Social media is a “huge phenomenon that is not going away — it's here to stay,” says John Holt, CEO of the Cobalt Group Inc.

Accordingly, dealers shouldn't sit on the sidelines while the rest of the world plays the social- media game, he says. “The question is: What's the right way for dealers to use it.”

It's inexpensive for a dealer to maintain the likes of a Facebook page, Holt says. But he doesn't see droves of customers drawn to those dealer Web connections. “They are not looking for a relationship like that with a dealership.”

Still, it is another channel for customer contact. “You want to provide every path to a sale that you can,” he says. “But I wouldn't give up a website to get a Facebook page.”

Consumers are interacting more with dealers online, says, Steve Anenen, president, ADP Dealer Services, pointing to social media as “another way to reach out.”

Social media can help dealers establish long-term relationships with consumers.

But the downside is that a customer with an ax to grind can use the social network as a way to hurt a dealer's reputation.

Social media is “really about reputation management,” says Kevin Henahan, ADP's vice president-marketing.

“It is not about selling cars or sales people blogging to customers. Studies indicate that won't work,” he says. “It's about taking control of your brand.”

ADP offers various social-media services. One of them is monitoring websites, while looking for negative and positive comments about particular dealers.

“If it is negative, you jump on it fast and try to fix the problem,” Henahan says. “If people are saying good things, you want to amplify it. That will drive sales.”