Is there a KPI Revolution in the Works?

KPI Revolution

*Editor’s Note – This is a contributed post from a guest author. Views and opinions may not necessarily be represented of our editors.

It’s funny, everyone’s key performance indicators (KPIs) are becoming outdated. I’m watching the world slowly change their values of what they thought were Key KPIs.

General Motors has decided that monthly reporting is a thing of the past. How can that be?  The auto industry centers on monthly reporting. Now they will be reporting quarterly, claiming that monthly reporting was ineffective.

The Mormon Church’s leadership has decided after 109 years to change the the “Home and Visiting teaching” program its 16 million members use as well.  These Programs were designed for Mormons to reach out to other members by home visits for fellowship and reporting them monthly.

They changed the program to ‘ministering’ and halted for now monthly KPI reporting of visits.  While the program is still new, the emphasis of just getting out there and living your religion by example is now more of the focus.  The century old KPIs of reporting visits are gone. Done away with.

So what do these two seemingly opposite examples have in common?  What can understanding change in KPIs for both a leading company and religion?

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The answer leads me to one of the heat maps I made for a dealer of all of his leads from every one of his legitimate website visitors.  He believes, like most dealers do, that they are getting a good amount of traffic.   He, like so many others, also believes the agencies they are using are giving them the best bang for their buck.

Many of them believe that writing blogs and posting content will get them attention and, therefore, local notoriety.

Sounds good, but 98% of his traffic was not even in his state, let alone in his market area.

So this prompted me to dig a little deeper.  I looked at my dealers’ websites visits and every visitor that I could find, we converted into real verified home addresses from my own clients.

Here is some of the information that I have discovered:

  1. Organic or not, most web traffic comes from outside their market area.  By most, I mean over 50%. There are thousands more that are counted but don’t have an identifiable addresses even though they are in the PMA of a dealership.  That means they’re likely bots.
  2. About 90-95% of the web traffic never arrives into the dealership for anything.  A lot of wasted traffic goes unnoticed or in some cases don’t get effectively targeted ads or email.
  3. A dealer may like to measure hits or visits to VDP’s. (Remember a lot of my client’s visits to VDP’s were from hundreds of miles away. ) I’m ok if the traffic is local. It’s a talent to get a potential customer to land on a VDP and stay for a few minutes. It’s even tougher to think you can bring them in, let alone from way outside your PMA.
  4. Great showroom traffic was sent packing.  Even traffic that I send into dealerships may or may not be counted as valuable.  Sometimes I get it right with marketing to website visitors by mail, and I’m able to send in dozens of customers into the dealership from a trickle of web traffic day in and day out, every day, 365 days a year.

However, is it a good KPI to measure the success of a sale against the traffic I create?

Turns out, it may not be after all.

Sometimes I visit the store that I market for. I ask the sales people on the front lines how they like the program that I created by pixelating their website.  Some love it, others that have have only started sales that month, or came from a different industry, may think otherwise.

They might believe that the website visitor I sent them was a waste of time even though they came from visiting their own website.  How’s his training going to affect my KPIs? This scares the hell out of me.

For any good marketer that knows what is going on in a store, it’s going to be tough to be responsible for direct sales as a KPI.  Too much can go wrong in that is out of control of the agency or a good marketer.

My strategy is pretty pure. I only market to website traffic that visits my client’s website. They get identified with a home address immediately from their device ID and IP addresses and send out a private offer USPS postcard the next day.

I’m in their mailbox 3 days later from a digital visit. Who can do that?   If the client had enough traffic, I could send him a Tundra offer from the Tundra VDP he looked at. Programmatic Omni channel marketing at it’s finest. Who wouldn’t want that traffic from their website into their showroom floor? 100% of you would say yes to that. But why then am I not world famous?

So I’m going to stick my neck out and offer a new type of KPI.

Like General Motors, or Mormons, I want to keep it simple:  I measure traffic from the cards that I send in for redemption. Ups, mooches, floor traffic, customers, call them what you want, I believe the best lead is from your website.

If you can’t close a website lead that walks into your showroom, then shame on you.  What could be better then getting the traffic that you spend thousands of dollars on marketing to get them to visit your website, and then into the dealership? Period, end of story.

I care that you succeed, but I don’t have control if you can’t close them.  You hired me to get web traffic into the dealership. That’s my job. That’s my KPI.  If you have a bad offer, or a bad store, or a bad location, those KPIs are going to fluctuate depending on areas that are out of both our control.  After working with or visiting more than 1,000 dealerships, I can save you money by sometimes saying “pass”.

My challenge is getting the people who decided to visit your website into your dealership or back online to fill out an application as easily as possible.

Up to 78% of all the traffic that comes into your store from your website is going to buy something somewhere.

I don’t know if you have the time of patience to do this, but your key performance indicators should reflect the results that come from real information from traffic. You won’t do this but if you did, it would change how you would advertise forever:

  • Offer Incentives for Exit Interviews – As customers leave your store to go home or after the sold delivery, offer them a $50 cash exit interview.  They can say no, but few people will turn down cash or a gift card just for giving their input.  Find out their impressions, how you met or fell short of their expectations and, most importantly, where they came from in the first place.
  • Ask Direct Questions – Show them a computer and have them get onto the search site or web site to show you how they found you.  Record every movement, phone call, or website that they visited. Share this and the cost of your research with your agency. You don’t have this information even though you think you do.
  • Get Specific Sources – Don’t ask if it was radio, TV or newspaper.  Ask which website, what channel or website the commercial was on or which campaign they recognize.

I believe KPIs need to be brought up to date and every store has different challenges.  I truly believe dealers waste a lot of money because they don’t know what the measure. Results seem to be a logical thing to gravitate to, but I think that measurement is outdated by who walks through the door and how they got there, step by step.

About the Author

This article was originally published on LinkedIn by William Sattree and published here with permission. William specializes in direct target marketing in automotive and has spoken at numerous dealer 20 groups, and associations, along with creating training material at Lexus for Grandmasters.


About the Author

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This article was contributed by a Guest Author. The views and opinions expressed in this article belong to the author and do not necessarily represent the views of our publication. For more information about contributing articles as a guest, please contact us. Thank you.

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