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Are Dealers Measuring These 8 Facebook & Instagram KPIs?

Having trouble understanding how your dealer’s digital campaigns are performing? If so, you’re not alone. This is a common challenge for dealers and advertisers in general.

To help you out, I compiled a list of key performance indicators (KPIs) that are MOST HELPFUL for dealers so they can effectively evaluate the performance of their dealer’s social media campaigns.

Social media advertising’s role for automotive dealers
First, let’s take a look at the role of social media advertising in a car dealer’s marketing mix. Social media marketing can be effective at every stage in the sales funnel. Typically the OEM covers high-funnel efforts to build brand awareness around new models. So, at Dealer Teamwork, we see social media advertising driving the most value for dealerships with mid-funnel researching shoppers and low-funnel decision making shoppers.

This doesn’t mean that dealers should never try any other strategies with social advertising. This is where we recommend starting and dialing in your efforts. Each dealer and market will be different, but these strategies almost always drive the most value across the board.

If you want more tips for setting up social media campaigns, read our blog on best practices for Facebook and Instagram advertising beginners. This blog also goes over Facebook and Instagram campaign structure, which will be helpful to know before you read the next sections.

KPIs for mid-funnel research strategies
Before we jump into the KPIs for mid-funnel research strategies, it’s important to first understand your objective. Shoppers at this stage in the car buying journey are getting more serious about their research. They are looking to make a decision about which type of car they ultimately want to purchase, and they are starting to look for dealers with those vehicles available in their area.

With that in mind, the KPIs that Dealer Teamwork looks at are as follows (metric definitions at the bottom of the page):

  • Reach
  • Frequency
  • Link Clickthrough Rate (CTR)
  • Cost per link click (CPC)

At this stage in the car buying process your goal is driving a lot of relevant traffic at the lowest cost. You want to show that you have what a shopper is looking for and initiate a connection between the shopper and your dealership.

Reach helps you know how many unique people are seeing your ads. If this number is low, something may be off with your targeting or daily spend allowance.

Frequency tells you how often shoppers see your ad. Dealer Teamwork aims to show these ads 1-2 times per week per user. You don’t want this number too high for a few reasons. One, showing the same ad over and over again to the same shopper doesn’t give them any new information. Two, shoppers repeatedly clicking this ad can be wasteful. You want to generate a high volume of clicks here so you can build up your audience for targeting with lower-funnel ads later.

CTR is important to look at in conjunction with reach and frequency. It’s important to show your ads to the biggest audience possible, but you also want them to engage with the content. Success of mid-funnel strategies is a balance of generating awareness (seeing your ad) and clicks (engaging with your ad).

Finally, CPC is important because you are trying to drive a lot of traffic with this strategy. If you spend too much money per click, you limit your ability to achieve that goal. CPC will vary by dealer and market. If you use a social media vendor, they will be able to provide a target CPC recommendation.

KPIs for low-funnel retargeting strategies
Let’s look at the objective again first. Shoppers at this stage in the car buying journey are finishing their research. They are narrowing their search to the 1-2 dealers that have the vehicle they want in stock at their ideal price point.

With that in mind, the KPIs that Dealer Teamwork prioritizes are as follows:

  • Link Clickthrough Rate (CTR)
  • Leads
  • Cost per lead
  • Purchases (sales measured with Facebook’s offline conversion measurement tool)
  • Cost per purchase (cost per purchase with Facebook’s offline conversion measurement tool)

At this stage in the car buying process, your goals are driving repeat traffic and actionable leads (calls and form submissions). Achieving these results means you are reaching the right audience with the right message, and you are driving them towards a purchase with your dealership.

CTR is, again, a KPI here because you are looking to continue engaging your audience. If this metric is low, your offers may not be competitive with the competition. You may also want to highlight the benefits of buying from your dealership versus your competition. As shoppers move farther down the funnel, you will want to prioritize cost per lead and cost per purchase higher than CTR.

Leads will also help you gauge if you are meeting your shopper’s needs and wants. Shoppers typically don’t reach out to a dealer by phone or email if they aren’t in the final stages of making their purchase decision.

If you don’t have a goal in mind for cost per lead, collect a baseline number after a few months of running ads on Facebook and Instagram. Monitor this metric as time goes on to ensure your campaigns are driving results at an efficient price point. Some fluctuation is normal, but huge spikes are cause for re-evaluating your creative, targeting, budget and competition in the market.

You can track how your Facebook and Instagram ads influence vehicle purchases by setting up offline conversions, also known as sales matchback reporting. There is some manual effort and a set-up period involved, but it’s worth the work. Once set up, this tool gives you an aggregate number of shoppers who made a purchase after viewing one of your ads. Facebook attributes sales up to 28 days after someone viewed an ad, so it’s important to upload your CRM data frequently (on a monthly basis at minimum).

Cost per purchase, like cost per lead, is important to watch over time. Set a baseline, then watch it on a regular basis. Again, some fluctuation is normal, but huge spikes should trigger review of your campaign creative, campaign set up and potential market influences.

Are these the only metrics to watch?
This begs the question, “why are there so many additional metrics in Ads Manager if these are the KPIs I should be looking at?” As with any advertising efforts, there are always additional supporting metrics that help you determine the health of your campaigns. Also, if you try different campaigns with different objectives, you may consider other metrics to be your KPIs.

For example, watching Amount Spent. Monitoring this metric helps you understand if you have enough budget to achieve your goals. However, looking at this metric by itself doesn’t shed much light on performance.

As you get more familiar with running campaigns on Facebook and Instagram, the meaning behind other metrics becomes more apparent. One easy way to start getting familiar with other metrics is to simply hover over them in Ads Manager and read the definitions.

Hovering over metrics in Facebook Ads Manager to learn the definition

KPI Metric definitions
Below are Facebook’s definitions of each metric as found in Ads Manager for reference.

  • Reach: The number of people who saw your ads at least once. Reach is different from impressions, which may include multiple views of your ads by the same people.
  • Frequency: The average number of times each person saw your ad.
  • Link Clickthrough Rate: The percentage of times people saw your ad and performed a link click (clicked your ad’s destination link).
  • Cost per link click: The average cost for each link click.
  • Leads: Dealer Teamwork measures Click to Call and Form Submissions. We set these up as custom conversions. They are tracked as the number of lead events tracked by the pixel on your website and attributed to your ads.
  • Cost per lead: The average cost of each lead (Amount Spent / Leads).
  • Purchase: The number of purchase events attributed to your ads, based on information received from one or more of your connected Facebook Business Tools.
  • Cost per purchase: The average cost of each purchase (Amount Spent / Purchases).

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Your not-so-average Joe with an interest in everything automotive, digital marketing and social media.
Visit Generations Digital
Apr 12, 2019
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Heaven
First Name
Jacques
Considering half of Facebook and I would presume Instagram traffic is fake, I would say they probably should shy away from spending too much there. Gee... let me guess, you're pitching FB and Instagram advertising?
 

Alexander Lau

Sr. Refresher
Feb 11, 2015
2,406
719
113
Mars, PA
First Name
Alex
Considering half of Facebook and I would presume Instagram traffic is fake, I would say they probably should shy away from spending too much there. Gee... let me guess, you're pitching FB and Instagram advertising?
YOU BETCHA'!

Huh? The guy who lead the research created one of the early prototypes with Zuckerberg, while at Harvard.
It's like agencies using Nielsen, because it's the only thing they had at the time.

PlainSite Facebook Reality Check (PDF)

What seems too good to be true often is. The zeitgeist has changed markedly since 2007, when the company was the obsession of virtually every Silicon Valley investor, having built its Platform to make the world “more open and connected.” Yet as bad as things have been of late for Facebook, with endless privacy breaches and Russian interference in the 2016 presidential election hanging over Menlo Park like a spectre, we believe that the situation is far worse than investors realize. Facebook has been lying to the public about the scale of its problem with fake accounts, which likely exceed 50% of its network. Its official metrics—many of which it has stopped reporting quarterly—are self-contradictory and even farcical. The company has lost control of its own product.

:huh?:
 

Joe Friedrichsen

Getting Refreshed
Jun 19, 2019
40
31
18
Eden Prairie, MN
First Name
Joe
Considering half of Facebook and I would presume Instagram traffic is fake, I would say they probably should shy away from spending too much there. Gee... let me guess, you're pitching FB and Instagram advertising?
Hi Jacques! This article is largely meant for dealers already advertising on social media. Specifically, Facebook and Instagram.

The article is meant to help dealers dial in their efforts and maximize the money they're ALREADY spending on advertising.
 

Alexander Lau

Sr. Refresher
Feb 11, 2015
2,406
719
113
Mars, PA
First Name
Alex
Hi Jacques! This article is largely meant for dealers already advertising on social media. Specifically, Facebook and Instagram.

The article is meant to help dealers dial in their efforts and maximize the money they're ALREADY spending on advertising.
Yeah but, if they are advertising on FB and Insta and the half of their traffic is bogus and botgenic WTF does that do for them? No offense.

@joe.pistell always says, DISC as in Does It Sell Cars? What type of sales attribution are you placing on it?

I see:
  • Cost per lead
  • Purchases (sales measured with Facebook’s offline conversion measurement tool)
  • Cost per purchase (cost per purchase with Facebook’s offline conversion measurement tool)
How are you doing this? Using 3rd party attribution tools or your own? FB conversion measurement tools are pretty bad actually and not set up for auto very well, online and offline (are you pulling data from dealerships' (sales) and pushing that back into FB?). I get that you're attempting to market yourselves with a branded thread (good on you), but there are loads of threads on much of this. Ping them and educate.
 
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Ryan Everson

Sr. Refresher
Mar 21, 2012
325
363
93
Flint, MI
First Name
Ryan
@joe.pistell always says, DISC as in Does It Sell Cars? What type of sales attribution are you placing on it?
Yes, the Facebook ads I run without a doubt generate leads and sell cars at the lowest cost per lead/unit of all our advertising sources.

I hope all of my competitors listen to your 50% fake traffic stat and get scared away from advertising on Facebook while I eat their lunch.
 
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Reactions: Alexander Lau

Alexander Lau

Sr. Refresher
Feb 11, 2015
2,406
719
113
Mars, PA
First Name
Alex
Yes, the Facebook ads I run without a doubt generate leads and sell cars at the lowest cost per lead/unit of all our advertising sources.

I hope all of my competitors listen to your 50% fake traffic stat and get scared away from advertising on Facebook while I eat their lunch.
And I think you're totally full of shit and probably wasting a ton of your dealer's money.
 
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Reactions: Ryan Everson

Ryan Everson

Sr. Refresher
Mar 21, 2012
325
363
93
Flint, MI
First Name
Ryan
And I think you're totally full of shit and probably wasting a ton of your dealer's money.
Alex, you should know from my DealerRefresh posts that I practice what I preach and always have data to backup my claims. I don't BS.

With that being said, here's data from one of my Facebook ad accounts. I'd be happy to share any account or date range to show I'm not cherry-picking the best data. All of my campaigns perform similarly well.

$4,162 Facebook Ad Spend
  • 1,463 leads for $2.84 each with name, email, phone number
  • 64 car sales at a cost per sale of $65
  • $127,731 total gross profit
For every dollar I spend on Facebook, I generate $31 in profit. :dance2:

fb-stats.png
 

Alexander Lau

Sr. Refresher
Feb 11, 2015
2,406
719
113
Mars, PA
First Name
Alex
Alex, you should know from my DealerRefresh posts that I practice what I preach and always have data to backup my claims. I don't BS.

With that being said, here's data from one of my Facebook ad accounts. I'd be happy to share any account or date range to show I'm not cherry-picking the best data. All of my campaigns perform similarly well.

$4,162 Facebook Ad Spend
  • 1,463 leads for $2.84 each with name, email, phone number
  • 64 car sales at a cost per sale of $65
  • $127,731 total gross profit
For every dollar I spend on Facebook, I generate $31 in profit. :dance2:

View attachment 4850
That's fantastic, but you'd generate A LOT more and SHOULD if 50% of their traffic wasn't bogus. How much is wasted? That is the entire point. I don't think anyone can truly answer that, as they're pissing on advertisers' legs, while telling them it's raining. Furthermore, my question stays to him. You ARE at the dealer level, it makes the pulling and pushing of data from your sales numbers into FB, etc., much easier. It's not an easy task for a 3rd party to do such things for dealers (access the worst challenge). I know, I did it at the 3rd party attribution level and it's extremely difficult to scale.

Additionally, you must be pulling some magic tricks across your FB ads, I've never witnessed a top's or group's cost that low in FB and that's a sample size of ~750 dealers (it's generally much higher, so kudos to you). Granted, I'd be defying my own logic as what works in one demographic might not in another. There's that.
 
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Ryan Everson

Sr. Refresher
Mar 21, 2012
325
363
93
Flint, MI
First Name
Ryan
That's fantastic, but you'd generate A LOT more and SHOULD if 50% of their traffic wasn't bogus. How much is wasted?
Alex, you're going to get waste with any advertising source.

Your tv commercial plays while someone is in the bathroom...

Your email campaign gets flagged as spam...

Your YouTube ad is played on a minimized and muted browser window...

Your organic search result is shown to a user 1,000 miles away...

With your mentality, dealers shouldn't advertise anywhere.


I'm going to evaluate my advertising on the KPI's available and make the most informed decision possible.

With that being said, I will take Facebook's $2.84 cost per lead and $65 cost per sale any day of the week.