A new study conducted by PureCars and Facebook looks at the impact that social marketing tools have on dealers that heavily rely on digital retailing and have managed to reduce their advertising spend.
Both companies studied online and offline engagement and sales rates stemming from Facebook’s automotive inventory ads and retargeting campaigns for 16 auto dealers during the first quarter of the year. Their data indicates that dealers received higher website traffic and retargeting leads — and with lower advertising spend.
“A rising number of consumers today utilize digital retailing resources during the research, shop, and transact phases of buying a vehicle,” said Jeremy Anspach, CEO of PureCars. “At the same time, many automotive retailers have cut their advertising spending but are still looking for ways to connect, engage and convert automotive shoppers.”
Anspach said dealers are realizing there is “great power and cost efficiencies” in today’s social marketing that is even more robust than it was several years ago, adding that “today’s sophisticated attribution technology makes it more accurate to determine ROI.”
The study reveals that Facebook’s Automotive Inventory Ads resulted in a 23 per cent boost in vehicle sales, at a $136 cost per incremental sale, compared to the traditional product catalogs ads on Facebook. Test dealers also managed to reach 83 per cent of their retargeting audience, and 11 per cent of their prospecting audience. PureCars said these are significant numbers for the average dealer.
The study also revealed an increase in web traffic of 76.4 per cent, which suggests the campaign was responsible for driving a lot traffic to the dealer’s website, which in turn populated the retargeting audience.
“This helped fuel the Retargeting campaign, which subsequently was the engine behind attribution for clearer ROI identification back to the dealer’s advertising expenditure validation,” said PureCars in its news release.
The goal of the study for both PureCars and Facebook was to better understand how today’s digital advertising resources measure and attribute offline sales back to Facebook/Instagram, while also exploring the impact that advertising on those channels has for their dealer clients.
PureCars said the study’s observers launched a lift test in January to demonstrate the impact Facebook advertising has on a dealer’s business. Observers tracked both online actions (VDP views and leads) and offline actions (vehicle sales).
To learn more about the study, click here.
