Keyword-Bidding Strategies for Dealers and OEMs

When you bid on keywords for your paid search campaign, you generally think of yourself as bidding against your competition. You want to achieve a higher search results rank then your competitors, at a price that makes sense in terms of ROI. However, people in the auto industry sometimes express concern that dealers and OEMs are bidding against one another, thus driving up the price without reaping a corresponding competitive gain.

It can happen. But it shouldn’t happen, and it certainly doesn’t have to happen. Here’s why.

Focus on Your Part of the Funnel
Think of the entire sales process as a funnel. The funnel as a whole represents all the people who are thinking of buying, for example, a Saturn. The shape of the funnel—widest at the top and narrowing to a mere tip at the bottom—represents the winnowing-out process. At the top are people who aren’t ready to buy and are often still in information-gathering mode.. Towards the bottom of the funnel, there may be fewer people, but these people are much more likely to be ready-to-buy shoppers.

Here’s a quick example. If you’re a Saturn dealer, you’re making a mistake to bid on the keyword “Saturn.” For one thing, it’s going to be expensive. For another, it’s going to bring you little or no return. People who do a web search for “Saturn” are still at the top of the funnel: they’re just beginning to do research and probably aren’t even part of your geographical market. These people should wind up at the OEM’s website (and not at a dealership website). So think of “Saturn” as a “national” keyword.

But let’s say your dealership is located in Omaha. Keywords such as “Saturn Omaha lease specials” or “Omaha Saturn VUE 2007,” are two examples that have a greater likelihood of connecting you to qualified buyers. Anyone who searches for these terms is ready to talk—to you or to your competition. These are examples of local keywords that have little value for the OEM, but will help you connect with people from the bottom of the funnel.

Local targeting is another technique that helps bring buyers to your virtual showroom. The idea of local targeting is to serve up advertisements based on the computer user’s IP address (which works much like their telephone area code). This way a computer user in Jacksonville, Florida, for example, would see only paid search results that were relevant for that geographic area.

Cobalt Has Mastered the Distinction
Understanding the difference between national and local keywords is important if you’re heavily involved in keyword bidding, and it could be useful in your relationship with your OEM. But Cobalt doesn’t merely understand the distinction; we’ve developed technology that makes it automatic. Incorporated into the bid management system available to PowerSearch Complete customers, this technology ensures that, when dealers do bid on national keywords, they never bid more than what makes sense in terms of ROI. PowerSearch Complete customers also take advantage of automatic location look-up technology that properly configures their campaigns for local targeting. The result is solid performance that’s strategically targeted and helps deliver you qualified in-market buyers.