Have I told you enough about the local affiliate opportunities? Well here is real life case study we just completed.
About 4 weeks ago when the cash for clunkers program was about to start I saw it as a great opportunity to drive leads to a local car dealership. We have a great relationship with Huber Chevrolet in Omaha Nebraska so I called them up and setup a meeting with them.
The Pitch
When you approach companies about driving leads to them its always best if you already have a relationship with them. I can tell you right now if you think you can cold call or walk in asking for the manager of a business its going to be a hard, if not an impossible sale. Like you, since birth I have built relationships by using the services of dentists, optometrists, lasek eye surgeons, bariatric surgeons, plastic surgeons, plumbers, roofers, lawn mowers, photographers, wedding cake makers, and of course car dealerships just to name a few. All of these businesses can benefit dramatically from internet leads.
In this case it was our local friendly car dealership. Now we have purchased many vehicles with them over the years and they knew that I did “computer stuff” but nothing specific.
During the initial meeting I asked a lot of questions.
- On average how much is a sale of a car worth to you?
- Every time a salesman phone rings with a new lead what is that worth to you?
- If I were to send you emails of people who filled out a form online with their name, email and phone number what would those leads be worth to you?
They were pretty fourthcoming with the information. Most companies, especially performance driven commission businesses, will know what these numbers are. If a company has not figured out what a new customer is worth to them…. Its possible you maybe want to help them figure that out first. In fact I would actually say that.
Me: What is a new customer worth to you?
Them: We have no idea.Me: Are you really serious about growing your business?
That is a service in itself but thats for another post.
By the end of the meeting Huber Chevrolet told me about how they had a separate sales division that did nothing but answer phone calls and emails from internet leads and they valued each of those at XX (they asked me not to reveal the specifics).
I told them I would charge them $10 per internet lead (a small fraction of what they are currently paying) but with the condition I could publish a lot of the data on my case study (what your reading). I also told them I wanted to exclusively use MySpace for this test because in past ones we mainly focused on Facebook for driving social network traffic. I really like the super advanced targeting features of MySpace MyAds. They allowed us to target not only cities but specific zip codes. In addition to the geographic targeting we could also target people who were interested in cars or whatever else we thought would convert well.
They were pretty excited to get started. That night I registered hubercash4clunkers.info and had our designer make 4-5 different versions of the landing page rotating through Google’s Website Optimizer to see which one converted the best. Here was the winner converting at 74% (not to bad):
Then we had a bunch of ads made… something like 4-5 per size (there is 3 sizes on MySpace).
Here was the one that converted the best and we ran with:
Our average CPC for this ad was AMAZINGLY low. 13 cents per click on average for over 800 clicks which converted to about 600+ total leads.
Now at $10 per internet lead coming to us its not hard to see how crazy profitable this is.
If you want to get started trying this on your own you should start by downloading my free guide on setting up your own affiliate program. Then signup with MySpace MyAds with code SHOE75 for $75 in free adspend.
There is currently a HUGE dislocation for these social networks…. especially in the local space. SO GET ON IT!!!
About the author...
Jeremy Schoemaker – who has written 2473 posts on ShoeMoney.com.
Hi I am Jeremy Schoemaker and ShoeMoney.com is my blog. 99% of the post here are done by me but you will see others occasionally make guest posts. This blog is fun to write but for my day job I run several online companies.
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{ 120 comments… read them below or add one }
I’m meeting with a local business tonight to discuss their internet marketing. This is great advice that I can use today. Thanks! I’ll be sure to read through your local affiliate guide again before I meet with them.
Yes if you have link with them or link with similar kind of business and proof as well than you will be able to make the deal smoothly.
Its all about the relationship when it comes to partnerships like this. Without it will be brutal to walk through that door about something like this.
This is a beautiful example of the power of a well placed marketing campaign. Thank you very much for sharing all the details with us.
Great friggen post. I did something similar with automotive that I will share in a post sometime soon as well. Really good thinking here, also fantastic creative. You avoided the typical schlocky auto look which is cool.
GREAT post on local affiliate marketing! This is exactly what we have been doing in our area with great results!
Great case study shoe! Localization is the final frontier on the interwebs and will be a natural segway into the mobile space in the years ahead for the marketers that crack the code (which you have so kindly illustrated how to do). We’re going after locals like real estate and insurance as well and are still running into very little competition on the social networks. Good thing no-one ever takes action and really follows through on these gems.
I agree with your saying Denny.
Great post. Very good case study and even at that low lead rate you made a good ROI.
This one on one selling in your local market should really appeal to the traditional bricks and mortar business that still does not completely understand the internet’s power… and the opportunities keep expanding..
More proof to businesses and business owners that if they aren’t marketing on the web, or with new media, they are missing out on crazy amounts of business.
It may be a bad economy for some, but when it comes down to it, this shows you that you control the destiny of your own economy.
Thanks Shoe!
This is hugely Impressive, its a no brainer for a local business who would like to take full advantage of social networks offer. Unfortunately they probably wont read this exciting post whereas I have
They will be calling me uncle “Santa” win, win, cha ching.
Useful post. Local small companies should use the internet marketing much, much more. It is very cheap way for them but there is one big problem. They do not know how to do it.
Now that’s how you present a damn case study!
Good work Mr. ShoeMoney.
A break down in profit versus spend would be nice. How much did you spend on the collateral to setup the campaign versus how much your brought in.
Shoe – extra Ordinary post. Explaining how effective Affiliate marketing can be through Myspace Ads
I agree with your saying of Crazy profits through affiliate marketing, i can not believe that 875 clicks costs only $110 ..lol
I will surely going to try this to see how effective it can be in my case.
Have you heard anything back from the dealership about the quality of these leads? I can’t really say I’ve seen the best quality traffic from myspace (at least running cpa offers) so I imagine it wouldn’t be much different in this situation.
They said they are much better quality then where they were getting it before. They are currently looking to hire some company to run this for them full time.
Its really all about the targeting in the first place and that is why I say getting information like demographics from them is so crucial.
If you just send them a bunch of 16 year old kids I doubt that is going to convert
I was udner the impression that MySpace required you to use their particular format.
But my eyes have been opened to the possibility of full size buttons
Myspace Myads has changed a ton in the last couple months alone.
Wow!!! I remember reading your local affiliate post a while back and thought that’s such a great idea but like a lazy ass didn’t do anything. But with seeing those numbers wow. Now it’s time to start networking and get my local affiliate business going. Thanks Shoe!!
One question I want to ask here is how did it back out for the dealer?
It is possible that not all of these leads wanted a Chevy. Since this is only a Chevy dealer and it doesn’t say it on the ad (other then the landing page) how many leads came through that didn’t actually want a Chevy?
Thats a great question.
This is also why we started doing the leads for only $10 which was a small fraction of what they were paying another company for internet leads.
They asked me not to reveal exact specifics but in general car dealerships make about 1-1.5k per car on the low end that they sell.
On 600 people if they sold 10 cars then this was profitable for them. Again they asked me not to reveal exact stats (believe me I would love to) but there is a reason they are calling me every day to see if I know anyone who can do this for them full time for 100k/year or so.
I am guessing it backed out pretty good
“They asked me not to reveal exact specifics but in general car dealerships make about 1-1.5k per car on the low end that they sell. On 600 people if they sold 1 car then this was profitable for them.”
Wouldn’t 600 leads cost them $6,000?
Correct I actually meant 10… corrected!
Awesome post Shoe. Thanks for sharing the great case study.
I was wondering if you could discuss a bit more about the approach used in the creative.
It’s obvious it was a conscious decision not to highlight the fact this was a Chevy dealership (although it does say Chevrolet in the landing page creative).
You mentioned “this is why we started doing the leads for only $10″. So was your reasoning that you wanted to cast a wide net and then let the dealership further qualify the leads after you’d made your $10
? Did you tell the dealership this was going to be your approach? Did you need to clear the creative with the dealership prior to running the ads or did they just want to see the leads?
I worked for a while designing and marketing automotive websites. It’s an amazing industry.
Thanks again.
We actually did not cast a very wide net. We targeted the exact specific demographics that they provided to us.
When we do these case studies its not really for the money (which is why we only charged 10$ per lead) its more for our readers and to show how to do it. I know to a lot of people out there would think 6k/profit per month was a lot of money.
Thanks Jeremy.
I liked the post a lot, but the promo code doesn’t work.
This is really helpful information, thanks Shoe. I’d love to see you expand on it even further. For instance, how do you execute the agreement with a local business?
You’re so transparent with your deal-making, I’d love to know if you have a standard contract you use for agreements like this.
I have had a lot of requests for this kind of thing and thought about re-writing the local guide with all the questions I have gotten. I think including sample agreements would be a great addition to that.
Jeremy, I have a 3 page agreement template I’ll share if you want to add it to the updated guide. Hit me up if you want to use it, you have my email.
This would be a big help. I see the possibility with this. Any sample agreements would be great to review. Thanks for this inspirational post.
I’m looking for people that can get me into companies like this all over the country.
I have the system ready, designers, landing pages, and lead deliver software to automate all of this.
This was an excellent idea. Thanks for sharing your experience with us.
Isn’t “cash for clunkers” over?
Yup which is why we are writing about it now as a “completed” case study.
You really go after the local traffic there in Nebraska.
You do need to have some type of credibility or standing but at the end of the day it is all about presentation if you really think about it.
I love this case study and article you are the man for posting this, along with your lander and banner.
Amazing!
something similar can be done for the cash for appliances thing coming up in the fall GET READY
now, why don’t I ever think of stuff like this? It’s sitting there right in front of everybody’s faces. Yet, it takes a real entrepreneurial brain to fish the money out of these circumstances. good work!
Great case study.
What are you using on the back end to track leads and forward them to the dealership?
We don’t track the back end. We charge a low fee per lead. Its up to them to convert it. I told them we would refund them for bogus leads no problem but they were so happy with the results that we never even had to deal with that.
Is it simple to track the number of people (leads) who submit their info via the form?
Jeremy I think Rockstar was asking how you gather and deliver the leads to the dealer after the form is filled out? Is it automated to go direct to them or did you send a batches?
Great case study! Very interesting. Thanks for sharing with us.
Epic case study.
You prove yet again that there are so many opportunities out there staring us in our faces. Most of the time we just can’t see them.
LOVE LOVE LOVE this post, as well as the original local affiliate program one. Nothing like thinking outside the box…
Thanks for the case study! Very informative.
When I look at the call to action on the landing page it is terribly obvious that I would simply be handing over my contact info & that I would be receiving a call from the dealer. The site says “See if you qualify” which clearly doesn’t seem to be the intent of the site & I would expect most visitors would understand that. What sort of message would you display to the user after they submitted their info?
I guess I’m just surprised (shocked) by the conversion rate. Thanks for sharing.
shoemoney does it again, great educative blog.
Shoemoney you must be the best opportunist bar none.
Great post!
Also, it’s possible to warm up business owners through direct mail, attending local chamber of commerce meetings, etc. There are plenty of things the dedicated marketer can do to insure that he never has to make a cold call in his or her life!
Great Post and Great timing! I’m working on a similar project for a local kitchen and bath countertops company–thanks for the great ideas.
Awesome Post!
Good info, thanks shoe!
For the man with the $100,000+ AdSense check, this seems like a huge amount of effort for $6,000. How well does it scale?
How do you think he made the 100,000? It wasn’t by sitting around.
Sure it’s $6,000 now. But in a few months it may be more.
And if it’s not. Well it’s $6,000 to invest in the next big project.
Effort = money!
That guide in the shoemoney tools about this stuff has been invaluable. I am cranking away on facebook ads with it as we speak. Just popped over to take a bread.
Excellent case study, and a meaningful recipe to make some decent cash. Cashing in on Cash For Clunkers With Myspace is destined to become oif of the all time classic Shoemoney posts.
Thanks for this post, it’s really useful
I cant believe all the hype about cash for clunkers. Glad the government is helping out for once!
I think it is a good idea but the fact that they underestimated the deficit by about umm….. 2 trillion, I don’t think Obama is doing a fantastic or even slightly fantastic job. Right now I think his promises are just as lame and untrue as all the others in the past!
Awesome stuff shoe, I never thought one could earn from such a scheme. You really think out of the box.
Shoe:
800 clicks which converted to about 600+ total leads >>> NOT POSSIBLE, no one gets this conversion rate on any website. This is a joke and flat out fabrication. Never in the history of doing this for 11 years can you get this type of conversion of a quality lead. Garbage yes, quality, not way.
Besides, all that matters is if you sell it in the dealership world. I can generate 10,000 garbage leads for a dealer, if someone is going to pay $10 for garbage, they aren’t that smart. What matters is cost per sale and based on MySpace demographics today, it doesn’t add up. In the off chance this worked for Cash for Clunkers, it isn’t a model that will work long term. Where is the info on the dealers actual close rate on these leads? This should be the topic of the white paper.
Shoe is not in the business of deceiving people, I think his reputation in the industry speaks for itself. So why would he even bother refuting some random guy’s claims of ‘fabrication’.
Where did you get the idea this is supposed to be a ‘white paper’? If the quality of the leads don’t pan out then the client and marketing company can renegotiate the costs, but that type of information is not the purpose of this blog post – it’s just a demonstration of how to put local internet marketing into practice.
Mike : It might be possible that 800 clicks shall not give you 600 leads ..but on which basis you can say that no one can get this kind conversions ? If you really think it’s a joke then i must tell you that i personally own about 36 websites of cars and trucks on which around 50k unique visitor comes on daily basis and i get very high conversion for the automotive insurance & loan affiliate advertisers. How the hell can you say that this is a JOKE ?? Do you actually mean that shoe is doing all this to boost sales of Myspace ads ….??
You can not generate 10k leads for any deals no matter what is the quality. You got you understand one thing straight that no is dumb to pay per lead in this world. As far as actual close rate is concerned that is company’s look out ..damn it why hell you wanna put it things on white paper
Chris… what is your ballpark conversion rate on the 50K visitors per day?
And how do your ads to landing pages compare to the one in this example?