No Surprise: Pied Piper PSI® Internet Lead Effectiveness Report

Yet another wake up call to OEMs and dealers was quietly released today, showing no improvement in regard to Internet lead responses. While there were a few that made steps and improved their overall performance (Porsche, BMW and Mini), the industry average dropped a point to 56 (21 of 36 brands dropped). The report sites lack of transparency to senior management on the handling and performance of online sales leads.

According to Fran O’Hagan, Pied Piper CEO, the Prospect Satisfaction Index® Report showed that 50% of leads were responded to within 30 minutes, while 1 out of 11 were not responded to at all. Matched with a still-under-ten-percent closing rate for all leads in the automotive industry and those who understand the impact this creates look at how the OEMs and dealers deploy lead management tactics. In short, the OEM-mandated programs are not assisting dealers to better performance; they lead to standardization, lack of true engagement with and sales to consumers considering vehicle purchases, aggregation of data manufacturers don’t find useful, increases to paid marketing campaigns (mostly via retargeting and display with very poor results) and more revenue for unqualified consulting companies.

Not to mention that, while the industry sold more units in 2015, most dealers in the country didn’t increase market share last year (most of our clients did, though). That stems mostly from the inability of dealers to close more leads and execute on more effective SEO and SEM strategies for their markets. However, most dealers hear their vendors scream “we did a great job got for you last month” every month. Bullshit.

OEMs must wake up and realize that many companies selling consulting, lead management and other online services to them and the dealer body have no interest in anything besides adding top line revenue to their balance sheets, showing misleading reports of how “effective” their conversion rates are as well as how websites “convert” as more vendors count SRPs, VDPs and basic requests as sales leads. Data manipulation by many vendors in the industry hurts dealers and decision-making around and for dealerships.

While more speakers at conferences yell about “this one template kills it” and companies produce studies and white papers created to sell more duplicated templates and follow up processes, lead response effectiveness will continue to drop. And more importantly, the three areas that are the only ones that matter: lead-to-contact, contact0-to-appointment and appointment-to-show rates. And don’t even get us started on outsourcing lead management completely as some vendors pitch and a few have built their entire businesses off of, unless you have a death wish.

So with record unit sales, more dealers spending in traditional marketing again, very few dealers investing in digital education and true sales coaching especially around Internet leads and the homogenization of dealerships, don’t be surprised by the next Pied Piper report showing a further decline in results.

 

Want to discover how your leads are being handled without bothersome mystery shops? Contact IM@CS and improve your results with our lead scoring!

 

Best Practices: Professional Insight, Powerful Results

 

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