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Tim Niziak

Tim Niziak Digital Marketing Manager

Exclusive Blog Posts

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3 Myths about SEM and Auto Dealers, Debunked

Search engine marketing is intense. Considered a necessity for nearly every business active online, it’s a key piece of any dealership’s online marketing toolset. As more and more of the customer buying journey moves online, your dealership needs to be as visible as possible online in order to reach motivated buyers. 

Running an optimized SEM campaign in the automotive industry is not easy. The market is saturated, and the keywords available are highly competitive (i.e. expensive). There are also heaps of ‘experts’ touting the latest, surefire way that’s ‘guaranteed’ to help you find more leads and win more sales. 

With so many conflicting ideas floating out in the internet-sphere about how to best optimize your SEM campaigns, cutting through all the chatter to get through to the true best practices can be a challenge. 

To help you maximize your SEM campaigns, and cut through the misinformation out there, here are 3 common myths about SEM for the auto industry, debunked for you.

Myth 1 - You can always trust Google’s first page bid estimate

Google is clearly the industry leader in SEM. In fact, over 3,500,000,000 searches per day are conducted via Google. With that massive percentage of market share, you cannot afford to not have SEM campaigns on Google. That said, Google’s model is not perfect. At the end of the day, they are still a business dedicated to achieving their own profitability goals.

One of Google’s most misunderstood tool is their keyword bid estimator tool. You’ll often see Google’s first page bid estimates to be upwards of $25. (The highest I’ve seen is $42! I won’t say what keyword it was, but suffice it to say, actual CPC costs came in much lower).

From a business POV, overestimating makes sense. Google clients feel good when their actual CPCs come in lower than anticipated, and they feel comfortable investing more in AdWords. From a revenue standpoint, estimating high CPCs also helps Google drive up CPC costs, since customers will set a higher maximum bid in order to try to stay as competitive as possible. As other dealers in your space also opt for higher maximum CPCs, that raises your vertical’s aggregate CPCs since you’re competing against each other.

It’s important to remember that Google’s keyword bid estimator tool provides just that – an estimate. Use it directionally, and you’ll be in good position to run your campaigns more efficiently.

Myth 2 - You should aim for the #1 position, always.

There are some undeniable benefits to paying for that #1 result with your SEM campaigns. You get more clicks, more visibility, and usually a higher click through rate. But, you’ll also spend significantly more to obtain that #1 result. Many times, in a space as crowded as the automotive world, you can find increased efficiency (think lower cost per lead) by going after the #2 or #3 position, instead of the #1. 

You’ll have to discuss strategy with your marketing partner to decide what will work best for your dealership, but you should experiment with different positions for your ads. You may find your acquisition costs go down exponentially with a (slightly) lower ad position, helping you increase your ROI without compromising the number of leads flowing into your database.

The true goal for your marketing campaigns should be a blend of generating as many incoming leads as possible, at the lowest cost per acquisition (CPA), so you can maximize your ROI.

Myth 3 - Forget about other search engines.

In the US and Canada, the ‘other’ search engine we’re talking about is Bing. Bing’s been playing catchup to Google since the inception of SEM and - despite many innovative advances - they’ve previously shown little ability to grab any significant market share from Google. However, that’s been shifting slightly in recent years. In fact, in 2017 Bing captured 24% of search queries in the US.

That represents nearly 1 out of every 4 possible customers for your dealership, and while Bing can’t generate the volume Google can, it shouldn’t be ignored. Bing leads typically come in at a significantly lower CPA, with higher conversion rates and better click through rates than Google. That means you can generate more leads for your pipeline, more efficiently.

Conclusion

When running your SEM campaigns, you need to be sure your marketing partners’ and your dealership goals are aligned. Efficiency and volume should not be mutually exclusive. At the end of the day, you’re interested in generating as many qualified leads into your dealership as possible. Taking just a few optimization steps with your SEM campaigns will go a long way to helping you increase the leads you have coming in, while and boosting your efficiency.

Kelly Kleinman

 I shoot for #1 as much as possible. I've seen much better results shooting for the top.  No question. If the company is budget conscious, no can do, but the payoff is definitely worth it. If your SEO rocks, you win more bids at lower costs so it all works out when you do it all right.

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