A slow start to 2017

Despite a big push from the recent election and even stocks in the transportation sector doing well, auto transport is lingering a bit so far. When this happens companies tend to get scared and drop lead providers or the amount of leads they get. My biggest advice is keep with it (if you can) because all those customers will eventually ship their cars and your posted orders will eventually dispatch.

Weather is the number one factor this time of year and it (as always) is unpredictable. Hang in their because I belive 2017 will be the strongest year in the last decade.

Why PayPerClick (PPC) does not Pay for brokers?

So you want to try PayPerClick (PPC).

pay-per-click

noun

1. (on the Internet) a strategic business model where companies place an advertisement on their site pays a sum of money to the host website when a user clicks on said advertisement.

Lets break it down for brokers in 4 factors.

1. Cost per "key word" 

Costs can range substantially any where from $12-$15 per click for a key word that is competitive such as "auto transport" to $5-$10 per click for a longer tailed keywords with less traffic and impressions. The key here is LESS, a lot less, so its not Realistic to believe you will get tons of clicks at $5-$8 even if you set your daily budget to the moon.

2. Experience.

Google has certain algorithms to extrapolate as much money as possible from new companies and individuals with newer accounts. I recently set up my 3rd managed account and remember we did not break even on cost until we paid over $50,000 through the account. So if you don't have $50k-$100k to play with I would be very careful.

3. Conversion (Lead)

One of the biggest things is your conversion rate, basically how many "clicks" it takes to aquire a real lead. Most sites I see brokers using are poor at best. In fact, a recent study claims that the average lead converting site performs at 20%. This would mean it would take about 9 clicks to get a lead. Times that by $8.00 (conservatively speaking) and that is $40.00 for anyone starting out. 

4. Conversion (Sale)

Now how many leads must you generate to get an actual sale. Say you close these exclusive leads at 33.33% . That would mean you would have to spend $120.00 as your CAC (Customer Acquisition Cost) Then pay a sales commission of lets say 30%, again conservatively speaking, to your sales rep. Even if you closed the deal at $200.00 which is on the high side, the company would make $20.00.

Conclusion

Believe it or not, many of my numbers above are fair and conservative. The main reason why it doesn't work out so well for brokers is because the majority of consumers like to get multiple prices online. so even after you spend all this money getting a actual lead, that customer shops on other sites and gets multiple quotes from other companies as well. The best bet is still aggressive sales reps and a good quality lead source(s).

Things are looking up!

Do you think 2017 will bring a better season and overall a better year?

Yes, With the recent positive market fluctuations due to the new incoming president I believe 2017 will be a strong overall year. 2016 brought too much uncertainty and was very flat to say the least. Election years have always proven (as of recent) to prove strong, solid growth in many sectors.

 

Industry Experiences a weak summer season...

Industry Experiences a weak summer season...

Central dispatch listings at an all time low.

Fluctuating in the low 20k's, Centraldispatch.com, The monopoly of all load boards is at a 3 year low, some will blame a slower than normal car sales market due to ride-sharing platforms such as uber and lyft. If the growth trend for ride-sharing keeps continuing as it has been, we are all in some deep trouble.

Do Snowbirds still exist?

Of course, but again, with a soft car market and Uber around, Why does granny need a car when she gets to florida? She can simply hitch a low cost ride, you do the math:

1.) Transport car to and from florida: $1400
2.) gas / parking / maintenance while in Florida for 5 months: $600

That's two grand, My grandparents could spend $300.00 a month on Uber and and be well under that number, not to mention riding in style. We may see our beloved snowbird routes fizzle out in the next year or so. HINT: Its already happening.

So whats left?

Well, lets see... IT'S NOT GOOD! We have pretty much have taken our bread and butter out, so the occasional specialty car move or military relocation.... Again, not looking good.

Whats Next?

Autonomous cars, the death of car sales and most transport as we know it. Autonomous trucks carrying autonomous cars, check out this 30K retrofit: https://www.wired.com/2016/05/otto-retrofit-autonomous-self-driving-trucks/

I'm sure when perfected (and legal) carriers will be buying these things up like candy, at least prices will go even lower to transport what we got left.

AUTO TRANSPORT APPS

Auto Transport Apps, The future, or a nightmare you can't even begin to imagine...

In this day an age one would expect their to be a plethora of car shipping apps similar to uber and lyft except for consumers that need to ship vehicles. While this technology has already arrived already in the freight shipping sector, it has yet come to ours. Companies such as Convoy and Cargomatic have jumped into this both claiming that they are the "uber" of freight shipping. One can only assume this means auto transport is next.

Not So Fast.

Not so easy though, this requires money, not the kind of money that daddy gave you to open your brokerage, real money. The kind of money to hire a real (non commissioned) work staff. Then advertising, lots of it, I'm talking top of google money to get the word out, it would be 10 to 100 times more capital then uber to get the word out. This industry is not so "word of mouth" as ride sharing apps. so you can imagine that we got a while to go but the basic apps and infrastructure is in place already.

TIP FOR JUNE 2016

One helpful tip I can recommend for you is to make sure that your office number (800) is in your metatag, this will increase your monthly website calls by 200%. An old friend of mine shared that tip with me many years ago.

Industry Update

It would appear that the broker boom of 2011 is all but gone, you just done see an influx of car shipping companies like you have in days past. The larger ones remain and the smaller ones seem to eek by. 1-2 man owner/sales reps have recently proved to be a popular business model due to rising overhead.

Some companies buy leads, some use Uship and a few try to market small car dealerships. I know one thing, right now does not seem like a good time to open one of these businesses. Lead prices will continue to rise and smaller companies will trickle away slowly but the big 20 will remain, hammering it out day by day.