Motorcar Marketing Podcast 001: How Car Dealers Can Maximize Sales From Craig’s List Marketing (transcript)

This is a transcript of Motorcar Marketing Podcast 001: How Car Dealers Can Maximize Sales From Craig’s List Marketing.

Welcome to episode one of the Motorcar marketing podcast. In this episode’s main segment, I’m going to be talking about how to effectively use craigslist to sell more cars. Craigslist has made a number of big changes to the cars for sale by dealer section, and I’ll be talking about these changes and how they impact car dealers so stay tuned for that.

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A couple of quick notes, any websites or links that I mention in the podcast can be found on the blog and show notes. I also publish a transcript with every episode in case you’d rather read the show or look at something later on. You can find all the podcast show notes at www.motrcarmarketing.com/podcasts.

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So now, let’s get into the main segment. Today I’m going to be talking about craigslist and how you can sell cars on it. Let’s go ahead and get started.

So the big question is, is it still worth the five dollars to advertise on craigslist? As I’m sure most of you know, everything changed for car dealers on craigslist on December 3, 2013. They made a bunch of big changes but most notably , they began charging five dollars per ad. I thought the number one question that car dealers would have is, is it still worth the five dollars to advertise on craigslist? So let’s try and answer that question right off the bat. First, I just want to just preface this by saying there is no right answer. Each dealership is different so there is no one-size-fits-all answer to this question. The single biggest variable on craigslist is price. If you price your vehicles aggressively, you will get a lot of calls. If you don’t price them aggressively, then you won’t get a lot of calls. It’s really that simple. Most of the dealerships that I talk with are paying five to ten dollars per phone call from sites like autotrader or cars.com. If you don’t know your costs per call for your various advertising channels, then you need to figure that out properly by using some tracking phone numbers. Overall, what I’m seeing with the dealers that I work with is that the dealers who used to get a lot of calls from craigslist are still getting a decent number of calls. The overall call volume is only down slightly, and the call quality is actually higher. I’ll talk more about that in a second. Believe it or not, even back when the ads were free, craigslist didn’t work for every dealer. Some dealers simply didn’t price their cars well enough to get enough calls to make the free postings worthwhile, and the same still holds true. It’s not going to work for everyone. It’s not much different than it was before the five-dollar per post change in December. It works for some dealers and doesn’t work for other dealers. What I suggest to all dealers is to simply go on and post twenty or so ads and see what sort of call volume you get. Track the calls carefully and then figure out the cost per call and see if it’s worth it for you. And this isn’t just for craigslist obviously. This is for any marketing channel that you use—newspaper ads, radio ads, TV ads, and, of course, all types of online advertising. You should be testing and tracking all channels constantly to make sure you’re getting value from the advertising.

So I want to talk about one of the benefits of the recent changes. Obviously when you’re paying five dollars per ad, you want to maximize your ROI. You also want to make sure you follow the rules that craigslist set so you don’t get all your ads flagged if you just paid five dollars for them. Before changes in December, for nearly all dealerships I worked with, they were posting ads all over Southern California in many different craigslist sections, not just the section they were actually located in—Los Angeles, Orange County, Inland Empire, San Diego, Palm Springs, Ventura, Bakersfield, and a few others. If you’re not familiar with Southern California, suffice it to say, this covers a span of about 200 miles. So in many cases, potential customers were calling expecting the vehicle to be local when it really wasn’t. But since the ads were so cheap, the dealerships didn’t care; they wanted their ads posted in sections that they really shouldn’t have been posting them. It was just a matter of posting as many ads as possible as quickly as possible. So a lot of people who called were not good prospects, and the conversions on the calls were much lower than the conversions on the calls that are coming in now because now dealers are only posting in the actual area where the dealership is physically located. And since now we are following the rules that craigslist has set up, we are also able to take advantage of a lot of other useful features that they’ve created. I’ll talk about those features in a moment. So think about what I just said, the cost per call from what I’m seeing, the dealers that I’m working with hasn’t changed much. The call volume is roughly the same as it was before the five dollars per post change, but the quality of the calls has actually gone up and improved. So is it worth it to pay five dollars to advertise on craigslist, I would say it definitely is. Most of the dealers that I was working with before the change are still posting on craigslist and it’s still working for them. But it doesn’t work for everyone so you have got to test it and see before you start buying. You’ve got to test and see if it’s going to work before blindly throwing money at it. Things can change quickly with online marketing so this might not always be the case. You’ve got to just keep periodically looking at your stats, figure out your costs per call, and make sure it’s still working for you. My assessment is that it still works for most dealerships, but again, you want to constantly be tracking and testing it. So in the future if things start to slow down, you’ll know that you are no longer getting a good ROI from it.

So what are the rules for posting in the cars-for-sale by dealer section? Now let’s take a step back and take a more complete look at the new rules that craigslist played out in December. The new rules are really pretty simple. As I mentioned earlier, the ads now cost five dollars per ad in the cars for sale by dealer section. There are no bulk rates or all-you-can-eat plans. In other words, you can’t just pay a flat fee per month and post as many ads as you want. They want car dealers to place each car in a separate ad. So they’re expecting dealers to place numerous ads per day. So that’s actually a good thing. They used to have some rule like one ad per 48 hours and anything else was a violation of their terms of service. So you were always fighting the flagging and ghosting. So this is actually a good thing. Now you can post, if you have a hundred cars, you can post a hundred ads per month that you don’t have to worry about violating their terms of service because this is basically what they’re telling you to do is post a separate car in each ad. Each ad that you post lasts for 30 days. If you haven’t sold the car, you simply need to place another ad or renew the ad which means paying another five dollars. They’re saying that these five-dollar ads won’t be flagged or ghosted without someone manually looking at them first. So that’s a good thing as well. From what I’m seeing with the dealers I’m working with, that seems to be true. I have yet to see any ads get flagged off. I have seen some ads get a temporary hold, but then the ads usually go in. They will usually publish a couple hours later. So there does seem to be some sort of a trigger that is triggering a manual check, but again, all the ads that I’ve seen seem to go through after this manual check completes. One thing that I’ve found interesting about the new rules, they have an FAQ page where you can read the new rules and they talk about a bulk posting API. You have to buy a block of 6000 hours’ worth of ads to use it, but this is a good thing and a step in the right direction. My guess is this will be opened up more and more as time goes on and the threshold will be lowered so that normal car dealers can use it. If you’re not familiar with what an API is, it’s basically an interface where you can programmatically upload all your vehicles automatically so you wouldn’t have to manually click through the web browser interface. It’s basically like being able to upload an Excel spreadsheet for all your cars instead of having to post them one by one. Again, right now this doesn’t seem to be something they want to offer to just your average car dealership, but the fact that they’ve created this tool means that down the road it probably is something the car dealers will be able to take advantage of. Again, I see this as a real good thing because it will make posting much, much easier.

So now let’s take a look at some of the new features in the cars-for-sale by dealer section. There are a couple things that I think now you can use which you could not necessarily use very successfully before this five-dollar-per-ad change. Make sure when you’re posting your ads you check the box that said “show more ads by this user”. I am seeing a lot of car dealers not using this, and what this does is that it ties all your ads together and puts a link on your ad saying “show more ads by this user”. So a user can be looking at one of your cars; they can click that link and then they can see all your other cars. Before when dealers were violating the terms of service, obviously they didn’t want to leave a footprint so most dealers would not have wanted to use this when they were just basically spamming ads up on craigslist. But now since car dealers are not violating craigslist terms of service, this is a great way for people to look at more of your cars. You also want to use the new contact info section and fill out a phone number. This is a nice way to potentially pick up a few phone calls instead of emails. Phone calls are much warmer leads than emails, and this is the same thing. Before when car dealers were overposting their cars on craigslist, they wouldn’t necessarily want to use this feature because it would have left a footprint putting in the same phone number on multiple ads under multiple accounts would have gotten their ads flagged and their accounts banned. But now since all your cars are under one account, you’re not violating the terms of service. This is a great feature to go ahead and use.

You want to use the new posting details section as fully as possible. This includes Venn number, the condition of the car, whether the title is a clean title or a salvage title. My guess is that craigslist will start to use stuff like the odometer reading, the Venn number—they’ll start to use this stuff more in the search results. They’ll start to use this more and more as time goes on. But mainly, at least in the short term, by using this section, this posting details section completely, you’re creating a much better presentation and making yourself look more professional. So I think again, that’s a real good step in the right direction for craigslist to have rolled those features out.

I also highly recommend that you use the show on maps feature. Again, this will make you look more professional, and since you’re only advertising in the actual section where you’re actually located, this can help let prospects know exactly where your address is. Again, before when dealers were overposting and violating the terms of service, they wouldn’t want to put their address in the ads since it would leave a footprint. Quite honestly a lot of times they were not posting in the section where they were physically located. So it would have just confused people and potentially make people not call in. They now let you upload up to 24 images. It used to be just eight images so take advantage of this. Upload a lot of images; make your cars look really good. Make your ads look really professional and take advantage of the fact you can now upload, as I said, up to 24 images.

One thing that I tried in December was that I would upload, let’s say, eight images of the car I was selling, and then I would upload eight more images of other similar cars that the dealership had. I did get some ads at that point. They got flagged off and they got put on a temporary hold and so I stopped doing this. And since I stopped doing this, nothing has been flagged since. So at this point I would not try it. It seems to go against the rules that they’ve laid out for only advertising one vehicle per ad. But keep an eye on this. If other dealers start to do this, you might just decide that it’s okay. I mean, it doesn’t seem like it’s really that big of a deal to put in some other pictures of other cars that are similar in the ad, but again, this seems like this violates what craigslist has laid out in terms of their new rules. So short-term I wouldn’t do it, but look at the ads that people are posting and see if other dealers start to do it, and if they seem to be getting away with it, it might be something to try in the future.

So the big take-away from these rule changes is that we no longer have to spend a lot of time trying to outsmart craigslist. We’re not playing this cat-and-mouse game. We don’t have to worry about clearing our cookies, switching our IP address and managing dozens of phone-verified accounts. In fact, you shouldn’t be doing these things because now you want people to tie all of your ads together. Craigslist is specifically telling us to post as many ads per day as we’d like as long as it’s just one once every-30-days per vehicle and, of course, we’re willing to pay the five dollars per ad. Now the whole focus as far as I’m concerned is trying to appear as professional as possible and really trying to differentiate yourself from the individuals on craigslist and the other less-than-professional dealerships. There are people who want to buy from reputable dealers. They need financing; they want guarantees. They want you to know that they’re going to have some recourse if there is a problem with the car. So there are people on craigslist looking to buy from dealerships. So you want to make yourself look like a dealership, and you want to really, really make yourself look like a good professional dealership so you stand out above the other dealers.

Now I would like to run through a few frequently asked questions that I get from car dealers about craigslist. Here’s the question. What do you think of posting in the cars-for-sale-by user section. These ads, of course, are still free. So that’s why dealers are asking. I get this question quite often. I would highly discourage this even if you can figure out all the various craigslist variables like clearing your cookies, switching your IP address, and creating a ton of phone-verified accounts, ultimately you’re going to constantly playing this cat-and-mouse game with craigslist trying to avoid detection. That takes time and effort so it’s really not free anymore. But more importantly, the people who call you won’t be great prospects because they’re going to be thinking that you’re an individual, not a dealer. There are some advantages of buying from a dealership as I just mentioned like warranties and financing, and some people understand this so they specifically only want to buy from a dealer. Those are exactly the people who you want to have calling you, and the only way you’re going to do it is to post properly following the craigslist rules in the proper section. With the recent changes, I think it’s just a matter of making your ads look as professional as possible, trying to differentiate yourself as much as possible from the individuals selling cars on craigslist. So the bottom line is I wouldn’t try this.

Here’s another question. Can you put your website’s URL in craigslist ads? You can put your URL in the ad, but it is just plain text so it’s not clickable. Craigslist has specifically disabled clickable links in the cars-for-sale-by-dealer ads. But this question makes me cringe when people ask it. To me it shows a lack of understanding of the flow of your sales funnel. Why would you want someone to go to your website when you could have them call you? A phone call is a much warmer lead than sending someone to your website. So make sure you put your phone number in the see-all-ads. And make sure it’s very prominent so people see it and they can call you. And then, of course, use tracking phone numbers too.

There’s this old baseball saying get em on, get em over, get em in. The objective of craigslist ads isn’t to get people to go to your website, it’s to get them to call you so you can set up a test drive, and then once you have them in for a test drive, you try and close them. One big mistake I see from a lot of dealers I’ve worked with is that they have terrible sales guys picking up the phones. This is such a huge mistake. What I’ve seen is the larger dealerships aren’t as aggressive on price, but they usually have better sales guys picking up the phone so they can get more out of each lead that they get. So keep this in mind too when you’re evaluating the cost per call. You might not be able to make your costs per call go down, but you might be able to increase the value of each call that you get. So really make sure you have good people picking up the phone. This is absolutely crucial, and obviously this is crucial, not just for craigslist, but for autotradercars.com, any advertising is generating phone calls. This isn’t super complex stuff either; it’s really just salesmanship 101. Make the customer feel like the car he’s calling about is a great car and a great deal; create urgency. Engage with the customer. Be friendly and polite, just simple salesmanship can go a long way in trying to get the customer in for a test drive. And I’ve seen many dealerships where the person answering the phone doesn’t understand even these very basic items of salesmanship.

Now let’s talk for a second about tracking phone calls. I’ve talked about this a few times in this podcast episode. I talked about how important it is to track where a lead is coming from, but recording the phone call can also help you train your employees. This goes back to what I just talked about with getting good people to answer the phones and listening to their calls and training them is a great way to improve their performance. So let’s talk a bit about how to track and record phone calls. This is a service that we currently offer. You can get as many tracking phone numbers as you like. You can use our nice leads-tracking interface and assign leads to salesmen, mark the leads as follow-up or sold or dead or whatever you’d like in terms of status. It’s a comprehensive lead-tracking tool that really allows you to manage all of your leads efficiently. Keep in mind, too, that this isn’t just about me showing my own services. All car dealers should be tracking their leads carefully, and there are lots of other services out there besides mine. Hopefully you’ll check out my service as well, but there are certainly a lot of them out there. But I would strongly urge you if you’re not tracking your phone calls to track your phone calls; get some tracking phone numbers whether you use our service or another service, get some tracking phone calls and start using them for all of your advertising channels. Compare your ROI and really figure out a drill-down and figure out which channels are actually producing a good value and which channels are bringing you the most calls and the most sales.

Another thing I mentioned in this podcast is making your ads look professional and really trying to separate yourself, certainly from the individuals selling on craigslist, but also separating yourself from other car dealers who are posting on craigslist. Basically what this means is using some sort of a professional-looking HTML ad. This is another service that we currently offer. Again, there are many other services so it’s not just about me trying to show my services. I definitely think—and this is something you should be doing. It’s easy. It actually makes posting ads easier. All you have to do is go to whoever is supplying you with these templates, you go to that page, and then you can just copy and paste the HTML code straight into the craigslist ad. So it actually makes things much easier. It manages the images so it’s an easier process for posting the ads and, not only that, the results are much better. You get much cleaner ads, much nicer-looking ads. So if you’re not using some sort of a professional-looking template, I would strongly urge you to do that.

The other thing I just want to mention is that we can actually post your ads for you. We just charge one dollar per ad so your total cost would be six dollars per ad; that’s a five dollars for the craigslist fee and then the one-dollar-per-ad for us. What we’ve found is that our service is actually cheaper than having an employee do it because even a ten-dollar-an-hour employee has a tough time posting ten ads per hour, and he generally won’t do as good a job as we can do. We make sure your cars are always listed. If you have a ten-dollar-an-hour employee handling this, mistakes are quite likely to happen or if you’re a small dealership and it’s a small shop, things typically will slip between the cracks. Your cars won’t get posted. If you use a service like ours, we make sure that your cars are always getting posted. Our serviced really is a hands-free system. We take care of everything. You just basically answer the calls when they come in. We do all the posting; we manage all the images. We manage all the phone-verified accounts. Everything that you need to do we manage it. We get the ads up on craigslist for you. We also supply a tracking phone number so if you use our craigslist posting service, we give you a free tracking phone number so you’ll actually see the results from craigslist. So that’s another nice advantage to using our service.

Again, I just want to make it clear; I’m not just trying to show my services. I really think our services are great, but there are a lot of other similar services offered by other companies so feel free to check those out as well.

If you want some more details about posting on craigslist, I actually did a full video where I do a deep dive into some actual statistics for dealerships that I work with, and this is available for free. To get that video, just go to www.motorcarmarketing.com and fill out the form in the right-hand sidebar, and we’ll send you access to that video.

So the main take-aways from  posting on craigslist are: If you’re not posting on craigslist, you should give it a try for sure, track your calls and see if it generates a positive ROI. If you are posting on craigslist, and you know it’s working, make sure you use a professional template and all the extra features that craigslist has rolled out like the maps, the more ads by this user, and all the other things that I talked about earlier. If you’re posting on craigslist and you’re not sure it’s working, simply get a couple of tracking phone numbers and start using them in your ads.

As always, if you have any questions or comments about today’s show, please let me know. You can email me at info@motorcarmarketing.com. If you have any questions about any of the services that I mentioned. Again, check out our website motorcarmarketing.com. I will put links in the show notes. Just go to motorcarmarketing.com/podcasts and look for episode one.

That’s our show. Thank you for listening.