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CarGuru's 100% Rate Increase!! 2nd time in 2 years

Discussion in '3rd Party Leads and Automotive Classifieds Website' started by mbmotorsports, Jan 3, 2016.

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  1. mbmotorsports

    mbmotorsports
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    First Name:
    Jesse
    Dealer or Company Name:
    mb motorsports
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    Hello all,

    I received a nice "Happy New Year" email from Carguru's stating that my rate would be increasing Feb 1st by 100%. I can continue with Carguru's at this new rate or my account would be cancelled. Carguru's has taken us from $750.00 monthly to $2620.00 and now in Feb to $5640.00. All in just under two years. Inventory has not changed significantly. I tried to negotiate the last rate hike and they had a "take it or leave it" stance. They definitely bring us a significant amount of our business but at this rate i'm not sure what to do.

    I'm not here to bash CarGuru's. They definitely do a great job. I just cant understand these HUGE rate increases. When i signed up I was told the rate was based on inventory. Then i was increased because I opened up two additional locations which I've since closed. Now the hike is due to the traffic they bring us?

    Has anyone has the same experience with them? If I drop them will these leads find us on another 3rd party platform? I'm basically everywhere else!

    see copy of email attached
     
    #1 mbmotorsports, Jan 3, 2016
    Last edited: Jan 5, 2016
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  3. Tallcool1

    Tallcool1
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    First Name:
    Clint
    Dealer or Company Name:
    Clock Tower Auto Mall
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    I have not had the experience that you have had in terms of fee changes.

    As far as the leads finding you through other sources in the event that you drop CarGurus, I wouldn't count on that. In fact, I would assume very much the opposite. I find that our CarGurus leads are a different group of people. These customers find us because of CarGurus, and typically don't see us on any of the other marketplaces.

    I hate that your fees have increased to the level that they have, and I can see that you are in a position of saying yes or no. CarGurus has never given me even the slightest indication that they were flexible with their rates. I guess it is just a matter of looking at the numbers. If you want to spend $250/sale (of course you have to use your numbers) then CarGurus must directly be responsible for 22 or 23 sales. If they aren't, then you have your answer.

    Best of luck to you with this. Maybe they will at least listen to you this time around.

    Clint
     
  4. Chris Leslie

    Chris Leslie
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    First Name:
    Chris K
    Dealer or Company Name:
    Heinrich Auto Group
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    @mbmotorsports@mbmotorsports Thats really bold of them. I'd tell them where they could stick that rate hike.. They are lucky they get the money they get right now. I still think its overpriced currently.

    *** Note to Cargurus people... Please do not call me.. I know you read these boards and have called me in the past about what i've said about you. I don't need any religion on why you think youre awesome. You will never sway my opinion about what you guys are and your prices. Thanks in advance...
     
  5. tomfohr

    tomfohr
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    First Name:
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    Out of curiosity, did you notice a large lift in leads and lead quality between their Free version that masks the phone number and email addresses VS their now highly charged paid version? Reason I ask is because we are in their free program and it is far from our best performing source.
     
  6. Tallcool1

    Tallcool1
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    First Name:
    Clint
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    We noticed a tremendous difference. The free leads (in my opinion) were just teasers. Sort of like a lead generator for CarGurus.

    We do well with CarGurus, but our rates are more modest.
     
  7. tomfohr

    tomfohr
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    First Name:
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    How many used cars do you have in your inventory that they charge you $5k? I am looking at likely getting rid of cars.com and Autotrader for poor performance and looking at other options.
     
  8. Tallcool1

    Tallcool1
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    First Name:
    Clint
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    I am not the original author of this thread. Jesse started the thread. Your question is the first thing I thought when I read it too! I checked his website, and he has 160-170 units on his website.

    I am much smaller, and certainly in a much much smaller market. I have 60-70 units in stock at any given time, and pay about 10% of what Jesse pays. For me, that is a fair rate and I believe CarGurus knows that. I want to be clear with you on this Tom. We don't sell 10 units a month because of CarGurus. It is more like 2 or 3. However, I really like CarGurus. I like the leads that they send me, and my rep does a great job for us. Even though we are small, we still get regular calls. I have a number that I use when I look at my advertising, and that is Cost/Sale. If a vendor fits within that number, I keep them.
     
  9. tomfohr

    tomfohr
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    First Name:
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    Yeah we have approx 240-260 used vehicles on the ground... If I was paying $5k a month, I would definitely need to be selling 20+ units a month that are completely verifiable.... Not the phantom car deals that Autotrader tries to take credit for.
     
  10. Tallcool1

    Tallcool1
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    First Name:
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    ......and it sounds like your cost/sale goal number is pretty darn close to mine!

    I would certainly get in touch with them, and see what they have to offer. They may pitch you an introductory offer or something of that nature.
     
  11. mbmotorsports

    mbmotorsports
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    First Name:
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    Heard from a CarGuru's rep regarding this post. They will be looking into my account to see what can be done. At the very least it's nice to have heard from someone.

    They aren't bad guys! At the $2500 it's a stretch for us but we keep going because the traffic is right on par. We closed two stores in 2015 an I'm not going to swallow $5 Grand!

    I'll post the outcome.
     
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