13/01/2023 - 15 minute read

How to generate finance leads for a car dealership using Facebook Ads: Advanced tutorial with examples

A profile picture of Gary Lewis Cheetham, the founder of GL Digital Automotive Marketing, smiling outside a car dealership

Written by

Gary Lewis Cheetham

Automotive marketing specialist from Manchester, UK

A header image for the blog post How to generate finance leads for a car dealership using Facebook Ads: Advanced tutorial with examples from GL Digital Automotive Marketing

Table of Contents

This article will provide a comprehensive guide for car dealerships on how to use Facebook ads to generate finance leads, with examples and case studies from the dealerships we work with at GL Digital.

Warning: This is an advanced article including detailed technical concepts. You must have a strong understanding of Facebook ads and paid social advertising to utilise the methods in this article.

Generating finance leads using Facebook ads is a complex method for dealerships that already have a strong social advertising strategy in place.

What is covered in this article?

The article will cover topics such as creating an effective ad campaign, targeting options, building a landing page, tracking and optimizing results, with examples of each step.

The article will also include best practices for lead generation and tips for A/B testing to improve results. By the end of the article, readers will have a thorough understanding of how to use Facebook ads to increase finance leads for their car dealership.

What are finance leads for a car dealership?

Finance leads for a car dealership refer to potential customers who have expressed interest in financing options for purchasing a vehicle.

These leads typically provide contact information and have shown an interest in the dealership's financing options by taking actions such as filling out a financing application or request form, visiting a landing page on the dealership's website, or requesting more information about financing options through a phone call or email.

Finance leads enable you to perform a credit check on a customer and ultimately sign them up for a loan.

These leads are valuable for the dealership, as they represent individuals who are actively considering purchasing a vehicle and who may be more likely to do so with the right financing options. The dealership can then use these leads to try to close sales and start building a relationship with their potential customers.

Before we continue, who wrote the article "How to generate finance leads for a car dealership using Facebook Ads: A complete guide with examples"?

I am Gary Lewis Cheetham, an automotive marketing specialist with over 10 years of experience, born and raised in Oldham, Greater Manchester, UK.

I have a proven track record in running a successful vehicle finance brokerage. My background in marketing and knowledge of the car industry, coupled with my marketing expertise, has helped me to excel in utilizing Facebook Ads to generate finance leads, both for my brokerage and for other independent dealerships.

I am the founder of GL Digital Automotive Marketing, a company I started in 2020, to bring my expertise to independent dealers in the UK and US, with the goal of helping them realize their full potential by utilising Facebook Ads.

My passion for the car trade and understanding of the industry helps me to deliver effective solutions and drive results for my clients. I am constantly seeking to improve my strategies and help dealerships to succeed in their marketing efforts.

Why is generating finance leads important for car dealerships?

Generating finance leads is an essential part of the car dealership business because it allows dealers to increase their revenue and build good relationships with lenders and finance companies.

First of all, finance leads give dealerships the potential to make finance commission off of each sale, which can be significantly more profitable than just selling the cars alone for cash.

Furthermore, maintaining a good relationship with lenders is important for a car dealership as you generally have a stocking loan (floor plan in the US), so the more deals you do the more willing your finance company or bank will be to lend you money to buy stock.

Getting more finance deals approved will make your finance rep happy, and keep your dealership on the lender's good side!

What are the drawbacks of using Facebook ads to generate finance leads for your dealership?

Using Facebook ads to generate finance leads for a car dealership can be an effective way to increase sales, but it is only effective if the dealership has enough cars in stock that match the preferences of their potential customers.

When a customer expresses interest in financing a vehicle by filling out a credit application or request form, visiting a landing page on the dealership's website, or requesting more information about finance options through a phone call or email, they expect to find a car that they like. If the dealership doesn't have a car that matches the customer's preferences or if the car is not readily available, the customer may lose interest or go to another dealership and purchase a car.

Furthermore, even if the customer is approved for financing and is interested in purchasing a car, they may change their mind if they don't find a car they like or if they feel like they have to settle for something less than what they wanted. This can make them less likely to return to the dealership for future purchases.

Therefore, it is important for the dealership to ensure that they have a variety of cars in stock that match the preferences of their target market and that these cars are readily available for customers to test drive and purchase. This increases the chances of converting finance leads into actual sales. The dealership should also make sure that their stock list is regularly updated, to give the customers a wide range of cars to choose from.

Introduction to the different types of Facebook ad formats and their respective use cases for generating finance leads

When generating finance leads, there are two types of Facebook ads that are particularly relevant: Vehicle Catalog Ads and Video Ads.

You should choose one type of ad format when you follow this tutorial, depending on whether you have a Facebook catalog set up already in commerce manager.

About using Vehicle catalog ads to generate finance leads

Vehicle Catalog Ads allow car dealerships to showcase their inventory of vehicles in a visually appealing way. By uploading a catalog of vehicles to Facebook, dealerships can create dynamic ads that automatically show different vehicles based on the viewer's interests and browsing history.

These ads can also include a call-to-action button that leads the viewer to a landing page where they can learn more about the vehicle and financing options.

To create a Vehicle Catalog Ad, the dealership needs to have a Facebook Catalog set up, this catalog is a database that contains all the information about the vehicles, such as the make, model, year, and pricing.

Looking for a complete guide to vehicle catalog ads on Facebook? Check our Ultimate Guide to Facebook Catalog Ads for Car Dealers here.

At GL Digital we use a web scraper to scrape our client's websites, and to generate the catalog which is then automatically uploaded to the Facebook commerce manager.

Once the catalog is set up, the dealership can create dynamic ads that feature multiple vehicles and targeting options to reach the right audience.

About using Video ads to generate finance leads

Video Ads are another effective way for car dealerships to generate finance leads.

We don't recommend that our dealerships run video ads highlighting particular units they have in stock.

Instead, we recommend our dealers use customer testimonial videos, or selfie videos of their salesmen talking about their finance offers.

Video ads can be used to highlight the benefits of the dealership's financing options, such as low interest rates, flexible terms, and special offers.

To create a video ad, the dealership needs to have a video that showcases the financing options, or a customer testimonial.

Facebook allows video ads to be as short as 6 secs, but ideally 30 secs to 1 min to include all the details. Once the video is ready, the dealership can choose to target specific demographics, interests, behaviours, and more, to reach the right audience.

What are the steps to Create a Facebook Ad Campaign to generate finance leads for a car dealership?

Creating a Facebook ad campaign to generate finance leads is a process that involves several steps. Here's a brief overview of the steps that should be taken:

  • Set up a landing page or "Form on Facebook"
  • Choose an ad format (Vehicle Catalog Ads or Video Ads)
  • Set special ad category
  • Write ad copy and create visuals
  • Target the right audience
  • Set a budget and bid
  • Track and optimize
  • Create a retargeting campaign
  • Monitor and Refine

How to Set up a landing page or Form to Generate Finance Leads with Facebook ads

A landing page is a website that users click through to when they interact with your ads.

A car dealership must ensure that their landing page and form are well designed, fast-loading, and include all the fields that are necessary to conduct a credit check on a customer, and therefore increase the chances of closing a sale.

What customer information should be collected for a finance lead?

When collecting customer data to perform a credit check when getting finance leads on a vehicle, there are several aspects of the customer's information that should be collected:

  1. Personal identification: This includes the customer's full name, address, phone number, and date of birth. This information is used to verify the customer's identity and to check their credit history.

  2. Employment information: This includes the customer's current job title, employer's name, and length of employment. This information is used to determine the customer's income and to assess their ability to make payments on a loan.

  3. Financial information: This includes the customer's current income, whether they own a home or not. This information is used to assess the customer's overall financial situation and to determine their creditworthiness.

  4. Vehicle information: This includes the make, model, and year of the vehicle the customer is interested in financing, along with the deposit amount or part ex details, if any and the terms of the loan the customer is applying for.

  5. Co-signer information: If the customer is applying for financing with a co-signer, their personal identification, employment information, and financial information should be collected as well.

By collecting this information, a car dealership can perform a credit check on the customer and assess their ability to make payments on a loan.

Different landing page and form options you can consider to collect finance leads from Facebook ads

There are multiple types of form you can use as a landing page for your Facebook ads when generating finance leads.

Some options are self-hosted (meaning you pay your own developers to design and host them), or provided as part of a SaaS (software as a service) product which you pay monthly for.

At GL Digital, we outfit clients with a custom self-hosted landing page and an AI chatbot-style form to collect finance leads.

For a Self-hosted landing page option, you can create a page and form on your dealership's website.

Your website provider (e.g ClickDealer) may already have a finance application form embedded on your website.

If you self-host your landing page you can include innovative features such as finance calculators which give quotes in real time.

You could also check to see if your finance company provide a form you can use. Some finance companies (such as MotoNovo) provide pre-built form options that you can either embed on your website as an iframe, or send customers to directly from your ads.

For SaaS options we recommend Typeform, which is an online form builder software.

You can also use Form on Facebook to generate your Finance leads. Form on Facebook is a form builder hosted on Facebook, and it comes with the advantage of pre-filling customer data such as Name, Phone Number and Email Address. This can save your customers time when filling out your form.

How to ensure your terms and conditions and data processing policy are up to date before collecting customer info

When processing customer data, especially when performing credit checks, you must ensure that you comply with all local regulations such as UK GDPR.

Never perform a credit check on a customer without collecting explicit opt-in permission e.g via a check box which is unchecked by default.

Consult with a legal professional before you collect any customer data to make sure you are compliant.

How to choose your ad format to collect finance leads from Facebook ads (Vehicle Catalogue ad or Video ad)

If you have a Facebook vehicle catalogue already set up for your stock feed, then I recommend using vehicle catalogue ads.

Vehicle catalogue ads may get lower engagement than a video ad, but the leads will have more purchase intent, because the customer will come through already attached to a vehicle.

If you have a good customer testimonial video then I recommend using this in your ads. A testimonial is very powerful and a video will likely get higher reach and engagement on the Facebook platform.

Otherwise, you should have one of your salesmen create a selfie video explaining your finance options to the camera.

Selfie videos provide an effective and authentic way for customers to connect with the dealership and its personnel, as it adds a personal touch and builds trust.

How to set up the finance lead generation ads in the business manager, step by step

Here is a step by step guide showing how to create the ads in your Facebook business manager, as of January 2023.

First of all, log into your business manager at https://business.facebook.com and open up your ad account.

Step 1: Campaign Set Up

A screenshot of the green create button from a facebook ad manager

Click the green "create" button at the top left of the table showing your active ads

A screenshot of different campaign types creation dialogue in Facebook business manager

Then select the campaign objective "Lead" in the popup that appears

For your Campaign name and Ad Set Name choose what you want, this is only for your own reference

A screenshot of a new campaign being created in Facebook ads manager

Ensure you choose the special ad category "credit" under Special Ad Categories.

Image of the advanced campaign option being switched to on in a faebook ad campaign

Leave A/B test off and select "Advanced Campaign Budget" as on.

Set a daily budget as required. We recommend not running ads for lower than \$30 per day.

Step 2: Ad Set Setup

A screenshot the ad set setup screen in Facebook ads manager

Under Conversion location, choose "Website" if you are using a self-hosted form, or form on your website. If you choose "Website" set your conversion action to Lead.

Choose "Instant Forms" if you would like to use the Form on Facebook form builder option. Check earlier in the article to see a comparison of both options.

A screenshot of the ad set setup screen showing facebook page selection in Facebook ads manager

Select a Facebook page to advertise under (usually your dealership's Facebook page)

If you are using a video in your ad, select dynamic creative.

If you are using a Facebook Vehicle Catalogue, do not select dynamic creative. This option will not work with a catalogue (as of January 2023)

A screenshot of the audience setup screen in Facebook ads manager

Under audience. leave all detailed targeting options blank. Since the ios14.5 update, broad targeting options tend to work better.

Under Locations, choose your dealership on the map +40 to 60km. This is where the majority of your customers will be located.

A screenshot of the the different ad placement options Facebook ads manager

Under placements choose "Manual Placements" and untick "Audience Network" and "Messenger"

Step 3: Set up the ad creative

A screenshot of ad options screen in Facebook ads manager

Here is where you can set up the video option or vehicle catalogue option.

If you are using a video, select Manual Upload.

If you are using a vehicle catalogue, select catalogue and choose the catalogue with your vehicle upload.

Then you can add your ad copy. Once you have finished, hit publish and your ads should go live within 48 hours.

A screenshot of a finished finance ad in facebook ads manager

This is an example of a finished catalog ad that we launched to target finance leads. You can see how the ad copy, and advertising monthly pricing rather than cash pricing all play into the finance aspect of the ad.

Guidelines for creating effective ad copy

When creating ad copy for finance lead ads on Facebook, there are several guidelines that can help make the ad copy more effective:

  1. Emphasise your local credentials: Customers often prefer to deal with local car dealerships as they benefit from more personalised service and easier access to maintenance and repairs.
  2. Include a clear call-to-action: The ad should include a clear call-to-action, such as "Apply for financing" or "Learn more about our financing options" to encourage viewers to take the next step.
  3. Use numbers and statistics: Use numbers and statistics to support the ad's claims and demonstrate the value of the financing options.
  4. Use active voice: Use active voice to make the ad copy more engaging and encourage viewer's to take action.
  5. Keep it short and simple: Facebook ads have limited space and ad copy should be short and simple, making it easy for viewers to read and understand.
  6. Stay compliant and include your FCA disclosure and representative example: This must include your trading name, company name and FCA number to be compliant with UK trading regulations (other countries may differ)

High-performing finance lead ad copy example from ads we have launched at GL Digital

Looking to finance a car? Well we've got exactly what you're after, just pick a car, car your payment method and drive away. It's that simple!

No obligation - pass all the checks and get accepted but change your mind at the last minute? No problem!

Apply now and don't worry about committing, talk to one of our friendly advisers and they'll help you through the whole process.

Why not apply today?

.

Representative example: borrowing £3,000 over 36 Months with a representative APR of 33.2%, the amount payable would be £125.74 a month, with a total cost of credit of £1,526.64 and a total amount payable of £4,526.64

How to track and optimise your finance lead results on Facebook ads

Once your campaign is launched, your work is not done.

When running a finance lead generation campaign on Facebook Ads, it's important to track several key metrics to evaluate the campaign's performance and make adjustments as needed. Here are some of the most important metrics to track in the UK market:

  1. Cost per lead (CPL): This metric measures the cost of acquiring a single lead and it's usually expressed in GBP. A low CPL indicates that the campaign is generating leads at a low cost and is considered to be cost-effective.
  2. Click-through rate (CTR): The number of clicks on the ad divided by the number of impressions. A high CTR indicates that the ad is resonating with the target audience.
  3. Conversion rate: This metric measures the percentage of users who complete the lead form out of the total number of users who visited the landing page. A high conversion rate indicates that the campaign is effectively converting users into leads.
  4. Credit acceptance rate: This metric measures how many of the leads were acquired, and were accepted for credit from one of your lenders.
  5. Purchase rate: This metric measures the percentage % of customers who purchased a vehicle after being accepted for credit from one of your ads.
    By tracking these metrics, the dealership can evaluate the campaign's performance and make adjustments as needed to optimize the campaign for better results.

These metrics will provide a good indication of the campaign's performance, how effectively the ads are working, and how much it is costing to generate a lead.

What results can be expected as a benchmark

See below for a benchmark results from our testing with clients at GL Digital

When running video ads, we generally see leads come through for between £3 and £12 per lead, on average.

When running Vehicle catalog ads, we see finance leads come through for between £15 and £50 per lead, on average.

Leads from Vehicle catalog ads are usually easier for salesmen to convert because they come pre-attached to a vehicle.

Good credit customers vs bad credit customers, how to target each audience segment

Depending on which lenders are on your panel, you may be more interested in customers who have good credit. Or, you may be able to convert more customers who have bad credit and sell them vehicles.

This depends on the dealership, and what your price range of vehicles is, but here are some options depending on your situation:

How to attract customers with bad credit

Customers with bad credit may have been rejected for finance in the page due to defaults or CCJs.

Attracting customers with bad credit to click on an ad can be challenging, but there are a few ways to make the ad more appealing to this audience:

  1. Highlight the dealership's special financing options: Customers with bad credit may be more likely to click on an ad that highlights the dealership's special financing options, such as bad credit financing, second-chance financing, or subprime financing.
  1. Use persuasive language: Use persuasive language in the ad copy that highlights the benefits of the dealership's financing options and reassures customers that they can get approved despite their credit situation.
  1. Use testimonials from other customers with bad credit: Including testimonials from other customers with bad credit in the ad can help to build trust and credibility with this audience.
  1. Include a clear call-to-action: The ad should include a clear call-to-action, such as "Apply for financing" or "Get approved today", to encourage viewers to take the next step.

How to attract customers with good credit

Attracting customers with good credit to click on an ad can be a bit different than customers with bad credit, as they may have more options and could be more discerning in their choices.

Here are some ways to make the ad more appealing to customers with good credit:

  1. Highlight low-interest rates: Customers with good credit may be more interested in low-interest rates, or even 0% finance deals. So, highlighting the dealership's low-interest rates in the ad can make it more appealing to this audience.
  2. Use persuasive language: Use persuasive language in the ad copy that highlights the benefits of the dealership's financing options, such as lower payments or shorter terms.
  3. Use testimonials from other customers with good credit: Including testimonials from other customers with good credit in the ad can help to build trust and credibility with this audience.
  4. Highlight the dealership's reputation: If the dealership has a good reputation and positive online reviews, you could include that in the ad, highlighting their quality of service and trustworthiness.
  5. Highlight luxury or premium vehicles: If the dealership has luxury or premium vehicles in its inventory, highlighting them in the ad can be a way to attract customers with good credit, as they may be more inclined to purchase a high-end vehicle.
    By using these strategies, a dealership can make their ad more appealing to customers with good credit and increase the chances of attracting them to click on the ad.

Conclusion of the article "How to generate finance leads for a car dealership using Facebook Ads: Advanced tutorial with examples"

In conclusion, Facebook ads are one of the most powerful tools for generating finance leads for a car dealership.

By setting clear objectives for the campaign, choosing the right ad format, targeting the right audience, and creating an effective landing page or form, a dealership can generate leads at a low cost and increase the chances of closing a sale.

Additionally, by appealing to customers with bad credit and good credit with specific messaging, can help increase the chances of them clicking on the ad. Monitoring the campaign's performance and making adjustments as needed, is key to optimizing it for better results.

However, it's important to remember to comply with all regulations, like the laws of discrimination, when targeting a specific audience and running ads. Facebook ads can be a valuable addition to a dealership's marketing strategy, as long as they are done in a smart and ethical way.

Note: The above is an overall guide, It's better to seek legal, financial and professional advice to make sure your ads & campaign run smoothly.

About the author

A profile picture of Gary Lewis Cheetham, the founder of GL Digital Automotive Marketing, smiling outside a car dealership

Gary Lewis Cheetham is an automotive marketing specialist, born and raised in Oldham, Greater Manchester. Gary Lewis Cheetham is the founder of GL Digital Automotive Marketing. He spent his teenage years working at the family dealership after school, learning the ropes of the car trade from the inside out.

After moving on to working in marketing, Gary Lewis founded GL Digital in 2020 when he noticed a need for direct-to-consumer marketing platforms within the auto industry. He now strives every day to help independent dealers in the UK and US realise their potential. Gary also loves Formula 1 and motorsport.

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