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Automotive advertising on the Internet tied to online transactions will change the role of the "brick and mortar" auto dealership forever.

What do technology, the Internet and online transactional tools like Ai Dealer's "self serve" desking application, NeoSynergy's "Buy Direct" and DealMaker.Com's real time bidding system that allows auto dealers to compete for the deal in an open forum have to do with automotive advertising and the evolution of the brick and mortar dealership? Everything!

DealMaker, for example, stores vast databases of every variation of every vehicle available; plus a nationwide database of dealer inventory. The data is continuously uploaded to major search engines. Buyers searching the Internet can then find the exact specification they require, and in just 3 clicks they can place an order, or bid the market with complete anonynimity.

DealMaker provides a Real-time Trading Platform where Buyers and Sellers can buy and sell immediately with no loss of momentum. All bids and offers can be seen by the whole market, so the best deals close first. All terms can be negotiated in the same transaction process, so there are no loose ends. Parties communicate directly to implement delivery, so there are no misunderstandings. The bottom line is that sales can be negotiated and consummated in real time on a virtual showroom with no high pressure sales tactics or misunderstandings to prevent a mutually acceptable transaction.

The low cost and extensive reach of the Internet can create a unique and compelling opportunity to slash the cost of sales which will go directly to the bottom line for auto dealers. Online marketing by manufacturers, dealers, and sales prospecting websites have grown exponentially over the past few years because consumers are looking for a more convenient way to shop for an automobile. Auto dealers have more aged inventory to sell than ever but matching available inventory to consumer demand is still a difficult and time consuming process. DealMaker is the real-time matching engine that turns search results into sales and the ability to accommodate an online transaction can finally be achieved.

Statistically, 80% of new car buyers now use the Internet as their primary source of information when shopping for a new automobile. Additionally, 20% of these buyers declare that they are likely or very likely to buy their next new car online. A further 51% indicate varying degrees of the same. Only 29% say they are not yet ready to buy online. These are reliable conclusions consistent with a number of comprehensive surveys conducted over the past 10 years by some of the world’s largest and most respected automobile industry advisors. It takes very special technology to negotiate sales of automobiles over the Internet, and DealMaker invented it.

Another extremely progressive application, Ai Dealer, allows an online customer to "desk their own deal" after reviewing all of the information they need to make a buying decision. Once the vehicle, price, downpayment, trade value, financing terms and payments are established the customer can make their offer online. If it is accepted by the dealer, they can take delivery at the dealership with little or no need for a salesperson.

NeoSynergy allows a customer to pick a car, make an offer and submit a deposit to hold the vehicle. Linked applications like LeadConverter can establish a dialogue on the virtual showroom that escalates the negotiations, if needed, to a delivery in the real world showroom.

Internet shopping patterns coupled with applications like those above - and many more in development - will allow an online transaction that places the future of the “brick and mortar” dealership at risk. At the very least, its role in the selling process must change as Internet technologies and applied automotive advertising applications mature. Huge investments in real estate, facilities and support staff are hard to justify when a virtual showroom can provide all of the information that a car shopper needs to make a decision for a fraction of the fixed expenses and variable operating costs of a real world auto dealership.

Established wisdoms shared in the auto industry support the need for a real world service center and even a staging area for test drives but the initial shopping experience has already moved online with 85% plus of today’s car shoppers using the internet to first select a vehicle and then select an auto dealer to buy and service it from.

DealMaker.Com, Ai Dealer, Neosynergy and applications like them - present and pending - are introducing cutting edge automotive advertising applications that will allow a virtual showroom to accommodate an online transaction with efficiencies superior to the real world selling process for both the buyer and the seller. The Internet has changed the automotive advertising industry and it is preparing to change the retail auto industry with the ability to replicate proven selling processes online that integrate seamlessly into established real world processes.

The search for an online transaction tool has reached critical mass due to shrinking margins in new and used car sales with increasing costs for auto dealers that are struggling to survive in a down market. Online transaction tools are positioned to take advantage of a clearly defined need in the retail auto industry.

No need to quit your day job as a salesperson or auto dealer just yet, as long as you join the internet and technology revolution as a willing participant. The only constant in the auto industry is change, so get ready to change or get out of the buisiness!

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Replies to This ADM Discussion

What else can we say. Phil certainly has his finger on the pulse.

We do however take great pains to acknowledge that the average new car shopping process takes more than 6 months. During this period a number of different channels come into play. Not least of all the traditional car dealers who provide demos, the final sales contract, delivery and after sales service. DealMaker has not yet invented any way to move these important services into cyberspace. Our primary mission is to provide a more efficient deal-making process for new car dealers. A win-win free market model for all sides.
I would like to say that you can never replace a salesperson. It still takes a salesperson to sell the vehicle, we get wrapped up in all the techo stuff and that is great, but we need to keep focused on what is really important and that is driving traffic to the online web store and converting the consumer to a lead and Phil I believe that is what all this is about Converting Consumers. I have to say that if we had a way to shake hands with 70% of the people that visit a website you would be a rock star. You could keep the whole dealership busy 14 hours a day if this could be accomplished. Phil keep up the great work as it is always great to see what you uncover next.
Absolutely! People like doing business with people and processes won't police themselves! It is the role of the people that technology will replace - not the human being! I probably should have started my forum the way that I ended it -

No need to quit your day job as a salesperson or auto dealer just yet, as long as you join the internet and technology revolution as a willing participant. The only constant in the auto industry is change, so get ready to change or get out of the buisiness!
Salespeople are part of the plan - they just need to get with the program and improve their computer and technical skills to increase their value to the dealer and the consumer to connect the dots.
Frank; I don't want to do away with car sales people, but I do want to help some of them become professional traders. Professional traders can live very well, and in my experience they also have much more fun.

Excuse the jargon for a moment but DealMaker creates "a human grid of spontaneous market intelligence". A bit of a mouthful yes, but think about it for a moment. Its not a machine replacing real people. It merely enables a much faster and more efficient communication process. Without millions of real people DealMaker cannot exist.
Hello Brian

I understand and believe me if you can drive more consumers and have a higher conversion and closing ratio it matters not what you want to all it except rock on.
Looking at both of the technologies that you are discussing here, I see a couple of things that interest me. First would be Dealermaker.com. Ford has been working on a system that will take a Customer through a deal from start to finish all online. It is a system they have rolled out in the UK if I am not mistaken. I have been considering a couple of things since I saw this article from them. As it is right now, we can do almost every part of a deal online. Most of what we need to do so is just in a couple of different places on our Website. We have the Credit Application; consumers can build and price a vehicle on our Site or choose an existing vehicle to get a quote on. In our Department we have a Manager who actually desks deals for us. So we send an e-pencil to a Customer that wants to go that far online and will not simply come in to the Dealership to finish the Deal. So in essence we do almost everything right now, except for the Delivery of the vehicle.

With ever growing Consumer expectations on just what they can do online, we are running into more that want everything done before they arrive. We don't push Consumers this way, but the ones that do not want to come in till the last minute, get this treatment. I did a lot of research on what Consumers are looking for out of the Car Dealer and more and more do want this ability. I try and keep our Dealership on the pulse of the Consumer and the cutting edge of technology and this seems to be a topic that is coming up over and over again. I am working on a page for our website that a Consumer can do everything but take possession of the vehicle, right now. I do believe this will be the future of the Internet Sales, but I do also acknowledge that I hate to see this. The face to face interaction with our Consumers is vital.

What I am trying to do is strike a balance and give Consumers that visit our Website as many choices that I can. So for those that want to simply click on a vehicle, get a quote, insure a vehicle is in stock, and then come in to negotiate.. They have that choice. But for those who want everything done prior to coming in to our Brick and Mortar dealership... I would like to provide a service that exceeds their expectations and puts Gaudin Ford at the top of their list, when it comes to purchasing a New or Pre-owned Vehicle.

For me it is all about finding Applications, Creating Processes that will try and convert every type of Consumer that visits our site. Even if there is only 5% of my visitors that want to be able to do this, having something in place that will enable us to accommodate them would be a worth while addition in my eyes. Don't know if Dealer.com is the answer, would need to work with a DEMO in order to see what it truly is capable of, but I am working on a solution for this.
Its great to see guys who can keep an open mind and think outside the box.

When considering DealMaker it might be slightly misleading to think of it simply as a "negotiation tool". Of course it contains many different tools, but it is a trading exchange. A giant marketplace where you can buy or sell every, make, model and version on the planet. (Currently it has over 65 different brands available for trading with over 6,000 different versions and many millions of options spread between them). See http://dealmaker.com Click New Car Showroom and get your offer into the market in just 3 clicks. (We won't hold you to it)

The important difference between a free market and a closed market is the number of players. A car dealer negotiates one-to-one. A car auction or eBay negotiates one-to-many, but a true free market has many buyers and many sellers all participating in the same game. A bit like the ancient Grand Bazaar in Instanbul. This is how every stock market works AND how DealMaker works. It is quite simply the nearest thing to a perfect free market available.

Although it may be comforting for Digital Dealers to talk about replicating the dealership experience online we don't believe that is the best solution at all. Most consumers say they enjoy the dealership experience just slightly more than the dentist. In fact, as an ex new car distributor myself and ex OEM executive (my CEO) we don't understand why anyone would want to replicate the old auto dealership model in the 21st century. The risk-reward ratio and ROI is diabolical.

Our mission is all about building a better business model for dealers. Are you after a lifestyle or a business. Forget all that eyeball to eyeball stuff. Its all in the mind. I did that personal touch for 25 years with Ferrari, Maserati and Lamborghini. The world has changed. If you want to make serious money in the 21st century you better get on line.
Hi David,

Your reply was extremelly focused on both the problem and the solution - very impressive! I would love to interview you to discuss your established best practices on our blog talk radio program - Dealer Spotlight on www.adagencyonline.net - next week and I invite all of the ADM members that were equally impressed with your established processes to join us! We could even call Brian from DealMaker.Com in London to offer that demo that you suggested. After all - what are firends for!
HOFFMAN ESTATES, Ill. — The Dealer Services Group of Automatic Data Processing, Inc. (NYSE: ADP) today announced the introduction of ADP's Business Online suite of solutions. One optional component of ADP's Business Online, ADP's Buy Online enables dealerships to offer an online vehicle purchase process to web consumers. "We realized it's becoming a competitive necessity for dealers to be able to offer a complete and accurate online experience to consumers, including the ability to purchase vehicles.
ADP's Buy Online supports an efficient, satisfying customer-driven sales process and lets dealers provide the same experience to online consumers as they offer to their customers in the physical dealership," said Steve Anenen, President of ADP Dealer Services. "Consumers can either purchase their vehicle online or begin the process on the Internet and take delivery at the dealership, whichever way they prefer."

With Buy Online, consumers gain the convenience and the dealer maintains control of the sales process. And accuracy is assured with real-time integration to the dealership's Dealer Management System (DMS), including the F&I, credit and vehicle inventory applications.

Its capabilities also include:
Automatic vehicle-specific quotes
Automatic lead responses with a quote
Ability to accept customer deposits on vehicles
Car Buyers can generate a buyer's order, with deal saved in DMS
Upgrade, protection and warranty information
Trade-in, down payment and payment options
Vehicle hold and sales appointment
BUY A CAR ONLINE!

"A key goal of ADP's Business Online is to ensure the customer's online experience is consistent with the same service they receive in the physical dealership," states Joe Bihner, Vice President of Technology Solutions for ADP Dealer Services. "We have built in the necessary tools including our quote builder solution to make certain that a dealership can meet its customer's needs in any environment."

As part of its Business Online suite, ADP is also introducing Credit Online, a guided online credit application and pre-approval process for online consumers. Available from a dealer's website and delivered in a highly secure environment, ADP's Credit Online is designed to generate high quality finance leads to dealers. It includes a virtual presenter to guide consumers through the process of getting pre-approved. Flexible parameters enable dealers to capture more finance leads that ever before.

"These offerings are just the beginning of what we will deliver as options within ADP's Business Online suite. Every profit center in the dealership will eventually be included in our solution," adds Bihner

About ADP
Automatic Data Processing, Inc. (NYSE: ADP), with nearly $8 billion in revenues and approximately 585,000 clients, is one of the world's largest providers of business outsourcing solutions. ADP is a leading provider of integrated computing solutions to auto, truck, motorcycle, marine and recreational vehicle dealers throughou
Hey Ralph, as always - you have hit it on the head with both the problem and the solution.

The question that I raised in this forum was intended to surface the need to provide applications that will allow a customer to buy a car online. The efficiencies that the Internet provides are increasing exponentially as applications are designed to increase R.O.I. for the dealer with reduced selling and advertising costs while providing superior service to the consumer. That economy is as basic as it gets - it is a win-win scenario!

I believe that ADP's solution to replicate and integrate real world selling processes on the virtual showroom coupled with DealMaker's ability to allow the free marketplace to establish the price is another winning combination; they are not mutually exclusive.

Most sites include many conversion tools and applications to fit many types of customers. The proven "best practice" is to offer multiple channels and applications to do business in both the real and the virtual showroom so why are we limiting the online transatction solution to one solution fits all?

Ai Dealer, for example, offers a self serve desking application that allows the consumer to build their own deal in advance of any human contact. The "shopping cart" image that they present is easily recognized by the online shopper and it provides information with no obligation to develop enough "trust" to move forward in both the virtual and the real world.

As for those replies that are concerned about losing the people part of the process - are you suggesting that our "job descriptions" will stay the same today as they will tomorrow? They haven't in the past so why should they in the future?

How many BDC and Internet mangers were there in 1976 when I was a General Manger at Largo Honda - NONE! How many of the members of ADM were discussing websites - let alone online transaction applications - as recent as five years ago - maybe half?

My point - ADP has a solution that I have seen in the field that works but it is still based on one-to-one negotiations and a single buyer and seller with the potential for one to lose and one to win. Since all parties to a deal should feel like they won - why not make the transaction transparent by opening it to the free market place? The "bidding" format that DealMaker has developed will allow every dealer to compete on an even playing field in full view of the consumer just as the consumer will be required to pay a fair profit based on their need to compete with the other consumers on a real time playing field.

The frustration of leaving money on the table to post the cheapest price is a proven truth experienced by everyone in ADM that has ever posted a loss leader to capture a shopper in the hopes of bumping them on delivery or working the back end for some profit. Even if you got that deal no one won! The dealer lost money and the shopper only did business with you because he stole it - no loyalty was developed or earned.

Data confirms that online shoppers - when asked how much profit they would offer a dealer on a $25,000 car - suggested as much as $2,500 while none suggested that the dealer lose money! DealMaker has a solution to prevent shoppers from stealing the car and it allows the dealer to let the market set his price - not his fear of loss!

The point - get ADP's solution or Ai Dealers and link it to DealMaker while changing your job description to fit the future or someone else will!!!!!!
Ralph this looks quite interesting, but where can we look at it? I can find the news report but not the actual "ADP buy online" product.
The 1st site to visit and create an account with is www.L2.com .

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