What are some of the ways you should compare 3rd party inventory providers?
As we’ve discussed previously, the way we hold our vendors accountable is going to differ depending on what service they’re providing. In this example, let’s talk about some ways we can compare a 3rd party inventory listing provider.
On-Page vs. Off-Page
When we’re looking at a 3rd party inventory provider, I like to divide it into two different pools: ‘on-page’ and ‘off-page’. ‘On-page’ (in this instance) refers to traffic that hits our dealer website where we control the analytics, we’ve set up the goals, we’ve set up the conversions. ‘Off-page’ refers to that actual vendor site itself (Autotrader.com, Cars.com, Cargurus.com, etc). The ‘off-page’ stuff can be confusing because everybody can track their data however they want. There’s no continuity between what a VDP or an SRP may be on Autotrader, cars.com, or CarGurus, and there’s no incentive. The only place where we have a level playing field to measure them is once that traffic hits our website -or- when they’ve sent leads directly into our CRM.
Apples-to-Apples
When we can, we want to compare apples-to-apples as much as possible. Things like ‘cost per lead’, ‘cost per sale’, ‘cost per acquisition’, if we’re doing things like ‘having an app to download’, or a ‘service visit’. If they’re claiming that their traffic “is not lead-intended”, fire them. Then we can look at other things like ‘pages per session’, ‘bounce rate’, ‘engagement rate’, etc. The main goal is to make sure that your website has a fair way to evaluate your conversions, and then evaluate all traffic from 3rd parties against the same standard.
Inspect What You Expect
We’re also going to want to make sure we’re taking a monthly meeting with each one of our vendor partners, during which time we’re going to ask them similar questions. Questions like:
- Who in my market is currently outperforming me on your platform? Why?
- What can I change to match their performance?
- Don’t tell me “spend more money”.
- Are there any features of my current package that I’m not taking advantage of? What are they?
- Is my inventory feed sending you all available fields?
- Are there any optimizations I can make to increase my performance on your website?
- Have you made any improvements to your platform since our last meeting? What are they? How can I take advantage?
- Are you working with any 3rd parties to buy and sell my customer data?
- What’s a typical click-through rate I should expect on your website to my website?
- Do you have any new vendor partners you’re working with?
- Are there any new integrations with vendors I’m currently using that I’m not taking advantage of?
- What’s the 1 or 2 things we’re going to work on between this meeting and the next meeting to improve our performance?
Which just about wraps things up for this week. Next week, I’m going to let you know which questions you should be asking your 3rd Party Inventory providers BEFORE you hire them, and which ones you should be asking on a monthly basis to keep them aligned with your goals. See you then.