New Google Policy: Transparency From Marketing Vendors

New regulations by Google are aimed at making providers of 3rd party leads more transparent than ever. According to an official Google posting, 3rd party lead providers are now required to show clients how their ad budget is being used. It’s not a request from Google, it’s a requirement effective this month. For example, if a dealer spends $5,000 per month for 3rd party Pay-Per-Click Services, how much of that monthly is going towards their campaign verses expenses. The official Google posting on this subject reads, “At a minimum, you must provide your customers with monthly performance reports that include data on costs, clicks, and impressions at the Google advertising account level. When sharing Google advertising cost data with customers, report the exact amount charged by Google, exclusive of any fees that you charge.” Those fees may include so-called “Management Fees,” which typically go to the advertiser, not lead generation. The official Google policy indicates that 3rd party lead providers must: “At a minimum, inform new customers in writing (of management fees) before each first sale and disclose the existence of this fee on customer invoices.”

What is going to happen as these companies are required to be more transparent? Will there be pushback? Could some dealers start to follow the AutoNation lead? Mike Jackson, the CEO of AutoNation told the Automotive News in April that his stores would work with 3rdparty lead providers, as long as their pricing is acceptable. “We’re definitely not pulling the plug,” Jackson said. “You give me more attractive pricing and we’ll do business for a long time, you jack the rates, I have attractive alternatives.”

The regulations rules from Google are intended to help businesses such as dealerships know if they are getting that attractive pricing referenced by Mike Jackson. The rules also indicate that if 3rd party lead providers violate the new terms outlined by Google, they could face suspension or termination of their account and relationship with Google. Do these changes impact you? Are you planning on contacting your lead provider about this change? Do you think these rules are necessary?