Considering what auto dealers spend on search-engine marketing, it fails to attract a lot of customers, according to a new study by Dataium.

On average, 55% of dealer online advertising budgets go toward so-called SEM, but only 6% of dealership website traffic comes from paid search keywords, the study says. 

Less than 1% of this traffic resulted in email leads submitted through dealership websites, according to Dataium, an aggregator of online auto-shopper behavior.  Cars.com, an online automotive marketplace, commissioned the study.

Dealers seeing most of their online traffic coming from websites mistakenly can think it is the result of SEM, rather than search results unrelated to paid placements that appear at the top and right-hand column of sites such as Google.  

“Because our study was able to look beyond direct-referral traffic, however, we found that the majority of search-engine traffic comes as a result of a consumer typing a variation of the dealership name into the search field,” Dataium President Jason Ezell says.

That suggests consumers are forming impressions from assorted sources early in the shopping process, he says. “Search engines often are the taxi taking them to the place they’ve already decided they want to go.”

Conducted between January and June, the study measured the activity of more than 20 million automotive shoppers per month on Dataium’s network.

According to Dataium, automotive marketplace websites such as Cars.com, AutoTrader.com and Edmunds.com influence purchase decisions because they facilitate the research process and link shoppers to a specific vehicle. 

Those websites provide varied content, including research, comparisons, pricing, inventory and reviews, “all of which advance a shopper toward purchase,” Ezell says.

Nearly 80% of direct referrals from search engines during the Dataium tracking were driven by keywords that were a variation on the dealership name, representing traffic a dealership theoretically would receive through high rankings in organic search results, regardless of the level of paid SEM spending, the study says. 

In commissioning the study, Cars.com sought to “provide dealers with information about the quality, not just the quantity, of their online investments,” he says.

While dealers invest in SEM for reasons beyond driving traffic and leads on their dealership websites, Dataium claims most visitors referred to dealer sites by search engines likely have already formed impressions.

“Dealers know that there’s more to the story than the last source a consumer visited prior to clicking over to the dealership website,” says Michael Page, Cars.com’s vice president-advertising solutions. “Dealers have access to more data than ever before, but it remains difficult to see all of the sources that contributed to a sale.”

Dataium does not recommend dealers stop investing in paid SEM. Instead, the firm suggests dealers’ marketing investments focus on reaching auto shoppers at the right times and in ways best suited to influence the purchase process.

Meanwhile, marketing consultant Chuck Barker contends Google is showing signs of “jumping into auto retailing at the dealership level to boost their advertising revenue.”

He predicts Google may shift its emphasis from charging dealers for keywords and clicks to charging for customer leads.

Barker also speculates in an Impact Marketing and Consulting Group report that Google ultimately may buy a public dealership group.

sfinlay@wardsauto.com