About a year and a half ago, we did an Automotive News webinar with Google and Yahoo on how search engines have revolutionized the auto shopping process. One of the key points of that presentation is that search and auto shopping is evolving at such a rapid process, and the way people shop for a car is dynamically changing between the time they purchase the last vehicle and their next one.

With that in mind, we went back and looked at that presentation and updated the facts and figures. Incidentally, it’s changed exponentially since we last made this presentation. Here’s how search is revolutionizing the auto industry:

Search Is Exploding Faster Than You Know It

Estimates put the 2011 monthly search volume at 143 BILLION searches per month. That’s up from a mere 2.7 billion in 2006 – an increase of over 5200% in just six short years. Combine that with JD Power’s report that the average age of a trade-in is 6.2 years, that means that the way a consumer is shopping for a vehicle today, is drastically different than the way they did the last time they purchased.

Search Marketing is Bigger Than You Think

Go to a trade show or a seminar and you’ll hear about a lot of different digital marketing outlets from social media to email, mobile phones and more. The simple fact of the matter is that 54% of all digital advertising dollars go to search marketing – close to $19 billion. After that, display advertising (banner ads) makes up the next 32%. Put those together and 86% of all digital marketing is either search marketing or online display. Major marketers are putting their money where customers are.

The Internet is Replacing Newspaper

In 2000, 52% of all dealer advertising dollars were devoted to newspaper – which made it the number one dealer advertising outlet. Today, more dealer advertising dollars go to the Internet than any other single medium (Internet 23.7% newspaper 22%, television 20.10%, radio 16%, direct mail 9.7% and other mediums 9%). If you look at the trends over the last ten years, almost all the mediums stay in line with the exception of newspaper. Newspaper lost about half of it’s share to the Internet.

Customers Select Dealerships Online – Not in Person

It’s a really scary concept to wrap your head around, but the simple fact of the matter is that most consumers select the dealership they’re going to do business with online and they do it with little or no interaction with the dealership. JD Power reports that in 2005 the average customer shopped 4.1 dealerships when purchasing a vehicle and today a customer visits just 1.3. That means, on average, a customer buys from the first dealership they walk into. What does this mean? They’re selecting the dealership they want to do business online. Furthermore, they’re doing it with little to no interaction with the dealership. In the past six years, Internet usage in the auto shopping process is up 16%, while lead submissions are up only 2%.

Google is Destroying the Organic Space

If you take a look at a SERP (search engine results page), you’ll see that the organic results are actually the minority of results. On a typical SERP, you’ll have 1-3 top search ads, several to the right or bottom, a map result and a Google Places listing. In many cases, there will be only a single organic result on a SERP. There’s good reason that Google would want to do this. Google generates 96% of its revenue through advertising – and Google is a business with a market capitalization of close to $200 billion – and the majority of it is generated through those little ads wrapped around search results.

Google is More Important to the Auto Space Than the Market at Large

It’s well known that Google is the dominant search engine in the space – comScore reports that Google garners a 65% share of the search market. However, independent research shows that in regard to traffic to dealership web sites, Google accounts for close to 77% – close to a 20% increase.

Search Marketing Crushes The Competition

While most advertising agencies don’t want to admit it – advertising is an incredibly wasteful effort. Let’s compare: The Superbowl, which is the highest rated program of the year, pulled a 34 rating last year (34% of the population viewed it). Let’s assume there will be 19 million units of inventory sold this year through franchised dealers (12 million new and 7 million used). If you multiple 19 million by 34% and then divide by 12 to get the number of people who will buy a car  a Superbowl commercial reaches – you get an astonishing number of 0.17%. If someone types ‘honda accord’ into a search engine – what’s the likely hood they want to buy a Honda Accord? Let’s say it’s just 50% – compare that to 0.17%. Result: search marketing is incredibly targeted.

All Those Great Features on Your Web Site? They’re Basically Useless.

You spent a lot of time selecting and working on your web site – guess what – it’s useless. People really just go to your site to find inventory. Take this statistic: only 24% of your web site traffic visits a page that’s not your inventory or specials.

So What Do You Do?

Increase your search marketing budget – big time. Our average customer spends $3,200 on search marketing, $21,000 on television or radio and $62,000 overall. If someone were to take $2,100 from their television or radio and move it to search marketing it would do the following: increase a medium that’s 50% targeted by 65%, decrease a medium that’s 0.17% targeted by 10% – and not change your advertising budget a single penny. Make sense?

Want to see the full presentation? It’s live on SlideShare. If you’d like someone from Moore & Scarry to make this presentation at your 20 group or other event, contact us.

Google Adwords lead form extension in action.

However, we’ve also heard that they aren’t currently testing it for the auto industry and that the Google Adwords automotive team was battling to get the beta test.

Honestly, I can’t imagine an industry that does more paid search and could use the lead form extension more.

We’ll let you know as soon as you see it.

Moore & Scarry Advertising is the first of the major automotive search engine marketers to achieve Google’s new Certified Partner status, ahead of respected industry leaders such as Dealer.com, ReachLocal, Cobalt, ADP, AutoOne Media, SearchOptics and more.

Recently, Google dismantled its long-standing certification program – the Google Advertising Professional program – in favor of a new program, the Adwords Certified Partner program. Google scrapped the old certification because it favored search marketing companies based on the quantity of their advertising more than the quality. Google’s latest certification process is more rigorous, requiring multiple tests and specific areas of specialization, rather than merely a single test required under the old standards.  Simply put, the new certification is based more on quality of advertising, rather than just sheer quantity of ads or spending levels.

Even more impressive, while Google requires that only a single staff member pass the testing requirements, Moore & Scarry has a team of employees that are now certified under the new standards and others focusing on specific areas of specialization.

“We know that the search engines are the first battleground in the marketplace.  We are dedicated to keeping our clients at the top of them. I’m proud of our staff who made us the industry’s first AdWords Certified Partner.  We monitor Google’s changes and updates carefully, on a daily basis.  We know when changes are coming and we make sure our staff stays up to speed on Google’s latest search marketing techniques.  We then work with our clients to ensure optimum placement, content and spending, based on each dealership’s specific needs. By staying on the cutting edge and developing some pretty advanced applications like our Haystack inventory application, we’ve been able to help our dealers absolutely dominate the search engines.  Some of our dealers have increased search traffic by 100% to 2,500%,” said Duncan Scarry, agency president.

The Certified Partner program requires significantly more knowledge of Google’s tools and processes.  The new program is designed to designate individuals and companies that can create the most effective search campaigns

“Considering the fact, that the certification is designed to allow the best to shine, it’s no wonder we qualified so quickly. But then again, we are still one of the largest search marketers in the automotive industry. Whether someone is looking for the best or the biggest, Moore & Scarry is a great company to consider for digital marketing,” finished Duncan Scarry.

For example, let’s say we target the keyword ‘honda vehicles.’ A user searches for ‘gullwing motorcycles’ and Google knows that honda makes gullwing and a motorcycle is a vehicle, so it displays our ad. Clearly, as an automotive advertiser, we missed our mark. In the past, this would require lots of negative keywords or a workaround.

Now with the Broad Match Modifier that Google is beta testing with Moore & Scarry, we can use a ‘+’ to tell Google to closely match broad search terms. For example, if we target ‘+honda +vehicles’ (the plus signs denote the new advanced feature), Google will only return results that closely match our search, such as honda cars, honda trucks, honda vehicles, etc.

“This advanced feature will allow [Moore & Scarry Advertising] to have a much higher degree of control in regard to our paid search. This will eliminate a lot of non-relevant clicks and traffic. In the examples we just gave, we’ll remove all the traffic for people looking for Honda motorcycles, scooters and lawnmovers by simply adding a plus sign. It’s a much better option and we’re glad Google’s testing it with us,” said Annemarie Wheeler, a search strategist at Moore & Scarry Advertising.

Moore & Scarry Advertising has pioneered single-keyword phrase matching as a work-around to Google’s ambiguous broad matching system. This new feature, in combination with Moore & Scarry’s arsenal of search tools, will help our clients draw more relevant traffic for a better overall ROI.

Analytics is web-speak for the tracking of web site visitor traffic patterns and lead conversions. The training program provided in depth training that will allow Moore & Scarry Advertising to get a better grasp on the true return on investment from their client’s digital advertising efforts.

“As we keep pushing more and more money towards Internet and digital advertising, we need to get a better understanding as to which advertising is actually converting into sales and which advertising is just useless clicks,” said Duncan Scarry.

Three Moore & Scarry Advertising team members underwent the advanced training in Miami this June.

“What the training allows us to do is track a lot more than just traffic. The training has allowed us to offer our clients the ability to track different segments of traffic, see which cars, right down to the stock number, are viewed the most, and much, much more,” added Derek Bess, Moore & Scarry Advertising’s senior content developer.

Moore & Scarry Advertising is now completing the process to become a Google Authorized Analytics Consultant, a process which requires training, testing and certification by Google.

“Really, all we’re doing is allowing our clients to track their web traffic with the same detail that they track their floor traffic. We’re just keeping our clients one step ahead of the competition,” finished Scarry.