FCA tracks how well the companies use their ad-word spend to convert leads. Google rolled out the concept to the automaker and helped launch a pilot nearly six months ago. Now FCA has taken it over and, in early April, told media agencies to follow the new strategy.
The automaker is working with media providers to show them that, if they're in the bottom fourth of overall performers, they're ineffective, Laymac said. FCA is giving those low performers 90 days to turn around their results and follow the new strategy. If they can't hack it, FCA will notify the dealerships working with those companies that they have 60 days to find another provider.
"I call this digital Darwinism," Laymac said. "But it's assisted Darwinism, because we are helping all the providers get better."
The technology may be complex, but the reasoning behind FCA's move is simple. As vehicle shoppers begin their journey, many of their search criteria are on the automaker brand website — whether a Jeep Grand Cherokee comes in Velvet Red or a Dodge Challenger has ventilated seats, for example.
As shoppers zero in on a purchase, they should be steered toward a dealership website and search terms such as "incentives," "Wranglers near me" or the dealership's name, Laymac said.
But this isn't how the process was operating at the dealership level.
"Nobody was buying the ready-to-buy terms; everybody was buying terms like 'Jeep' and Wrangler,' " Laymac said, adding that the companies even often left out the dealership's name.
A big reason for that was because the largest amount of clicks were found with the brand search terms. But conversions were most successful when the marketing companies focused the terms where they belonged, Laymac said. Since launching the pilot, FCA dealerships have more than doubled leads for the same media spend, and they have been converting them at a higher rate.
David Kelleher, president of David Dodge-Chrysler-Jeep-Ram in Glen Mills, Pa., said he supports the move. Kelleher, a member of the FCA dealer council's marketing and communications committee, said dealerships sometimes have two or more competing digital marketing vendors. A dealership's website provider could be buying ad words for the store, while a separate digital marketing company is buying the same ad words, thus driving up the costs of the search terms.
"There's just so many competing entities," Kelleher said.
Since FCA began implementing the change, some dealers have worried that they could lose some control over how they spend their digital marketing dollars, Kelleher said.
"I get that thinking," he said. "But in this particular space, naturally, we need to collaborate."
Meanwhile, Laymac suggested that more efficient media companies are more likely to survive the new setup.
"The big ones are the ones that are very scared," Laymac said, without giving names.
"The small, nimble ones are the ones that jumped right on board."
That is because those smaller providers already were tailoring individual approaches for the dealerships they work with vs. applying a broad template, he said.
As FCA's program progresses, the small providers could end up displacing the larger ones, Laymac said, and the number of total providers FCA certifies could be greatly reduced.
"And I'm good with that," Laymac said. "Again, that's digital Darwinism. That's the way it works."