The auto industry has seen substantial growth of digital ad spend in the last few years, and the growth isn’t predicted to slow down. The auto industry as a whole grew online ad spend by 77% since 2016 and is projected to reach almost $22B by 2022. And of the industry’s digital spend, 43% is in paid search—a total of $5.8B.*
The combination of spend per dealer and the large number of dealerships means that only the retail industry spends more on search ads than automotive. The reason for this spend is simple: digital ads drive more sales and cost less. According to DealerSocket, the average profit margin for sold vehicles that were advertised on digital channels exceeds that of sales driven by conventional media by over $800.
It’s clear that paid search is becoming more important than ever, so let’s take a quick look at five key components of a successful paid search campaign.
- Picking the right keywords — Determine the search terms shoppers enter that you want your ads to appear on. This is one of the most important aspects of running an effective campaign.
- Creating the ads and landing pages — You need a headline and body text, as well as a link to a page on your site where you want users to arrive when they click.
- Setting targeting — Whether you want to target a 10-mile radius around your dealership or a multi-state region, adding geotargeting helps you catch exactly the right shoppers.
- Setting bids and budgets — You need to decide exactly how much you’re willing to bid on each search, as well as a monthly spending target.
- Measuring results — You can use the Google Adwords interface or another dashboard to measure the performance of each ad over time.
To succeed in today’s increasingly digital world, dealers must let go of certain traditions and embrace what works. It doesn’t matter if you’re late–paid search is a tactic worth investing time and marketing budget in for all dealers.
*eMarketer, February 2019