How Steele Auto Group turned social media into sales, at a reasonable cost

Facebook, Snapchat Instagram, TikTok, Pinterest … it seems as if the list of must-do social media keeps growing for dealerships, which must scramble to keep up with diverse, and at times fickle, buyer interests.

A General Motors dealership in Dartmouth, N.S., has found a way to tame the social media beast, however, with tactics that drive sales and service. But it didn’t do it alone.

Steele Chevrolet-Buick-GMC-Cadillac contracted with Dealers United, a U.S.-based social media automotive marketing firm, to develop and execute a strategy employing the most popular platforms.

With Dealers United’s help, Steele brings buyers into a journey that leads to not only a successful sale but also a service relationship that reaches well beyond the day of delivery, say both the social media company and the dealership’s general manager.

“Facebook is a tool. It’s not going to do it [make the sale] for you,” said Colin Jamieson, general manager of the dealership. “It’s how you utilize the tool.”

The experiment with the Steele store was so successful that Dealers United, which formally entered Canada last fall, is using the results to promote its product.

SO GOOD, IS IT BROKEN?

The case study ran from Jan. 1 to March 1. In that period, there were 602 leads from meta ads (paid messages written in the voice of a business) and 90 unit sales matched to the leads. That’s a conversion rate of 14.95 per cent and a cost per unit sold of $77.78. A typical advertising cost per unit sold is about $300, said Brooke Jensen, vice-president of marketing for Dealers United.

“It’s crazy,” Jensen said. “When we ran this metric, we thought something was broken.”

Dealers United takes an omnichannel approach to advertising based on social media, said Molly Dennehy, the company’s brand manager. Instead of focusing on just one social medium, such as Facebook, the company custom tailors posts to each platform.

“Facebook is still King Kong [in terms of reach], but we are seeing great results” on other social media, Dennehy said.

Every social platform appeals to users in different ways, Jensen said. Facebook and Instagram are typically used to catch up with acquaintances, TikTok is for entertainment, and Snapchat facilitates more intimate interactions with close friends.

While Dealers United’s research found that seven in 10 buyers are influenced by social media, users are “nomadic” in that they jump from one platform to another depending on their interests at the moment, she said.

“Many dealerships are not doing social media well” and failing to reach the potential audience, she said.

“It’s not easy. It’s a lot of work to do it correctly.”

LET’S EXPERIMENT

The Steele store’s relationship with Dealers United began about five years ago. Chris Beaton, then the dealership’s sales manager, heard of the company and pitched the idea of working with it. Beaton has since been promoted to general manager of Halifax Chrysler-Dodge, also owned by Dartmouth-based Steele Auto Group, which has 51 dealerships in Atlantic Canada and eight in Texas.

Senior group management was willing to let the dealership experiment, Jamieson said. The team at Steele Chevrolet-Buick-GMC-Cadillac confers regularly with Dealers United, brainstorming ideas for social media campaigns.

“They do a good job with content creation,” Jamieson said.

Facebook posts feature new products, price discounts and dealership news, such as one recent video in which a sales associate talks about delivering the first 2023 Chevrolet Colorado pickup to a customer.

The posts’ topics run the gamut. Brand awareness ads show shoppers what sets the dealership apart from the competition.

Ready-to-buy ads promote available inventory, create excitement for the latest model lines and explain incentives.

Conversion/lead ads pair the dealership’s inventory ads with calls to action, such as submitting a form on Facebook to schedule a test drive. The Steele Chevrolet team does “matchback” reports to determine how many buyers were sourced from one of the social media contacts. It is hard to be certain where each lead is generated, Jamieson said, but it appears Dealers United’s social media posts have a “shockingly high conversion rate.”

SALES SUCCESS

Sales, also boosted by easing supply chains, are increasing. The dealership is on track to sell 2,500 new and used vehicles this year, said Jamieson, compared with 2,000 in 2022, before the Dealers United test case.

Steele executives have taken notice and plan to introduce Dealers United’s tools at its other stores, Jamieson said.

The insights from the campaigns “allow you to be a lot more granular,” Jamieson said.

To ensure successful use of the tool, he said, the dealership constantly refreshes the information and customer data it sends to Dealers United. Sales staff meet with the company’s representatives weekly to review ads and discuss what is working and what isn’t.

As traditional media advertising declines, “dealers are receptive to the next thing,” said Dealers United’s Dennehy.

“We need to make sure the platform is built for the dealership.”