Mark.

Christian - they cannot pay to be in Snapchat feeds, but they CAN create custom geofilters or explore other types of Snapchat advertising...in addition to creating their own identity on there.  As far as spacing goes, you've got me....looks totally normal on my screens.  Happy to email you a hard copy.  Here's some info on ad blockers: http://www.nytimes.com/2015/10/01/technology/personaltech/ad-blockers-mobile-iphone-browsers.html?_r=0

Mark - I'd agree about the lack of direction.  But I'd also suggest that it's the responsibility of the agency to guide in that direction.  Not all agencies operate in a shady manner, clearly, but let's keep in mind that many...including the two big "3rd party inventory companies" (we all know the two I'm talking about!) are known for skewing metrics to best showcase what looks good for them.  And for the record, I entirely agree with you regarding hybrid marketing!

Great article Kyle. Curious, what do you consider to be the "industry average" CTR and if you were a dealer, how would you define a successful display ad campaign?

Interesting article. However, your premise for ad agencies deceiving dealers is based on impressions metrics for display ads and how agencies will pump that up. Haven't auto dealerships moved to a CPC model - even for display ads? Essentially going from "eyeballs everywhere" to "engagement everywhere". Doesn't that make impressions irrelevant make metric much more difficult to "pump up"? Lastly, on a similar vein, I invite you to read a blog article from our VP "Why Do Dealerships still Run Display Ads Even Though They Suck" 

Oops, Bad Grammar! I meant to say "Doesn't that make impressions irrelevant as CPC performance metrics are much more difficult to 'pump up'?"

The bigger problem isn't display versus other mediums, even though I agree with Kyle about the problems with display. The challenge is that most dealers aren't properly measuring the effectiveness of their digital marketing spend. Display or otherwise.

Like Kyle said, measuring impressions is worthless. Even CTR is a poor measurement. You should be measuring what those visitors did when they landed on your site. Did they view VDPs? Make a phone call? Did they convert on a lead form? View the map or directions page, etc? Measuring these types of macro and micro conversions and then assigning a value to them lets you distill a digital vendor or medium into a score that can be tracked over time. It also gives you a way to compare mediums such as display versus PPC, versus email, etc to see which gives you the best bang for your buck.

Now, let me add my experience in working with dealers and writing software to track the effectiveness of display and other mediums. I sampled a few of my dealers that are using display along with PPC and display was absolutely one of the poorest performer for last month. For the exact same budget, display generated 1/7'th of the website conversions that PPC did and 1/2 of the number of VDP views as PPC. Same story when you drill into how many contact us, maps, reviews, testimonial pages were viewed. Display just doesn't perform as well as many other mediums. It does drive traffic and conversions, but at the prices I've seen, it's just not cost effective. Maybe if you get it cheap enough it would make more sense.

That being said...there are even worst offenders out there. Some of the expensive classified sites perform even worse. And many dealers will argue that they are getting a brand lift from display. I'm not convinced of that, but as they say; your mileage may vary.
 

@Jonathan Bast - thank you.  And candidly, it depends on who you ask.  I've seen some companies touting "industry average" at .08%...others at .25%.  Here's an interesting resource.  As far as a "successful" display ad campaign, it depends on the goal and how qualified the traffic is.  For example, if you're designing a custom audience through Facebook and Instagram Dark Posts and then remarketing to them from the website across the Google ad network, then a more true measurement of success would be (for example) appointments booked as a direct result on the service side...or leads generated...or, by other metrics, time from this demo spent on site.

@Renold Liu - take another look.  I do in fact argue against impressions, but you'll note I also argue that the CPC model is flawed because of the obtrusiveness of so many ads that create false clicks.

@Mark Hoffman - you seem like a guy I'd drink with.  Spectacular contribution - spot on.

Very interesting article. This is why I tell dealers Display advertising is literally the Billboards of the digital space. A good agency should let you know that direct response on Display ads is not high, and to stick to it for branded campaigns only, if at all. 

To your point about spend the money where the eyeballs are, I would go one step further and say spend the money where your dealership will get the best ROI. Snapchat might be great for a Honda store, but might not be the right fit for a Buick dealership. Each marketer and dealer should evaluate the returns on their investments and if a certain marketplace or advertising medium is not stacking up, cut it, reallocate and reevaluate. 

Interesting article. Man of my dealership clients were talking about this today. Paar Media Group is an automotive agency although I have to disagree with the agency being the issue. The issue here is one company owning and capitilizing on all dealerships. Example, most automotive digital ads and display ads are ran by one company that owns Autotrader, Haystak, etc. They have multiple dealers in one region competing against each other for the same customers and one company placing those display and digital ads. WHAT DO YOU THINK IS GOING TO HAPPEN? 

I just had this conversation the other day with one of my clients. If were competing for the same customers in the same region and the same company is placing those ads someone is going to suffer. One month they may favor the one dealership and vise versa. 

This is not an advertising or marketing agency issue. We protect our clients and look out for the best interest of the dealership. Not only, we will not take two competing dealerships in the same market. 

The digital world is powerful and can be risky if not careful. Finding a reputable digital marketing agency is key. 

Great article Kyle, it has grabbed the attention of many. 

I am getting these same thoughts from GSM's all over. 

I agree with your assessment ( and love the data backing it up). 

Let us not forget that Dealers have / had the same problem with newspaper ads - people turned the page and ignored them. How many people really scanned all the new / used cars listed in the full pagers ? 

The first thing I pulled and threw away was the Auto ad section, followed by any other insert advertising ( which on Sundays was at least a pound of paper ). 

Now I have foregone newsprint but I read the 'digital replica'. Again I click right past the ads. 

You cannot make people read ads of any form if they do not want to. 

Mike