Chrysler's New Online Strategy

Chrysler LLC is overhauling its approach to online marketing and will begin rolling out its new strategy to its dealers in the next couple of weeks.

Dealers will pay 40% - 60% less than the market price for leads and websites under the new program.

The strategy also will integrate all of Chrysler's and its dealers' online marketing efforts.

“We have two goals with the new program,” says Chuck Sullivan, director-interactive for Chrysler. “We want to help our dealers catapult in the digital space and we want to drive incremental sales for Chrysler.”

Deborah Meyer, Chrysler's chief marketing officer, started meeting with Sullivan in December to begin laying out the plan. Sullivan at the time was with Organic Inc., an online agency that helped Chrysler with search-engine marketing. He came on board with Chrysler in May.

During the first phase of the launch, Chrysler is revamping the way it buys online leads from third-party vendors and pushes them down to its dealers.

The auto maker has locked up deals with all of the major third-party vendors to provide leads at a significantly lower cost than the average $20-$30 per lead most dealers pay today.

According to one dealer on Chrysler's Internet advisory board, Chrysler will charge its dealers $18 per lead.

Sullivan declines to confirm the price but says discussions with lead providers “were rigorous and interesting.”

Chrysler will monitor each vendor's performance on a daily basis, Sullivan says.

The second phase begins in late September, when Chrysler will begin launching new websites for its dealers. The new sites will be customized for each dealer using vendor Dealer.com's platform.

The program is voluntary, but dealers will only be able to receive leads from Chrysler's brand site if they participate. Sullivan believes dealers will find the program's cost and value attractive.

Dealers will be offered a 30-day free trial to use the new website. Following the 30-day trial, dealers will have three packages to choose from at varying price levels. Dealers will pay 40% -60% less than the market price for the sites offered through Chrysler's program.

Dealer.com's platform will provide dealers with more customization than the current 5-star websites they now have. Chrysler says the sites also will integrate better with its brand websites allowing for better access to pictures and inventory listings.

Also attractive to dealers is the ability to link to their other brands, and as a result, do away with having to maintain multiple sites.

Helping to coordinate the new strategy is Shift Digital, a new digital marketing firm created by Steve St. Andre, who recently was president and chief operating officer of FordDirect.

St. Andre also is putting together the deals with Chrysler's online vendors, ensuring dealers get value at a reduced price.

“This is the biggest network play out there,” St. Andre says.

The third phase will integrate all of Chrysler's and its dealers' search-engine marketing efforts into one cohesive strategy and will begin sometime early in 2009, probably following the National Automobile Dealers Assn. convention.

The strategy should clear up a lot of the confusion surrounding search engine marketing in the dealer space. For most auto makers, including Chrysler, online digital efforts have been, in the words of one dealer, “discombobulated.” Automotive advertising happens on three levels: tier-1 is the auto maker; tier-2 are the regional dealer ad associations; tier-3 are the dealers.

The problem is there is little to no coordination between the three levels. It's basically an “each man for himself” strategy, with each group buying their own key words.

The result is that auto makers compete against their own dealers for relevant search terms. Dealers, meanwhile, compete against themselves if they are part of an association that buys search terms. They're also competing against their own manufacturer. All this drives the cost of search terms higher.

Under the new program, Organic, working with Shift Digital, will align all of the search activity to make sure the three groups work with each other instead of competing.