Professional Community for Car Dealers, Marketing, Advertising and Sales Leaders
DealerTrack's announcement that they acquired ClickMotive for 48.9 million in cash came as no surprise to me. It was not a surprise because I had insider information. Quite the contrary. I have been predicting that the marketplace would have to consolidate based on market forces and technology trends.
There are over 50 companies offering car dealers website platforms; too many choices for such a core function for automotive retailers. Many of these website companies are single product solutions which is becoming a liability in an industry that is moving towards complete end-to-end marketing solutions. (i.e. VinSolutions, Dealer.com, and Cobalt.com)
Each year PCG Consulting gives out the annual Automotive Website Awards (AWA). The review process gives me a birds-eye view of the marketplace for technology solutions that serve car dealers.
ClickMotive has strong products and a large customer base (3,000 dealers) that would be an ideal fit for any company looking to create their own robust, full-service marketing platform. ClickMotive has been recognized with AWA awards for their desktop website technology as well as for their mobile solutions for dealers. ClickMotive also provides dealers with a digital advertising solutions; search, display, and retargeting campaigns.
DealerTrack was missing a robust digital marketing platform to compliment the website and inventory management tools provided by their eCarlist acquisition in 2011. Time will tell if DealerTrack can pull off the required integration to create a powerful management console for their diverse portfolio of software products; DMS, Websites, Mobile Technology, Inventory Management, Vehicle Merchandising, and Advertising .
The future DealerTrack backend user interface will be critical for the company to call their suite of products fully integrated. Companies like Dealer.com and VinSolutions have a head start on DealerTrack by providing a robust single-login solution for all their marketing products.
So you can see that integrated platforms is not just a fad but a very serious trend in our industry to reduce the number of products and companies that dealers need to run their business using data and analytics to compliment their operational team.
I'm betting that DealerTrack will do a good job at maximizing the tools that they now have in their possession. The only missing piece left for DealerTrack is a powerful CRM solution. The clock is ticking...who will be the next acquisition? Any predictions?
As I look out at the automotive marketplace, it will be increasingly difficult for stand alone digital marketing companies to make a living. There are many great products designed for car dealers that are begging to be incorporated into a suite of marketing solutions that provide integrated analytics and reporting. How many stand alone products can you name that will eventually be merged into a robust marketing platform?
Take chat for example. There are over a dozen chat solutions used by car dealers on their websites and only Dealer eProcess has a fully integrated chat solution. Do you see a future where chat can continue to be a silo product? I don't. Chat should be part of a powerful CRM solution that allows dealers to communicate with customer with any device and any form of communication technology.
How about equity mining? This software functionality should be integrated into the CRM system. Equity mining software will enable dealership sales professionals to pull customers coming into the service drive or who are in equity and present compelling reasons why they should upgrade to a newer model vehicle. There is no reason why this should not be a part of core CRM functionality.
How about websites? With OEM endorsements being the real goldmine for software providers, will OEM's start to endorse solutions that come with integrated marketing components and shy away from stand-alone solutions? Integrated platforms can offer dealers and OEM's a far richer dataset than stand alone products.
The owners of the very best stand-alone products in our industry need to come together SOON and work out consolidation/partnership deals before the music stops.
The automotive services industry is playing a very critical game of musical chairs. When the music stops, there will be some companies that will not have a chair to sit on.
Any vendors reading this article should heed this warning. Robust, integrated marketing solutions are the norm in other industries. The automotive retail industry will be no exception, it just has taken a while to catch up with the rest of the world.
Dealers reading this article should also take note; pick your partners carefully. If your technology partners are not growing their set of marketing, analytics, and decision making tools you should be looking for companies that are taking the lead.
Enterprise reporting and leveraging "big data" will be key components to the most profitable dealerships in the years to come. What do you have to say about this wave of consolidation? Add your comments below.
Brian Pasch, CEO