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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:

www.TrueCarDealer.com

 

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.

Comment

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Comment by Aj Maida on March 4, 2012 at 9:14am

Interesting point @Kieth. which of us would turn down a profitable car deal just because the buyer was a jerk and we didn't agree with their politics?

Comment by Keith Shetterly on March 4, 2012 at 8:53am

@ Jim:  I think TrueCar wasn't ready for NADA and meeting dealers, and my guess is they feel ready for Digital Dealer for some reason.  I don't think I'll be there this time at DD, but I will be interested to see how that goes with the dealer body.  If anyone wonders why DD would accept the sponsorship, I think they would've have a hard time turning it down.

Comment by Joshua Michael Friedman on March 4, 2012 at 7:51am

I suspect TrueCar leaves a whole different taste in a shopper's mouth, now.  The "target price" is a lot more realistic, and doesn't pit one dealer against another.  In fact, it puts TrueCar in the position of telling a customer what he or she may not want to hear, i.e. in the example below, the average selling price of a new 2012 Camaro LS in Los Angeles is above MSRP, and a really "great price" is within $100 of invoice.  At last, the Truth.  But the Truth isn't as exciting as the fantasy was, and I suspect TrueCar has a whole new product to sell, only it appears to be no more informative than the Edmunds TMV.  That's not great for TrueCar, who, now all of a sudden, are not bringing a unique information product to market.  Hard to generalize from a sample of one, but our experience is that the "new" TrueCar has really cooled off, as far as a productive lead source, in its first full month of existence.

Comment by James A. Ziegler on March 4, 2012 at 7:08am

Amazing... What do you think about Digital Dealer Conference having TrueCar as one of their main sponsors? 

Comment by Joshua Michael Friedman on March 4, 2012 at 6:48am
Comment by Keith Shetterly on February 29, 2012 at 11:55am

If Jim doesn't mind, if I can borrow your attention to this thread - http://www.automotivedigitalmarketing.com/profiles/blogs/the-500mil...  Here's my point re: Jim's blog here:  What are we missing in this vs. TrueCar or the Next TrueCar?  How can $500million dollars of success seem to go so un-noticed in our business?  For years before TrueCar?  And what does this expose that TrueCar did, as well?  Please maintain the TrueCar point on this thread, I'm just trying to ask about something very important.  Isn't $500million of vehicle sales from a single used car lot in Texas important to you, too?  It should be.  Thank you!

Comment by David DeSantis on February 29, 2012 at 7:11am

Thanks for the update Jim.  I can hear TC crying to the government, "we're too big to fail".  I hope to hell there's opposition on both sides on this issue, and they have a hearing on it.  Drag Painter's ass to Washington, and let him tell the government what's really happening with the data.  Bring on the debate!  When consumers find out what's really going on with dealer data, it'll hit the fan!  Painters videos and interviews will really come back to bite him in the a$$!

Comment by James A. Ziegler on February 28, 2012 at 2:44pm

WOW! This article could be the beginning of something huge in the Data Wars!

http://www.fi-magazine.com/News/Story/2012/02/Obama-Unveils-Online-...

Comment by Keith Shetterly on February 28, 2012 at 10:11am

@ Thomas:  I think the "Painter Videos" you just brought up are very powerful.  Far more so than any quoted statements he could have made, as visual evidence makes an impression several times stronger than the written word.

Comment by Thomas A. Kelly on February 28, 2012 at 9:51am

Painter, GRP Partners, have no place in the automotive industry period. My opinion.

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