How auto dealers can benchmark smarter and save more with fractional support.
If you’re like most dealers, you’ve probably asked yourself: Am I spending too much on marketing? Or not enough? The answer isn’t whether you should spend more or less. It’s about how to spend smarter.
We talk with dealers every day who are trying to cut marketing costs while still driving results. One of the first things we ask: Are you benchmarking your ad budget against industry standards? If you’re not, you might be spending inefficiently without even knowing it.
What “20 Groups” Say About Ad Budgets
In the automotive industry, a “20 group” is a peer-to-peer forum where non-competing dealerships and related businesses come together to exchange best practices, explore challenges, and learn from each other’s experiences.
Typically made up of 10–20 members, these groups aim to boost performance and profitability in the automotive retail industry.
Some 20 Groups offer guidance on advertising spend, sharing that a good rule of thumb is to spend about 6% of your sales department’s gross profit on advertising. This benchmark helps you avoid the trap of “more is better” and instead focus on what’s sustainable and profitable.
Keep in mind:
- This guideline applies only to variable operations, meaning new and used car sales, not fixed ops like service and parts.
- Franchise dealers should factor in co-op accruals. For example, if your co-op program contributes $7,000 per month, that’s $7,000 you’re not paying out of pocket. Your gross advertising budget could be as high as $20,000 a month while still staying “on budget.”
- Tools like your CRM, website platform, or inventory systems are vital, but they don’t belong in your ad budget.
- What does count? Your marketing agency, ad spend with Google or Meta, and your third-party lead providers do count as part of your ad budget.
Where Marketing Dollars Go to Waste
Too often, we see dealers locked into expensive vendor contracts or bloated ad accounts without strong returns. In many cases, there’s no strategy tying these pieces together, it’s just a pile of “stuff we’re doing.”
Here’s the hard truth: No one is watching your budget but you. Vendors are great at selling their own value, but they aren’t concerned with how they fit into your broader goals or budget guidelines.
There’s a Better Way: Fractional CMO Support
If you don’t have a full-time marketing director (or even if you do, but they’re buried in daily tasks), AutoSweet can step in with fractional CMO services. Think of it as having an experienced marketing leader, without the full-time salary.
We’ll start by analyzing your current spend and performance. Then we help you:
- Benchmark your spend against industry standards
- Reallocate dollars from underperforming vendors or campaigns
- Consolidate tools and contracts where possible
- Develop a clear monthly plan that balances volume and efficiency
- Support your team (or act as your team) to execute and adjust
In short: we help you stop wasting money and start using it more strategically.
It’s Not Just About Spending Less, It’s About Spending Right
You might be spending more than the 6% benchmark and still not seeing results. Or maybe you’re below that mark but you’re leaving volume on the table. Benchmarks give you a place to start, but what matters most is understanding how every dollar you spend is working toward your sales goals.
We wrote more about this in our blog How Much Should Dealers Spend on Marketing?—but here’s the bottom line: when marketing feels chaotic or expensive, it’s usually because there’s no clear strategy guiding the spend.
Let’s Take a Look Together
Not sure where to start? That’s where we come in. At AutoSweet, we specialize in working with dealers to clean up their digital marketing, identify cost savings, and focus on what drives actual leads and sales.
We’ll show you how your marketing investment compares to industry standards and help you build a plan that makes your dollars work harder. No fluff. Just results.
Ready to trim the fat and keep the horsepower?
Let’s talk. Our fractional CMO services are designed to help dealers spend smarter—not just less.
Our seasoned professionals can drive your strategic growth initiatives while maximizing resources. Whether you’re looking to elevate your brand presence, generate leads, or improve your marketing ROI, we’re here to partner with you.
In it, you’ll find a comprehensive review of the costs associated with a full marketing team vs. a fractional CMO solution.
Want to discuss a fractional CMO solution for your dealership? Reach out to speak with one of our marketing consultants today to find out how we can analyze your marketing spend and support your growth with this innovative solution.
