Automotive Alchemy
Welcome to 'Automotive Alchemy', a podcast that dwells in the cavernous depths of data, unearthing precious gems of wisdom to illuminate your path to digital marketing success. As alchemists, we understand that each nugget of information is a vital ingredient in our elixir of knowledge. So ready yourselves as we embark on an enlightening journey through the arcane world of data-driven automotive marketing.
Automotive Alchemy
Is Transparency The Key To Success In Automotive Digital Advertising?
Explore strategies for maximizing your ROI in automotive digital marketing with industry veteran Shean Kirin on the Automotive Alchemy Podcast. With over 30 years of experience, Shean brings valuable insights into how transparency can transform dealer-vendor relationships. He shares real-life examples of dealerships being taken advantage of by advertising agencies and emphasizes the critical importance of verifying every dollar spent. Understand how clear, open communication can help prevent financial losses while fostering innovation and trust within the industry.
In this episode, we discuss ethical practices that ensure dealers and vendors work together with transparency. Shean explains why it's crucial for dealers to fully grasp the services they receive, allowing them to contribute innovative ideas and critically assess how their advertising dollars are being utilized. We tackle the issues of fear mongering and deliberate confusion by some companies, advocating for clear, straightforward communication that builds long-term, trust-based relationships.
From balancing transparency with proprietary technology to the ethical considerations of referral fees, this episode covers a wide range of topics. Shean shares compelling stories about how transparent advertising practices can build consumer trust, drawing comparisons with industry leaders like Tesla. We also explore the upcoming "cars rule" that mandates transparency and the importance of ensuring advertised prices match the actual offerings. Gain actionable insights on how to use transparency to enhance your digital marketing strategies, creating mutually beneficial outcomes for both dealers and customers.
Welcome back to another episode of Automotive Alchemy. Well, of course, I'm joined by the premier dealer alchemist, sean Kieran. We were just talking about this before we hit record. Kieran has more than 30 years of experience right here in the automotive industry, not just on the retail side, but now also with dealer alchemists providing all kinds of amazing services to dealers. But also this podcast, which is a great learning resource, and it's the reason why we film these episodes. Today, we're going to jump into something that's really important, which is the transparency side of digital advertising, and I just I'm going to cut through all the small talk and get right to it here, and I'd love to know your thoughts here on what's the role of transparency in building trust with clients when it comes to digital marketing.
Shean Kirin:Well, I think we live in a world where agencies have been stealing advertising dollars from dealers for decades. When I used to run advertising for the dealership, one of the first tasks I had was reconciling advertising dollars and what I found was that our vendor had been shaving $1,500 to $5,000 a month off of my $30,000 spend, and they were just not spending it every month. And there was never a reconciliation. And I take over the position, I go to get involved and I found $65,000 that had never been spent, that they were just pulling right off the top. So what is that role?
Shean Kirin:Transparency is about verifying that what we are supposed to be paying, we are actually paying. And in there we live in a world where ROI matters more than ever before. It is tightening up. We've been used to these massive profits, we've been used to these really easy sales and, frankly, it's not easy anymore. As it isn't easy, our sales process has to get tight, our advertising ROI has to get tight, and the only way to measure it is to track it. And the only way to track it is to be able to transparently understand every penny, wouldn't you agree?
Shaun Raines:Yeah, absolutely Absolutely, and I bet from your perspective, especially now as a founder and a business owner of a business that's growing like crazy it's got to be very frustrating when you continually come across dealers who are being taken advantage of by this. Your story is a perfect example, but I'm guessing you see this on a regular basis, and probably something that also compelled you to do dealer alchemist and put it together in a way that you have founding principle.
Shean Kirin:Once we got started, I was so frustrated by trying to track down advertising spend and validate transparency that I finally said wow, we can do a better job on our own. I can build a company that does this right. It's not that hard to do things the right way and, quite frankly, it works better. You need every advertising dollar to maximize results anyways dollar to maximize results anyways.
Shaun Raines:Yep, totally agree. Well, so how do you see kind of businesses, dealerships, how do they incorporate honesty and openness into the way they communicate through marketing, like their strategies?
Shean Kirin:with clients. So I think it's pretty simple. Really, the best way to be transparent is to validate what you say. So if you're charging a 20% fee or a 25% fee, then the dealership should have access to the AdWords campaign or the analytics campaign, which is fully connected to the AdWords campaign, so that they can verify it. I'll just tell you what we do.
Shean Kirin:I had a dealer that called me out and said hey, sean, I'm not happy that you weren't giving me access to my AdWords campaigns, and so we looked at the way that AdWords was set up. We realized that they changed some of the setup procedures, so the way that we're connecting data in the backend was no longer obvious, and every single time we have a dealer sign an NDA so that they can't take what we do and share it with somebody else. What it does is it creates full transparency, because they can see and validate that every single penny we spend with Google is available there. Because I got to tell you you can hide money in display real easy. You got a third party running display for you or running performance max or running vehicle listing ads. There's a great chance they're pulling money right off the top and you don't even know it.
Shaun Raines:Yeah, that's I mean. And when dealers are asleep at the wheel on these types of details, it's tens of thousands, it's hundreds of thousands of dollars over time, on examples just like that, just not knowing what to look for and realizing that, if that absence of transparency exists, where they're combining multiple digital ad types within one provider's ad platform, and the example you're giving with Google, Well, think about it like this Sean, thousands of dollars.
Shean Kirin:I was just looking at a zone report for a manufacturer in an area and what I noticed was that that entire zone was down heavily at the month of July. Like it. It wasn't good, it was a bloodbath. And if I was to look at all of the money that was spent on display vehicle listing ads and social ads with various providers out there where there was zero accountability and zero transparency, they've got an ad that costs them 15 to 50 cents and they pay $2 to $3 for it. I'm sorry, but that markup is egregious. Taking 15 cents and pulling it into $2, $3, $4, $5, I don't know what that percentage markup is. I mean it's thousands. I mean let's see 15 cents, 2,000, 3,000. What is that 3,000 or 4,000 percent markup? Imagine if we charge that on a car. What would the public say?
Shaun Raines:Right, no kidding.
Shean Kirin:So if you wouldn't charge it to a customer and get away with it, why would you let your agency get away with charging it to you?
Shaun Raines:You have to validate every penny period. That's a great point. That segues a little bit into something I want to ask you to get your thoughts on why accountability actually is really important when you're maintaining transparency in digital marketing and that agency example is a really good one of, maybe, the absence of accountability. But why do you believe accountability is also an important component when you're trying to be transparent with your digital ads?
Shean Kirin:Well, I think these two things go hand in hand. Ultimately, what do we need to do to service a dealer? Well, that's the real question. We need to have experts employed that understand the medium and the application of that medium, and there has to be a real one-on-one communication with the dealer to understand their actual needs in the market right now. And so, as a dealer, nothing was more frustrating when I got the educated idiot on my account. I hated it, and I'm sure there's tons of dealers out there that hate it as well.
Shean Kirin:You don't want to train someone at their job. As a dealer, you're paying that company a lot of money. You're talking about $10,000, $20,000, $30,000, $40,000, $50,000 spent with a company, while, of course, the majority of that goes to actual advertising spend with Google, meta, et cetera. The reality of it is you deserve an expert there. Well, accountability and transparency go hand in hand Because, first, when you're transparent and you don't have all the junk fees hidden in there, you can't afford to screw it up. And second, when you have full transparency and accountability combined, you're able to collaborate on real solutions to the problems that happen in today's world. Right, it's not easier, it's harder, but, interestingly enough, the effective dealers are doing better right so how do we become more effective?
Shean Kirin:That's what it's all about.
Shaun Raines:Yeah, that's totally on point. I know that there's probably a lot of different opinions on what types of ethical practices businesses should be following to ensure transparency for dealers, but there's probably a handful and they could be at least in my mind. I'm thinking there are some of them that are specific to maybe just how you're going to be setting things up. You've touched on a little bit already visibility, so that the dealer can actually see what's going on.
Shaun Raines:Sometimes, I think, at least from my side, I think one of those ethical practices that agencies, businesses should be following to give dealers that transparency is also sometimes just maybe a little bit more of the hand-holding type of education, like, hey, we know you're not going to spend all your time in the back end of even analytics, as much as we'd like dealers to get really deep and strengthen their knowledge in those areas.
Shaun Raines:Do you feel like those are some of the things though that as an agency that I know, but you can dish on it a little bit more what you guys do, do you feel like that should be like an industry standard? If you're going to provide these services to dealers, part of your ethical practice should be making sure that they have at least a base level of understanding of what you're providing, so that transparency becomes meaningful. It's one thing to be able to see that no, it's all there for you. But if they don't have any understanding of it and I feel like that's one of those kind of ethical things like help them understand a little bit of that they may not go deep with it, but they'll at least have another point of knowledge that takes them to a place that they weren't before.
Shean Kirin:Well, I think a way to think about it is that as a ad tech company, we can't sell the car for the dealer. I sure do wish I could, because I miss that job sometimes. I think salespeople don't realize that the single best job in the car business happens to be selling cars. It's funny how they all complain about it and then once they move up the phone chain, they complain about that too. Selling cars is the most fun.
Shean Kirin:Well, if they're good at selling cars and our job is to spend advertising dollars and maximize ROI, that means it's our responsibility to inform and educate about the process that we use and how do we apply that spend across various mediums in order to maximize results. Because in reality, think about it like this Innovation comes from a dealer that has an idea, and if a company isn't at the forefront of giving an amount of education and an amount of information about how these things work together, then the dealer is ill-informed to be able to supply an idea and say, hey, what if we went about it this way? What if we went about it that way? I think your best marketing companies are searching for new ideas every single day, in the middle of every single phone call, and so, yes, there's an ethical responsibility to be transparent about what's really happening and to look at those real results, because that's how we look and find innovation out there at those real results, because that's how we look and find innovation out there.
Shaun Raines:Yep, I completely agree. What are your thoughts on how well businesses are just communicating, really just very clear, and how it is associated with transparency? And I guess and I know that sounds a bit vague examples would be and you and I we never name names, really on the podcast, unless we're naming the dealer alchemist name, of course. But there are companies and there have been companies, some that are still around, some that are not around anymore, but their communication is absolutely the opposite of clear. It's almost deliberately muddied communication. That makes it almost impossible but certainly hinders that transparency effect to your own dealers, but also dealers who are considering, like we want to know more about you guys as you're trying to implant in their minds that transparency is one of these cornerstone issues for you guys. What are your thoughts there on how you communicate in your messaging and that could be the way you guys talk with dealers when you're at meetings, whether it's OEMs or at trade shows, but also in the marketing messaging?
Shean Kirin:Well, someone told me once that everyone has an agenda, and so let's say you're reading something. The author has an agenda, that's why they wrote the article. The challenge becomes that when we look at that agenda, and that agenda is only to fearmonger based upon the latest buzzword, that's a clear sign that something is wrong. My favorite example is the use of AI in every single conversation that goes on nowadays, because I'll tell you how we apply AI. Ai builds code for us, because AI is spectacular at building a lot of code. Another thing that AI does is build out content. It builds out rough draft content. It manages inspections, to say, looking at all of these items, for example, we look at on a regular basis, on a daily basis. It's managed by AI. It takes a look at every campaign. It says is it performing, is it not performing? If it isn't performing, it starts to look at why. Where is it? Are there weather events? Are there territorial events like geographic events that are affecting it? Are there interesting things going on with sporting events, with other sort of third parties that would be interfering with the performance of those ads? Before it flags the search person to go look at it and say, hey, something is wrong here. A good example is you know you get a blizzard or it's 120 degrees outside. Guess what happens? People might not be looking as much, or they might get increased looking today and diminished looking tomorrow.
Shean Kirin:So when you think about clear communication, ultimately it is. Does the person talking to me have an agenda and what is their agenda? I'll give you my easiest example. We charge a flat fee for advertising. We don't mark a bad spend. So, in essence, for me to make money, I need to maintain clients for a long period of time, otherwise I lose money on them. That's the way that it works. But let's say I get a percentage of ad spend and I get 20 to 25% of that, or even 10% of it. No problem, 10% on $40,000 is $4,000. Why do you think they're always hitting you up for an advertising increase? We tell our team very specifically an increase should be the last thing you're looking for. You should be looking at other things you can do internally first, because advertising budgets are finite. Maybe a dealer wants to spend it, maybe they don't. You have to know every single individual dealer know their needs first.
Shaun Raines:Yeah, couldn't have said it better myself and that's one of those pain point issues that anybody that's been anywhere near digital advertising with not just our industry but certainly in ours trying to understand why are you asking for more money? Why do you want to do budget increases? And most of them are wise to that game now, but I know you and I would agree on that. If you ever have to go and ask for budget increases, there's a business case that you take to your dealer and say here's what you actually and this is the essence of this conversation in transparency here's what we have found is available in the market that there's not enough budget to get this right.
Shaun Raines:So here's the results we're getting for your budget If you increase this. Here's why, and the reason why we are taking these three minutes to tell you this, mr or Ms Dealer, is because we are committed to transparency. We want you to know we're not just trying to make a couple of extra bucks. The smaller percentage is always the management fee, right? So if that's the game of an agency to try to become more profitable that's the way you're going to win. You're going to be found out eventually anyway, but I know that that's the way you guys approach some. If you're ever going to have to say you need more budget to accomplish this, you give them the business case that shows that versus yes.
Shaun Raines:There are many agencies that have been out there unfortunately, some that are still out there that they just want usually to start by making the dealer think that, hey, you only need a thousand bucks or fifteen hundred bucks, you don't have to spend a lot. They're just trying to get you've said this many times on other episodes, on other topics just saying whatever you have to say to get the dealer to say yes, to say OK, we'll give you a shot. Way, and you're irresponsible and you're not transparent in what you're communicating. You're going to be one of those vendors that's coming back all the time to get more budget, because you can't actually take a dealer in Miami or Chicago or New York, la or any big mark top 25 DMA and get great results on those budgets. So it almost is the lack of transparency of agencies that do that. They show themselves to be inadequate and really bad partners to dealers from the beginning, when they're actually taking that approach.
Shean Kirin:Yeah, I feel like if you're going to go to a dealer and ask for a budget increase as a vendor, it usually looks something like this A, the dealership wants to sell 30, 40, 50, 100 more cars and they have the inventory that allows them to do it. That's the first one. Or next we notice when we look at Auction Insights that all of a sudden one of their competitors is spending a lot of money in their area and it's greatly diminished their advertising results. Because, it happens, you get into an area where you've got a person that's in third, fourth or fifth place in the zone. They decide they want to buy number one and because they want to buy number one, they dump $50,000, $60,000, $70,000 extra dollars into the market for advertising. Well, you have to combat that and if you don't, you're going to see diminished results.
Shean Kirin:I just spoke with a dealer today that spends money in this entire demographic and it is a massive demographic over every single other dealer in their area. I said, wow, what does that budget look like? He said it's $65,000 a month and I just I didn't even know what to say. I thought, wow, and do you think that works? He said, well, you know, I mean, I'm almost sales effective. I'm like well then, it doesn't sound to me like it's working Right, like if you're spending $1,000 a car, I'm sorry there's a problem, right.
Shean Kirin:Yes, I mean quite frankly, our most successful dealers are anywhere between $200 and $400 a car.
Shean Kirin:dealers are anywhere between $200 and $400 a car, but it's also because their process is so tight that they don't spill any business and they're also farming for other business through their automotive mastermind channels, their lease renewals, all of the other places where they can be a proactive way of getting business as opposed to a reactive.
Shean Kirin:Their internet lead closing ratios are 15 plus percent, not 3%. Right, if you're closing three to 4%, maybe five or 6% of your internet leads, you're probably going to spend $500 a car because your team isn't good enough at closing deals. And you can blame it on whomever you want. You can blame it on your sales staff, you can blame it on your leaders, you can blame it on whomever. But if there's a 4% or 5% internet lead closing ratio, someone's not getting properly trained on how to be involved enough in that deal to babysit it to completion. Whereas if I look at a dealership that takes extreme ownership, right, like some of the stores that we know down in the Southwest, that we work with some of the ones I know in the Northeast in that world, I've got a general sales manager or a sales manager in the middle of every single deal, in the middle of every single conversation. Of course they're closing 15% of their internet leads.
Shaun Raines:That's why they can spend $350 a car on advertising. Yeah, so it's so critically important too. I mean, if you're going to chase success, you better actually have great processes in place too. So transparency holds hands with a lot of those things too. When you have really transparent providers, it allows you to actually have great processes, but you still have to do that work yourself right. So that's well. I want to move into one that this one might be a little bit rough to discuss. Not that we can't cover it, I know we can but why do you think it's important? Or do you think it's important to disclose partnerships and sponsorships of vendors in your marketing?
Shean Kirin:So I'll tell you a quick story. Once upon a time, when we first started the company, the standard business model in our industry was to go take on referral partners and to take on referral fees, as you referred in that business. And so we did it the same way everybody else did. We were a top reseller of another company's technology and someone asked us and they said, hey, what are you getting paid? And I got red in the face, told them the truth and then I got fired right afterwards and I think that they did the right thing. Looking back on it, we changed our model, we adjusted everything we did.
Shean Kirin:We do not take a single referral fee from any sponsorship or partner and when we do pay them, we pay them the things that make sense. For example, if I'm working in an environment where I'm supporting a local association, for example, we give 10% of that money back to the association to fight for legislation for that dealer. That's a proper use of referral funds. But instead most small, not most many, I want to not say most, because a lot of these guys are great guys that don't take fees but a lot of these small providers or small quote unquote consultants make their money by knowing that they've got a preferred relationship and installing that preferred relationship all over the place. I think it's on every dealer to say to every single vendor are you receiving any kickbacks on this referral?
Shean Kirin:And I would ask if they are receiving kickbacks, do you think they have your best interest in mind? What happens if there's a better provider out there that provides a better result? Is it in their best interest to refer that to you? And if you're paying them, should they be being paid by somebody else? If you're not paying them anything, of course they should get paid by somebody else, because no one deserves to work for free. But if you're paying them, I would argue that they shouldn't get paid by anybody else. That's the scope of your arrangement. When you pay them, is you're paying them to not accept referral fees from other vendors.
Shaun Raines:Yeah, I so it's. So I mean, I love hearing you say that I have, I'll take the liberty. I have, I'll take the liberty. We're having a conversation.
Shaun Raines:Just Monday I had to drive over to Dallas to participate at an event where I was talking about branding like building brands for companies and individuals and I had about a 40-minute talk and when I was done with my presentation, the first person to ask a question an independent dealer, pretty new, actually, just trying to get their stuff together, and so he surprised me because I didn't really think anybody in the room really wanted to hear anything about branding. I thought they wanted just the immediate how do I get more leads to sell more cars which there's always plenty of that. But this guy disclosed to me that we're actually very new. He told me about, and I asked him like well, how many cars are you going to keep normally as you get your operation going? And so all these interesting questions about brand. But he, in the process of that, is disclosing that he and his business partners there's a couple of them that know a little something about what they're doing and a couple of them that have no idea what they're doing and so this all ties together. At the end of the day, which wasn't particularly late for me I made a point to write down on a piece of paper out of my notebook because I'm old school still. I wrote down a handful of um of vendors that I thought as a used car store, as an independent store, and they had no idea of some of the common people out there. You would think, well, if you're going to be doing used cars, you, there's a few things, people that you probably want to talk to. And so I wrote down some of these recommendations. I wrote my name and I wrote my email address, because I don't really give out business cards anymore. I wasn't looking for business from this event. I just told this guy this is who I am.
Shaun Raines:Building a circle of trust in any industry is really important. People that will give you good advice and if anyone breaks that trust, just run away from them and start with other people. But everybody I put on this list I do not receive kickbacks from. I have no referral fees. I told them all these things. So your answer right now. I just love hearing it because I've always tried to do that myself.
Shaun Raines:When I'm making recommendations to people, I want them to know that the skin in the game for me is I want them to be successful. I believe that what I'm making recommendations to people I want them to know that the skin in the game for me is I want them to be successful. I believe that what I'm recommending to you, that these are good people to talk to, like if I were you, if I were the operator, if I were the dealer, these are businesses that I would reach out to and I would have real conversations with because I believe they would be valuable to making me successful. And I told this guy that, as I handed him this piece of paper and the look on his face was almost like I walked off of a spaceship and I'm not even speaking English, like I'm an alien, not in a bad way just like he was so mesmerized and refreshed to hear that people still think that way and it just made me think gosh man. How bad must it be, then that there's still so many people that don't just say that?
Shaun Raines:And I don't know, do you feel like most people nowadays have the expectation? In my example, here's five companies that if I were you, I'd go look at their websites. Talk to somebody. If you need a connection. I'm happy to introduce you to people. I know people that work at all of them and, by the way, I get nothing. I have no referral relationship to them. Do you think people are surprised by that? Because what mostly happens is here's a list of people to look for and they assume that there's something in it for you. Like you said, everyone has an agenda.
Shean Kirin:You think that's what people's default thought process is in that? I don't think so. I think that as a dealer, we are so busy selling that we become an easy sale and so what happens is that someone's got a ton of charisma, they've got spectacular people skills and we buy the people skills instead of really deeply inspecting the product and the conversion and the actual analytics of the product.
Shean Kirin:And most of the dealers that I know they kind of fit into that grouping right. The better of a salesperson they are, the more we like to be sold. That's the bottom line. So unfortunately, the side effect of that is that the great sales pitch maybe it does have those fees included, maybe it doesn't. So I think it has to be on the dealer to ask that question up front every time and say are you getting a kickback on this? What is your profit model? How do you do this and stay in business? Because everyone should know, like for us, as an example, we have a flat fee scenario. The upside of that flat fee scenario is that I know what my net is on every single deal period. The upside of that is that I don't have to spend more to make more because I don't get paid on ad spend. So whether they spend more, spend less, it doesn't negatively impact my profit model.
Shean Kirin:You're going to find a cheaper vendor out there with no service. So let's say that I sell 75, 85 cars a month and I'm not spending a bunch of money on my digital advertising. I'm not real happy with my results, but I'm trying to nickel and dime that provider down to getting the $500 fee. Well, guess what? You're going to get $500 worth of service. Do you really think you matter to that vendor if you're paying them $500 in profit? I promise you that you don't.
Shean Kirin:Instead, it takes a couple thousand dollars in reality to run a platform for a dealer as a general rule of thumb. And so when you look at combining a little bit of fee structure, it's going to be $2,000 to $5,000, depending on which products are involved for a vendor to truly have a software model combined with a data model and pay all of the associated fees that are matched up with that, pay all of the associated fees that are matched up with that. And if a company does that, then what it does for the dealer is it means that the dealer gets real service that entire time, and I think in a world where things are getting more difficult, you have to have real service. If your vendor for advertising isn't meeting with you a couple of times per month to look at your results and dive deep, I'm sorry but you're not getting enough service. You're you're on the wish program, you're on the I hope it works program I don't know about you, but I don't like the hope it works program.
Shean Kirin:I want verified and validated results. That's what I want it's.
Shaun Raines:Uh, it's relevant because the this particular movie right now is just blown the box office to shreds. But the new Deadpool movie, which I finally did see to your point where they're just it's. You're on the wish plan. Um, there's a line in there where you made an educated wish.
Shean Kirin:I've never heard of that before and that movie is awesome. Oh my goodness, yeah, I like. It's been a little while since I laughed so hard.
Shaun Raines:I cried inside of a movie theater yeah, I um, you know, as a, as a sidebar, I I chopped up some things from deadpool for this presentation that I did on monday and I've done that a lot, but with Deadpool specifically because it's fun to have him pop up and break the fourth wall of a PowerPoint and talk to the audience directly, which I did a little bit of, including the hey, did Sean happen to ask Disney or Marvel for permission to use any pictures of Deadpool? And the very next slide is Deadpool sliding up with a yellow talk bubble that says abso-fucking-lutely, not yeah, just having fun with it. But Educated Wish it's kind of funny. I immediately thought of the Educated Wish that he made on behalf of Wolverine. That's kind of the.
Shaun Raines:If you're a dealer and that's the plan that you kind of got signed up for, it's time to change course.
Shaun Raines:I do want to ask you now a little bit about and just in general, we've never I don't think we've talked about this on an episode before but there are vendors today.
Shaun Raines:There have been vendors over the years, especially in the evolution of all things digital marketing, digital advertising providers that will come out and say hey, we have some proprietary technology, we have proprietary information, we have a proprietary tech platform, blah, blah, blah, and I'm not making fun of that, because there is some truth in some of those things where it's like, hey, there are some of the things that we do in our system that makes us unique, that that's the primary value that we deliver to our customers, and so I'm just, I guess, wanting to pick your brain a little bit on when there needs to be a balance of transparency, but also a business that has some things like well, there's some of that that we need to protect.
Shaun Raines:And top of my mind is I'm not going to say any names but there are companies that talk about their proprietary technology and they use that as an example really to not be very transparent, like they'll go and take screenshots out of things that aren't even their technology, like Google Analytics or AdWords or a combination of both, and put those into a PowerPoint that they turn into a PDF and then they send that out as a report to their dealers. And then they send that out as a report to their dealers and they will hide behind. Well, we have proprietary technology, so we can't give you access to these things, including properties that those companies don't own, and I feel like that is deliberately confusing a dealer by not being transparent, but trying to say that you are. It's like gaslighting people. Maybe that's the wrong term for it, but it's like hey, we're really transparent, but the evidence of their transparency is.
Shaun Raines:It proves that, like no, you're trying to hide from real transparency. So I'm just wondering if you have any thoughts on that, wondering if you have any thoughts on that?
Shean Kirin:Yeah, so this is probably one of my favorite topics and it's something we spend more time on than most other things. And it's because, as a technology company that owns a pretty significant amount of proprietary technology and processes for how we do things, we regularly see that when I deploy something, it performs better period. As a matter of fact, I expect a 10% increase in a dealer's overall ranking when I look at their final results at the end of the month, because we expect it. We're just good at our job. Well, for me, as a company that has something to protect, we still have 100% transparency in every invoice. Right? There's a process and it should look like this If you invoice a dealer upfront, which is what most companies will do then at the end of the month, you reconcile to the penny period at the end of every single month, and if you're not doing that, it's not good enough. In addition to that, when it comes to that proprietary technology and transparency, there is zero liability and not a single thing that the dealership can screw up or get access to. That's going to cause a problem.
Shean Kirin:If the vendor properly connects the AdWords account to the analytics account, you simply can't break it, they can't copy it. There's nothing they can do. It is the absolute minimum required amount of transparency period I would say. Next to that is any vendor should always log a client into the AdWords account to show them the exact costs inside of Google because Google is the number one place where it's hidden and also inside of Facebook. It takes a few seconds and from the screen that shows the costs inside of Facebook, you can't see a single set, and so if, as a dealer, you're getting a PDF of those instead, my question is super simple Do you have somebody on your staff that got fired for knowing their fonts?
Shean Kirin:You probably do, and you probably fired them for changing things they weren't supposed to change. Most dealers have dealt with this problem inside of a finance office over the last 15 to 20 years. A lot of those people became vendors. Do you really think they're not capable of manipulating a PDF to make it look like something that it's not? Of course they are. You have to validate at the source on a screen share at minimum. It's just the requirement, and if not, don't worry, you're okay with somebody stealing from you. That's what you're really saying. You're saying I don't mind, I'm just going to bend over right here. I'm going to go pick up these couple of dollars right here. You do whatever you want back there.
Shaun Raines:I mean, it's such a better experience in building true, lasting relationships between businesses and their customers. When you do it the ideal way. You're talking about Spending time, especially if you are using whatever Google Meet or Zoom you're getting face-to-face, even if it's remote. We have great technology for that. Now it's really important, I think, for people to demand the things that you're talking about. I think that it should be like a prerequisite to all the relationships you have with service providers. Is that they're going to do that, because you do have all these wonderful opportunities to help elevate the knowledge of. I mean, I don't want to demean the customers or dealers to say, hey, we're always teaching, but there is a responsibility, I believe, from the service providers to be educating in those opportunities as well. So the transparency comes through.
Shaun Raines:Yes, there is certainly the proprietary components of why you're being chosen in the first place because you can accomplish great things. You can do great things on behalf of the client. But when you sit down to talk about results and being transparent, those are also the same opportunities to strengthen those relationships by sharing information that educates and elevates the knowledge of the client. And every experience for me personally, when I've seen the opportunities to help someone gain a level of knowledge that they didn't previously have. It always enriches a relationship with more trust, which I think is the foundation of really that relationship, and of the brand anyway, is trust. So imagine putting all those things together in a way that almost keep you from wanting to do that.
Shaun Raines:It seems like, well, you're going to set your company up for this perpetual mouse wheel of activity that missed one of the biggest components that you should have been doing, which is, yeah, use transparency to show them what you're doing, but also educate them along the way.
Shaun Raines:And all of a sudden, now you have these relationships where people, I think, develop loyalty because they feel like not only are you providing great results for them, they're getting smarter about their own business and why they're making decisions to work with you and others, and I just love all of that. I think it's really important in terms of how we communicate. So I think that was a very interesting answer. I like that. I'm curious in how this affects customers. I was going to ask you for maybe examples of messaging across channels is an important point of transparency when you talk about digital advertising, and so I'm sure you could how you believe that that importance affects the customers of making sure that they see transparency when it comes to how a business is actually communicating, because essentially, advertising is really introducing yourself, introducing your product, introducing your business, to see if you have any thoughts on that.
Shean Kirin:So I met with a dealer this week and the dealer was dead set on these lace payments and throwing them out in all of their ads. And there was a problem. The problem was that this vehicle didn't exist, and so by the time you built that payment, you couldn't find a single car with that payment in the entire inventory. So imagine you're a consumer that sees this ad for the $299 SUV whatever, right, that thing is a unicorn and it doesn't exist and you go to the website and the first one you see is a $600 payment. Are you going to do business with that dealership? The answer is no, you're not Right.
Shean Kirin:So when we look at communication across different mediums, there are just rules that you have to follow. If your website displays a payment, that payment can be in your advertising. However, if you've got an advertisement for a low payment and you're clicking them on a vehicle that doesn't display that payment, you look like a liar. So we have to be careful. Right, whether we like it or not, our competition is Tesla. Maybe you believe it, maybe you don't, but look at the way they advertise Me.
Shean Kirin:Personally, I'm not a fan. I don't like that. They're anti-car business. I could be on a soapbox for hours talking about how they devalue communities, devalue our business, even though $399. And so my challenge to all dealers is this you can advertise across all mediums, whether it's a price point, whether it's a payment, no matter what it is, as long as it's real. Real doesn't mean I landed them on a specials page with no vehicles attached that fit that description and they've got to fill out a form for a vehicle that doesn't exist. That isn't going to sell you a car.
Shean Kirin:A better spend is to put the inventory in front of the person that is most likely to buy it right now on every device in their household, at whatever price or payment your technology can put in place. As an example, we are building in full penny perfect payments onto every vehicle, native into the website platform that we own, and in that setup you can see a perfect payment all the time. It's not like a quote, unquote 10% down, 6.9% rate, blah, blah, blah. It is what is the best available payment and how did I get there, and you can duplicate that inside of all advertising so that the vehicle is real. See in our world.
Shean Kirin:Transparency has to mean that what they saw in the ad they see inside of the website, and it isn't just because it's the best practice, it's because it's what sells more cars. Advertising creates one of the website, and it isn't just because it's the best practice, it's because it's what sells more cars. Advertising creates one of three things it creates a phone call, it creates an internet lead or it creates a lot up. When all the dust settles, you can account it to a total of those three things. The best dealers track all three as a total number and that's the metric that they're looking at, because true digital advertising drives all three things, not just leads and not just phone calls. If you wanted to increase that number, you would increase it by ensuring that whatever advertising message you put out there is reflected for real on every vehicle that matches it on your website.
Shaun Raines:That is how you get that done great stuff, really really good stuff, and you you kind of ventured into a couple of other questions I was gonna, but you did a really good job and I just um want to help shape this for the audience a little bit. Um, what you were just sharing also kind of really touches on the accessibility of information to consumers and how that builds trust with them and payments right and how that all stitches together. And the Tesla example, which I don't really disagree with your thoughts there. I think that there are definitely some we don't really know and I don't think they really care about the traditional car business. And, yeah, some of the things that they brought to the business have been difficult for a lot of people and you could call them disruptive, but many of them kind of helpful too, of like we should be doing things like this and from a transparency and a trust factor, long before we've been talking about the quality of the vehicles how are they built to last? Are they going to, in the long run, have Toyota's reputation for longevity and value and all that? I guess we'll end up seeing over time. But they have done a good job of building trust with consumers by putting lots of information out there and the pricing information is really, really important.
Shaun Raines:And the other thing that this is relative to that I was going to ask about that you just discussed was there's a disclosure. You're being proactive in disclosing really important information that people appreciate that being transparent. It's almost been one of the, if not the primary, achilles heel of our industry is the lack of transparency when it comes to things that needed to be disclosed to the consumer right up front a long time ago and making all the information accessible. But our industry has actually been one that, even not just up until the internet, but even now with the internet and social media and all the things that force transparency on dealers, there are still ones that wish that they didn't have to deal with that, because the beginning of our industry was really holding back all of that information not disclosing. They even come from that era, but they realize, but everybody can see everything now.
Shaun Raines:So we need to be in this full disclosure and then be really good at deciding well, what are some of the things that not necessarily that you don't want to show to people, but prioritizing in terms of what order some of those things are discussed or presented to the customer, and I think you mentioned it already in this episode that you guys have dealers that work these meticulous processes within their stores, and I think that's essentially what really successful dealers do is they realize you can't hide all of those things anymore. So you have to put this transparency into play where all of these things do get disclosed, but they do also have to be done in an orderly fashion, so the consumer has everything they need to complete this buyer journey and then they've started a relationship with your store because you've done all these things. That basically were the escalation of trust. So, anyway, that was all really good stuff and it kind of answered a couple of things I was going to get into. So I want to.
Shaun Raines:It's not a big pivot, but I want to pay attention to when they're getting feedback. But I'll let you decide which side or maybe both sides you want to talk about, but certainly there's the review side, when people say something good or bad about your store, or they provide feedback through your CSI scores, or they provide feedback right to your face. Any of those scenarios. Pick any or all of them, but I'd love to know your thoughts there on where you feel like that's an important point for dealers and maybe how they should be going about it.
Shean Kirin:I think a good way to answer that is to tell the story of a friend of mine in finance. I have a friend of mine in finance that makes about $2,500 a copy, and when he makes $2,500 a copy in order to validate that they bought every single product that he sells them, he makes them initial next to every single line item on the buyer's order so that there is zero question about the products that they bought. And they buy $5,000, $6,000 worth of product on a very regular basis. So not only is he the best, but, interestingly enough, he's got the best customer transparency. He's got the best CSI. People love dealing with him because he understands how to build value in a transparent way and consumers respect that. He probably sells more engineers and accountants than anyone I've ever seen in my entire life, sells more engineers and accountants than anyone I've ever seen in my entire life. Well, that's the world that we live in nowadays, and so when consumers give us feedback that we lack transparency, most of the time it's lack of qualified sales process that caused that problem. So let's look at it from an advertising perspective.
Shean Kirin:My wife and I are buying a new vehicle, you know. So she just ordered a Porsche Macan electric and in that car that she ordered, we were able to do all the lease payments, figure everything out online, do all the work before we pulled the trigger, figure out what we needed to put down in order to get to the payment that she wanted to be at, and she, like a lot of people, is going to put down whatever she needs to put down to get to the payment, because people are payment buyers. Interestingly enough, when I look at the place where I live, there's a lot of people that way. They don't want more than a $300, $400 payment, but they put down $10,000 or $20,000 to get there. These people exist if you actually ask them for it and if you show that. It's just a simple math equation when there's trust, there is transparency, and when there's transparency, there's trust. And so what you have to do is you have to respond to feedback and you have to grow with that feedback.
Shean Kirin:So I think that most dealers in today's world are more transparent than they've ever been, and I think that most consumers appreciate that, and I believe that we're moving to more and more of that as time goes on, and especially when this cars rule comes into place, because the second the cars rule comes out and hits the market, which I think is July of next year it ends the ability to not be transparent, and so if I was a dealer that wasn't very transparent now, I'd probably stay the course for the rest of the year. In all fairness right, because as a desk manager in a dealership, I was a high grossing desk manager. I was really good at understanding what to put where in order to properly disclose the right way to maximize my profit, as so many good managers are. But over time next year, there has to be a move towards that. We have to listen to those responses and make those adjustments, and my recommendation is to make them slow.
Shean Kirin:So if you're going to move to a world of more transparency and you rip the bandaid off and you immediately do it overnight, you're going to cave in your dealership. That's what you're going to do. Probably the responsible way to do that instead is to build a roadmap out and say these are the steps that we're going to take to move in that direction, so that you don't alienate all of your best salespeople and all of your best managers in the process. But interestingly enough, when we do that, we actually make more money, not less. That's the important thing to remember.
Shaun Raines:Yeah, I mean, those are some really, really good tips and I think that's good advice and it's a little bit of a warning. But it's also giddy up and get prepared for when that drops. It'll come faster, even sometimes when something's a year away, it's going to be here faster than you realize. Working your way towards it is prudent, definitely for dealers. I've just got a couple more things I want to pick your brain about and then I'm going to let you get back to dominating the world.
Shaun Raines:I'm curious to know your thoughts on pricing. Pricing is transparent and you mentioned that, you know, which I think is great. I hope the audience is keying in on what you guys are doing and building up the website platform that you guys own, but building in transparent pricing in there, I think, is huge and it made me think okay, pricing is actually another big area in terms of just making sure the transparent pricing is included in marketing efforts. But that's not just what consumers will find at a dealer's website. That's obviously in a lot of other places. You would actually use an example of kind of lease payment. But I'm curious to know if you've got some other thoughts on how dealers can make sure that they have the transparency effect with how they go to market in all of their ads around the pricing issue.
Shean Kirin:I'll give you a couple of examples that tend to work best and I'll tell you that every market is unique and you really do have to know what's happening inside of your market. An excellent example is I was looking at a dealer in the Chicago land market the other day and you want to talk about a place where it is an aggressive race to the bottom on every single price. I mean, wow, it was difficult. And so in that world their pricing is like there was a dealer that was violating map pricing and no one could do anything about it. So these things happen. But I'll tell you what if you're a dealer, you've got a couple ways you can look at that. One way is you price your vehicles at. Msrp can look at that. One way is you price your vehicles at MSRP you have to have an unlock your price button and when they fill out that form, automatically it displays a lower price. That's one way to get it done. Another way is to put them at MSRP. If that is what works in your world and in that world, make sure that there is some sort of internet button to get a better price. Make sure that there is some sort of internet button to get a better price. That works in some brands. Other brands it is. You've got to be competitive in the market within $1,000 of your closest competitor Really within $500, it tends to be the best practice. And in that sort of setup, once a week, once every three or four days, you're pricing out different model lines to make sure that all of those are competitive.
Shean Kirin:And if you happen to be the one that prices 10 or 20% of your inventory competitive and you leave the rest at MSRP, you're going to find your advertising stops working because inevitably the consumer is going to find the one that doesn't have a discount and because they don't have a discount, they're going to go buy that same car someplace else that has a discount. That's what they really do. So the rule really is keep your pricing competitive right. It doesn't have to be the lowest. As a matter of fact, I would argue that it shouldn't be the lowest.
Shean Kirin:I would argue that competitive is really where you ought to be. And then from there, if you quote an internet price and you say that unlock your best price, get your best price, any sort of button that makes the distinction that you're going to offer something lower, we'll make sure that the quote that you sent out has a lower price, because if not, they're simply not going to respond and the results of that button and the website and the price all have a flow that makes sense to the consumer so that they can follow that path and they can see that it's transparent. And every time I look at the biggest dealers out there that sell a thousand plus cars a month, guess what they're good at Transparency.
Shaun Raines:Yeah, that's great advice. I got one last question for you and I'll just say this tag your closing thoughts onto this as well, but we I probably could have started with this question, but just want to get your closing thoughts on. You know what the challenges are of being transparent in this digital marketing world, because there are certainly a handful of things that you have to navigate carefully, and it's not so much in the interest of not wanting to be transparent, but there are definitely some challenges in wanting to be that kind of full disclosure. But sometimes that also means that if you didn't have the discernment of what you're disclosing and when you're disclosing it, that you might confuse the customer or you might give them too much too soon, or there's a lot of those things that go through my mind relative to that question. But I'd just love to know your thoughts and what do you see as some of the challenges that might be helpful advice to dealers and then any closing thoughts on the episode on the episode.
Shean Kirin:When I think about the challenges of being transparent in digital marketing for a dealer, I think they tend to revolve around the same couple of things. It usually is what is my advertised price and what did the consumer get in response to an internet lead, a phone call or being in person, and those things have to line up every single time. Call or being in person, and those things have to line up every single time. So I think, to begin there, the dealer has to make a decision. What type of dealer are we? Are we a profit-first dealer or a volume-first dealer? Am I a take them high, take them low, take them all type of dealer? Whichever one of those three they might be, the reality of it is that's going to set the stage for all advertising effort that comes out afterwards. Where are you located in the Northeast? You're going to put a lease payment in your advertising. You're going to drive it to a page that has that lease payment sitting on a car, because when you do that, you succeed. That's the bottom line in the Northeast. That's the bottom line in the Northeast. Interestingly enough, when I'm looking in the Southwest, it's oftentimes about just pricing on cars. Pricing and discounts seems to work really, really well, and so I think that the biggest challenge is you have to know your area, you have to know your brand, you have to know your competitors and you have to figure out where you fit inside of there. You have to have your identity. What is our way of conducting business? And then, once you do that, you don't have to apologize for it, because it just is Right. I'm in Denver and we have a huge one price dealer here in Denver and, interestingly enough that one price dealer is not always the lowest price. As a matter of fact, they're just usually not. However, they are a big volume stores with almost every brand that they service. I would argue that the reason they are that is because they're very clear with their identity and they pursue and move forward with that identity 100% of the time.
Shean Kirin:Right, so have a plan, don't apologize for the plan. Just follow the plan and everything is going to work out every single time. That's really the key of being transparent is that you can't say one thing and do another. That's what doesn't work. Have a plan and execute that plan and really be unapologetic about that plan. Validate why that plan is best for the consumer.
Shean Kirin:I'll give you an exact example. I wouldn't want to work with a low-priced vendor, because if I work with a low-priced vendor, I'm going to get low-priced service. And if I get low-priced service in my advertising whose sole purpose is to give me ROI inside of my sales department, how is a low price provider that doesn't give me the service going to maximize my ROI? I don't think those two things work in the same sentence. Right, just as a dealer works well, right, you've got a consumer that pays you a good profit, not an exorbitant profit, but a fair profit. Congratulations. Customer service is high, your salespeople do a great job, the follow-up is spectacular, you get great reviews. That's the win-win scenario. So maybe the biggest challenge there is figure out how to create the win-win scenario and then, once you've got the plan, follow that plan.
Shaun Raines:You kind of finished the episode by helping the dealer understand that their brand, like who they are and why they matter, that all of those things are really core to helping them communicate in this transparent, dependent world that a lot of businesses, a lot of dealers look past, and it is very much tied to things like transparency and accountability. So, another banger of an episode, fantastic. I want to thank the audience, of course, kieran, thank you for showing up and dropping all kinds of knowledge bombs, all kinds of knowledge bombs. But to the audience, whether you're a watcher or a listener or both, thanks for joining us for another episode of Automotive Alchemy. If you want to go deeper, I will say this, but take advantage of a couple of things.
Shaun Raines:One, the complimentary digital marketing audits that you can get from Dealer Alchemist. Just go to www yeah, you got to hit that Dealer Alchemist. Just go to www. Yeah, you got to hit that dealeralchemistcom website and you can easily get in touch and there's no charge for such audit. It'll just give you an idea of kind of where you're at. But there's also some great resources on the site there that you can peruse, including some eBooks that will help you with understanding SEO better. There's a great eBook there on SEO. There's a great eBook on digital marketing tips, and there's also the one that's the entire road to better marketing that came out at NADA this year. So don't miss out on those opportunities. Getting smarter in your dealership should always be important and prioritized. That's why we make this content. So we appreciate you tuning in. Don't miss the next episode. We're going to continue to take automotive challenges and turn them into gold. We'll see you next time on Automotive Alchemy.
Shean Kirin:Thank you.