Clickthrough rate concisely, is the measurement of the responsiveness of users when interacting with your ads. It is calculated by taking the total number of clicks on your ads, and dividing by the total amount of times the ads were shown, or the impressions. The average clickthrough rate for the automotive industry is 2.14% for paid search advertising.1 If your dealership wants to be exceptional, you must outperform industry averages, and that is precisely what J&L Marketing worked with Cape Girardeau Honda in solving.
Clickthrough rate essentially boils down to several key elements:
- Keywords that you are actively bidding on only
- Keywords that you are negatively matching against
- Persuasive ad copy
- Ad position
Our first hurdle was to analyze and optimize the keywords that we were actively bidding on. By using Google’s Keyword Planner, we were able to gain a better understanding of keyword volume and competition (i.e. how many competitors are actively bidding on a specific term). Additionally, we utilized an industry leading online competitive analysis tool which gave us valuable insights on real-time keyword buy, market share, and ad copy.
Second, we needed to analyze which keywords we were bidding on that were triggering irrelevant queries. To maximize our ad budget, we needed to trim the fat on our keyword buy. By leveraging search terms reporting, our competitive analysis tool, and by combining negative keywords by different match types, we could filter out wasted clicks.
Another enhancement that we leveraged was writing persuasive ad copy. By following industry best practices and taking advantage of expanded text ads, we were able to write compelling ads that resonated with our search audience. Additionally, we utilized VIN specific dynamic ad copy that updated both the ad and landing page specific to a user’s exact query.
Lastly, we focused on improving our average position for our ads. Research shows there is a very strong correlation with higher position and a higher clickthrough rate.2 By maximizing our bids, and increasing our overall quality scores, we could increase our average position without increasing our overall ad costs.
Within the first month of implementing these changes, we already saw an 85.59% increase in overall clickthrough rates! Even though we were already outperforming the industry average in our first month (June 2016 – 4.44%), by December 2016, our paid search clickthrough rate had reached 13.22%! So, by the end of the year we had increased our clickthrough rate by 197.75%, and was outperforming the industry average by over 6 times.
We have since made further improvements in overall clickthrough rates by following our proven process. In June of 2017, we recorded a clickthrough rate of 14.97%. Additionally, we have shown remarkable improvements in quality score, and reduced our average cost per click from $3.61 (June 2016) to $2.49 (June 2017).
In an increasingly competitive online landscape, it is crucial to stay one step ahead of the competition. By constantly refining your keyword buy, negative keywords, and ad copy, you can consistently outperform the industry. Don’t be average, be exceptional.