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True Car and ZAG - Cyber Bandits or Good for the Business?

Jim Ziegler asks...

I am hearing a lot of discussion about True Car and ZAG.  I continually scratch my head and wonder if  desperate dealers are doing the marketing limbo "How Low Can You Go?" 

Are we so bad at what we do that we have to line up and pay vendors to lose money? AND, who is giving these people access to your data that is used against you? 


Who owns these companies and what might be their ulterior motive?  Sometimes I ask questions to which I already know the answer. 


Am I wrong?

What do you think... JIM







EDITOR'S NOTE: The ADM Professional Community has assigned a short-cut domain name to this blog post by Jim Ziegler to make it very easy for ADM members and readers to refer others to this web page. Please use the following URL:


Jim Ziegler's Guidance and Recommended Action Plan:

Ten Areas We Need to Concentrate on to Bring This Monster to It's Knees...

  1. Government investigation of ALL Data Aggregators taking consumer information from dealers' DMS. Sadly enough, dealers who do business with TrueCar are exposed to  liability charges. Cut off all access to unecessary data, no matter who takes it from the dealers DMS and make it illegal to "resell identifiable consumer data" and "transactional data".
  2. Educate Your Fellow Dealers; If anyone takes financial transactional data, they expose the dealer that allowed it to violations, especially if it is passed on to other vendors or shared.
  3. Educate Consumers to what they're doing with their information...
    a. You buy a car from a dealer, do you really want your personal information, and maybe even your financial information, passed along and sold and shared by "God knows who?"
    b. These People Charge the Dealer $300 which the dealers have to build into the deal
    c. Your Privacy and the Security of your Information could theoretically compromise your identity if you do business a company that takes data from the dealership.
  4. Educate Investors and potential investors they could possibly be mislead if anyone is telling them this is a safe investment because of all of the dealers pushing back, associations pushing back, and government regulators in many states coming after TrueCar's business model as NOT compliant, in some cases they're saying it is Not Legal.
  5. AMEX, USAA and all of their affiliates do not want the bad consumer relations this push back is creating with their members and customers.
  6. Cancel your dealership's Affilation with TrueCar. Tell people with TrueCar certificates that YOU don't honor TrueCar and you feel the company is NOT reputable. Educate consumers as to perceived data exposure if they buy from a TrueCar dealer. Make sure that each consumer knows that using TrueCar actually increases their vehicle cost by $300 to $400.
  7. Make the dealers selling at huge losses take all of those deals. Big problem right now is too many Nissan Dealers and others are taking huge losers to get the factory money. The TrueCar reverse-auction business model will continually push those numbers down until the factory money is non-existent. Consumers need to hear from many dealers, "We don't do TrueCar"
  8. Keep calling your National and State Dealer Associations demanding they get involved and stay involved... No excuses.
  9. Get the Manufacturers into the game. If GM, Ford, Toyota, and other majors change the rules about how we advertise and do business to protect the dealers, we can cut off their ability to set pricing. So keep it up at every dealer meeting. Call your Dealer Council Members and protest to your factory reps. Tell the manufacturers, if they want showroom and facility improvements, we need the ability to make fair profits.
  10. Tell everyone you know. Educate other dealers and industry people. Watch the Painter interviews... I believe this is the first time a vendor has publicly announced they intend to bring down the dealers and hijack our business, taking our profits and starving us out with our own data. Painter has said manufacturers and dealers should go bankrupt and he, in his God-like way "will control distribution..."
    When the TrueCar-Yahoo Deal kicks in we need to stand firm and "Just Say No" we don't honor TrueCar deals.

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Comment by George O'Sullivan on December 28, 2011 at 12:24pm

I would really like to see Yahoo! decide against using the TrueCar service.

Comment by James A. Ziegler on December 28, 2011 at 9:16am

Little quiet on the TrueCar scene today... gone but not forgotten. Promise to re- crank this Blog soon. It will continue bigger than previously...I'm working on some bigger surprises that are taking my time. You'll be surprised at what's going to happen next.  watch here for TrueNews coming soon. 

Comment by Keith Shetterly on December 28, 2011 at 7:35am

It gets worse, if you go back far enough.  From 2001, Painter is complaining about how Wall Street " Wall Street, Painter grouses, is serving both seller and buyer in the same transaction, a blatant conflict of interest. "The interests of the investment bankers run totally counter to the interests of the issuers," he says. "The entire system is obsolete."

"is serving both seller and buyer in the same transaction, a blatant conflict of interest" . . . hmmm.  Sound like TrueCar today?  I think so.

Comment by Keith Shetterly on December 28, 2011 at 5:55am

Hmmm.  Back in 2007, Painter described Zag (which became TrueCar) as a broker.  

"We spoke quite a while ago about Zag, before you launched--tell us a little bit about where Zag is now?

Scott Painter: The strategy for what we're building, really, is quite simple.  <snip> In many ways, you can think of it as an all those auto information sites out there, coupled with an auto buying/brokerage/sales situation, coupled with actual dealers that fulfill."

Comment by James A. Ziegler on December 27, 2011 at 5:02pm

Be careful of Carfax data as well.  Located in the very "fine print" of your Carfax contract gives them access to your service records!  

Comment by Ralph Paglia on December 27, 2011 at 11:39am

Rob - Thank you for the YouTube link for Scott Painter's interview by Bimbo, er, Bambi Francisco (me bad).  I am sorry, Bambi, but when you try to add color commentary about the auto industry as if you know something about it, you sound like an idiot.  Now, I am certain you have never sold cars for a living, but HAVE YOU EVER ACTUALLY PURCHASED A VEHICLE? Because, your comments indicate complete ignorance at a level that makes you unqualified to interview somebody like Scott Painter.

Rob, your link allowed me to download a clean copy without the TV commercials at the beginning... Here is the clean version posted to ADM a few minutes ago:

Find more videos like this on Automotive Digital Marketing Professional Community

Comment by Keith Shetterly on December 27, 2011 at 11:10am

Tom - No kidding!!!!  

Comment by Thomas A. Kelly on December 27, 2011 at 11:01am

It would really work out swell for Autonation if they were lucky enough to have the 9 ideal Toyota rooftops in place when the other 51 pesky stores close in LA

Comment by Barbara Armour on December 27, 2011 at 10:43am

This video will not endear Scott to dealers for sure- espeically with the comment "reallocate where market share goes"

Comment by James A. Ziegler on December 27, 2011 at 10:30am

Who in the world would be stupid enough to invest in TrueCar with all of this upheaval and uncertainty surrounding their business model. I don't believe GRP Partners is going to find enough people with money that are that stupid

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