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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 Jason Manning on February 14, 2012 at 10:01am
I believe they (NADA) can address the value of data to dealers, or we need to find experts who can. That's how things evolve into existence or exstincton. I thought NADA was created out of dealer needs. Isn't the value of dealer data at the top of our "needs list?" Maybe it's just a fad? Heard that one before about Social Media...
Comment by James A. Ziegler on February 14, 2012 at 6:14am

Keith, don't expect NADA to get involved. They cite Federal Anti-Trust laws and Restraint of Trade violations as the main thing holding them back. 

Personally, I don't see why they don't address "Data Issues" without targeting a specific company. 

Comment by James A. Ziegler on February 13, 2012 at 1:01pm

Comment by Jason Manning on February 12, 2012 at 6:28pm
@ Keith I wonder when TrueCar will realize that they can no longer afford to feed their ego...
Comment by Jason Manning on February 12, 2012 at 6:15pm
The Data Horders will stay on dealer doorsteps and databases until we say no...or we realize the value of our data. I wonder if NADA could produce a study to show dealers the value of one customer's complete transaction to the dealer vs. to a vendor, as it stands now. Safe to say it will grow, exponentially, more valuable in the near future. Data studies need to become prevalent in our industry. We have always used guides. We need a data guide. We don't need TrueCar or any vendor to become our guide. Out of ignorance, we thought we were secure and cutting edge with all our vendor products and relationships. Then TrueCar gets agressive and blows the cover off vendors. One of the best things to happen to dealers. Let's ensure we stay focused on this. Let's get secured and more intelligent.
Comment by James A. Ziegler on February 12, 2012 at 3:47pm

I am writing another mass email to 135,000 dealers and industry execs right now to hit Monday morning... Scott Painter doesn't get it. There is no TrueCar if nobody participates. AND no dealerships (relatively) are going to participate with them as long as they take Customers identifiable Information out of dealers computers... If they really were planning a subscription model, there would be no reason to take customer data. Truecar is lying-again- to us and to the consumers.

Customers have a right to privacy without these people accumulating their data, endangering their identity and invading their privacy. Consumers do not realize their is a network of people stealing their identifiable information when they do business with some of these vendor

Comment by Thomas A. Kelly on February 12, 2012 at 3:32pm

By Painter!

Comment by Thomas A. Kelly on February 12, 2012 at 3:32pm

This is BS, it is not a natural tendency that put us in a race to the has been orchestrated!

Comment by Thomas A. Kelly on February 12, 2012 at 3:30pm

From the article James has referred us to :

"But there is no question that dealers' natural tendency to compete with one another has resulted in extremely low prices."

I would ask.....Is it a natural tendency when Painter's reps call dealers and tell them they need to adjust their price because they are not competitive?...Is it a natural tendency when Painter's reps send emails to dealers and tells them they need to adjust their price because others in the group are lower?

Painter needs to be called out line by line when he lies!...There are laws against this behavior, the FTC will have something to say about this before it ends.

Comment by Matt Tucker on February 12, 2012 at 2:46pm
So, let me get this straight. If a TC dealer signs up and offers a price, but then doesn't give it to customer they sell, Scott will cut the customer a check for the difference? Hmmmm.....anyone want to buy a $1 Ferrari? I wonder how much this article cost him? Perhaps we could ask a few posters I've seen here.

And data from 30 different sources, including tax records and lenders. And the "journalist" responds with, "regardless of where the data comes from...". Really?!? WTF? Are these people that brainwashed? TC is telling you that they gather and then assemble YOUR personal data to include your financing and tax records and this idiot dismisses it because it may save him a coupl hundred dollars. Seriously? Talk about 'selling' your soul to the devil.

I do love how they mention the dealers as "about 4100". Guess 1500 is the new 'about' 4100.

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