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August 20, 2021

Are Google Results Inflated?

Exposing the Outcomes of Google SEM Campaigns

This report explores the widespread inflation of Google Ads results in the automotive industry, uncovering that a majority of conversions are misrepresented as sales opportunities. Dealers must transition from Cost Per Lead (CPL) to Cost per Sales Opportunity (CSO) to more accurately measure the effectiveness of their advertising efforts.

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Highlights:

  • Over 67% of conversions from Google Ads are phone calls, with only 13% of those being sales-related.
  • Google-certified agencies often inflate campaign performance due to unclear definitions of conversions.
  • The auto industry must transition from Cost Per Lead (CPL) to Cost per Sales Opportunity (CSO) for better ROI.
  • Dealers can optimize their ad spend by using third-party marketplace data for higher-quality traffic.

About this release

Over the past two decades, Google Ads have become a central part of automotive digital marketing, with most dealerships heavily investing in the platform to drive sales. However, this report uncovers a critical flaw in the way ad performance is measured and reported. Many Google-certified agencies conflate various types of conversions, such as phone calls and form submissions, without differentiating their purpose—whether they are sales, service, or administrative inquiries.

As a result, dealers are led to believe their Google Ads campaigns are more successful than they are in terms of generating sales opportunities. The report calls for a shift in the industry’s approach to ad reporting and strategy. It urges auto dealers to adopt a Cost per Sales Opportunity (CSO) framework that accurately reflects whether a conversion translates into a true sales lead. The report also highlights the importance of leveraging third-party marketplace data to enhance Google Ads effectiveness and reduce wasteful spending.

What's Inside

  • Detailed analysis of Google Ads conversions in the automotive industry.
  • Case studies highlighting inflated conversion metrics and their impact on ROI.
  • A new framework for measuring true sales opportunities from ad campaigns.
  • Recommendations for using first-party data to improve Google Ads performance.

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Faqs

Many Google-certified agencies report all types of conversions—such as calls and form submissions—without distinguishing whether they lead to sales, service, or administrative outcomes, giving the false impression of a higher ROI.
CPL measures the cost of generating any type of lead, while CSO specifically measures the cost of generating a lead that results in a sales opportunity, providing a more accurate gauge of ad effectiveness.
Dealers should focus on leveraging third-party marketplace data and properly categorizing conversions to understand which ad channels truly drive sales, reducing wasteful spending on non-sales conversions.

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