Thoughts about a Unique lead system

[MullerToyota]

The current model for most websites are either, build a list of all makes and models and then have a client browse through them and then create a "Get a Quote" lead and the lead is then sold to multiple dealers buying the lead. Dealers still pay for this lead but the closing ratio is not very high. I wanted to come up with a system that generates higher closing ratios per lead.

You are missing the whole point. Dealers don't want to spend more money on 3rd party leads. We don't like them. We don't want them. They are no good. But, in order to not miss a significant portion of shoppers we must buy them. And we only buy the best.

Now, no offense to you and your idea. But, your website has no authority whatsoever. You don't have people that trust you as a brand looking to your site for information. So, your site is irrelevant to me.

I don't care to spend money with an irrelevant site trying to do my job and charging me to do it.

If you want to do this, the first thing you should do is create a site that rivals edmunds.com, consumer reports, or cars.com for their trust with consumers.

Let me know how that goes for you...

 

[Khoi Diep]

You are missing the whole point. Dealers don't want to spend more money on 3rd party leads. We don't like them. We don't want them. They are no good. But, in order to not miss a significant portion of shoppers we must buy them. And we only buy the best.

Now, no offense to you and your idea. But, your website has no authority whatsoever. You don't have people that trust you as a brand looking to your site for information. So, your site is irrelevant to me.

I don't care to spend money with an irrelevant site trying to do my job and charging me to do it.

If you want to do this, the first thing you should do is create a site that rivals edmunds.com, consumer reports, or cars.com for their trust with consumers.

Let me know how that goes for you...

Thank you Clay for the insight.

If you are successful marketing your cars and inventory, then you won't have a need for our site. But as you say, you don't want to miss any opportunity out their either.

As for only buying the best lead, how is that determined? How big the website is that you're buying from or how quickly the lead turns into a prospect and showroom appointment?

As for being as big as Cars.com or Edmunds, that will take time. Rome was not built in a day, we just launched and we launched on a small scale just to test the waters.

 

[MullerToyota]

Thank you Clay for the insight.

If you are successful marketing your cars and inventory, then you won't have a need for our site. But as you say, you don't want to miss any opportunity out their either.

As for only buying the best lead, how is that determined? How big the website is that you're buying from or how quickly the lead turns into a prospect and showroom appointment?

As for being as big as Cars.com or Edmunds, that will take time. Rome was not built in a day, we just launched and we launched on a small scale just to test the waters.

Again, you misread and misinterpreted what I said.

I never said I want to miss an opportunity. I have canceled ZAG, dealix, autobytel, carsdirect, etc etc. And I'm not ever going to go back. Clearly I am okay missing those leads.

I said that "in order to not miss a significant portion of shoppers".

How, then do I equate that to the sites I listed as the best sites to buy from?

They are a trusted source of car buying information for shoppers and, unfortunately, command my attention because of their sheer size and brand recognition.

But there is one thing that differentiates them from you. They bring in leads based on their own brand and sell them to me.

You, on the other hand, would be using my inventory and my deals and my brand to sell me my own leads. I don't need a middle man to do my online marketing. That is why my boss pays me.

Basically, your entire model reminds me of ZAG.com - an experience I never wish to repeat.

We gave them our best deals and they never even charged us for a lead! Just a sale.

What a great idea. Until you realize that in order to be competitive you had to sell cars for $1,000 below invoice and then pay another $299 to ZAG. What a ripoff.

So, I wish you the best of luck on your adventures - but, again, you are asking a lot of people who don't think very highly of 3rd party lead providers - what they should think of your idea to take out money.

I hope you can see how this is a conflict of interest for all of us who want to generate our own leads. Because, in your model, whether I get the lead or not, I am still competing with other dealers with my inventory and my pricing.

Sorry to put this in reality for you. I am sure there are dealers that prefer to be lazy that would love your idea. But, this is not the forum to push it in and expect a positive response.

 

[Khoi Diep]

Again, you misread and misinterpreted what I said.

I never said I want to miss an opportunity. I have canceled ZAG, dealix, autobytel, carsdirect, etc etc. And I'm not ever going to go back. Clearly I am okay missing those leads.

I said that "in order to not miss a significant portion of shoppers".

How, then do I equate that to the sites I listed as the best sites to buy from?

They are a trusted source of car buying information for shoppers and, unfortunately, command my attention because of their sheer size and brand recognition.

But there is one thing that differentiates them from you. They bring in leads based on their own brand and sell them to me.

You, on the other hand, would be using my inventory and my deals and my brand to sell me my own leads. I don't need a middle man to do my online marketing. That is why my boss pays me.

Basically, your entire model reminds me of ZAG.com - an experience I never wish to repeat.

We gave them our best deals and they never even charged us for a lead! Just a sale.

What a great idea. Until you realize that in order to be competitive you had to sell cars for $1,000 below invoice and then pay another $299 to ZAG. What a ripoff.

So, I wish you the best of luck on your adventures - but, again, you are asking a lot of people who don't think very highly of 3rd party lead providers - what they should think of your idea to take out money.

I hope you can see how this is a conflict of interest for all of us who want to generate our own leads. Because, in your model, whether I get the lead or not, I am still competing with other dealers with my inventory and my pricing.

Sorry to put this in reality for you. I am sure there are dealers that prefer to be lazy that would love your idea. But, this is not the forum to push it in and expect a positive response.

Thanks. I see your point. It's true if you can market and sell your own inventory and generate all of your own leads without needing any outside help is wonderful and I applauded you if you can do it.

I didn't come in to push any product, just asking questions and getting feed back. Which I thank you for.

 

[MullerToyota]

Thanks. I see your point. It's true if you can market and sell your own inventory and generate all of your own leads without needing any outside help is wonderful and I applauded you if you can do it.

I didn't come in to push any product, just asking questions and getting feed back. Which I thank you for.

No, I understand. I really don't want to seem like a dick, although I'm sure that is how it looks now. But, I was giving you my 100% serious feedback about how I feel about third party leads.

Have you looked at TrueCar.com? It is almost identical in nature to what you are doing, except that they don't equate the inventory portion into it.

I just want to warn you that the hay days of buying third party leads is slowly evaporating.

My main focus is currently:

1) PPC - make it better faster stronger
2) Conversions - Can I get past 5%? What about double digits?
3) Reviews - how do I manage like 10 different sites that are all reviewing my dealership separately?

Oh, and yea, sell cars too...

The fact is that third party leads sell like crap. I'm lucky to get close to 8%. My website leads close at 20%. The gross from my website leads is approx. $2,000 per car front and back - new and used. The gross from my third party leads is around $800 per car or less and at 8% it costs me another $300-$400 just to find a buyer.

If you can find a way to make money by helping a dealer increase targeted traffic to their site for less than the cost of a good PPC campaign or increase conversions, then you have a tool worth looking at. Right now, I spend about $20 per lead for PPC leads and close at my site average of 20%.

The only tool that I use that helps my conversions is Black Book Online. It is tremendous and I spend like $199/mo on it. It easily converts an additional 1% of my traffic and I close between 15% to 18% of those leads.

So, if you can show me a savings to using you over what I am already doing, then I would be interested. But, we are talking about providing me with something that can either close at higher than 20% for around $20 per lead or close at 8% for less than $20 per lead. I don't go for the whole, my lead is better you should pay more. Instead, you should feel privileged that I allow you to use my inventory and sell my cars to put money in your pocket with nowhere near the overhead of the dealership. So, you gotta make ME a deal that I can't refuse.

 

[Khoi Diep]

No, I understand. I really don't want to seem like a dick, although I'm sure that is how it looks now. But, I was giving you my 100% serious feedback about how I feel about third party leads.

Have you looked at TrueCar.com? It is almost identical in nature to what you are doing, except that they don't equate the inventory portion into it.

I just want to warn you that the hay days of buying third party leads is slowly evaporating.

My main focus is currently:

1) PPC - make it better faster stronger
2) Conversions - Can I get past 5%? What about double digits?
3) Reviews - how do I manage like 10 different sites that are all reviewing my dealership separately?

Oh, and yea, sell cars too...

The fact is that third party leads sell like crap. I'm lucky to get close to 8%. My website leads close at 20%. The gross from my website leads is approx. $2,000 per car front and back - new and used. The gross from my third party leads is around $800 per car or less and at 8% it costs me another $300-$400 just to find a buyer.

If you can find a way to make money by helping a dealer increase targeted traffic to their site for less than the cost of a good PPC campaign or increase conversions, then you have a tool worth looking at. Right now, I spend about $20 per lead for PPC leads and close at my site average of 20%.

The only tool that I use that helps my conversions is Black Book Online. It is tremendous and I spend like $199/mo on it. It easily converts an additional 1% of my traffic and I close between 15% to 18% of those leads.

So, if you can show me a savings to using you over what I am already doing, then I would be interested. But, we are talking about providing me with something that can either close at higher than 20% for around $20 per lead or close at 8% for less than $20 per lead. I don't go for the whole, my lead is better you should pay more. Instead, you should feel privileged that I allow you to use my inventory and sell my cars to put money in your pocket with nowhere near the overhead of the dealership. So, you gotta make ME a deal that I can't refuse.

Your numbers are good. It sounds like you know your what you want and need. My site would help you with the 10 2010 Camry's you have in stock that you would want to move and also any manager demos you have with miles on them that needs to go. Really my site is for the top 10 percent of your inventory that's the oldest and the cars you want to move. If its a good enough deal, someone will buy be interested.

My site would be marketing and finding clients for those cars for you. These aren't going to be your home run cars, but its a car that you can sell and advertise for cheaper than anything else you have on your lot. Once you have a live lead and a warm voice to talk to, then you can sell them that car or have an opportunity to sell them something else. That's up to your internet sales department. We just bring you a lead that hasn't been sold to anyone else and a client that is interested in a car that is on your lot. I'm betting that lead is a lot higher quality lead than what everyone else is selling.

Maybe you can see some value in our system.

 

[Matt DoCampo]

The problem with your model is it is limited to manufacturers who allow dealers to list inventory with prices below MSRP.

 

[MullerToyota]

The other problem that you don't see is that you aren't bringing me a lead that hasn't talked to someone else. The only thing you are doing it limiting the amount of leads I receive based on my deals vs. my competition.

I know my competition will beat me on price. So, in your model, I actually would never even get the opportunity to speak to a customer. They would already know not to buy from me because my deals won't be better.

You know how I achieve the numbers I do? It is really easy. Call early and call often.

I am better on the phone than my competition. I do better follow-up. I train my employees better. I have a better reputation. But, the one thing I don't have - is better deals.

 

[Khoi Diep]

The problem with your model is it is limited to manufacturers who allow dealers to list inventory with prices below MSRP.

We get around this by not displaying which dealer is posting the deal until a member signs up and wants to contact the dealer. So dealer detail is not displayed to everyone on the site.

The other problem that you don't see is that you aren't bringing me a lead that hasn't talked to someone else. The only thing you are doing it limiting the amount of leads I receive based on my deals vs. my competition.

I know my competition will beat me on price. So, in your model, I actually would never even get the opportunity to speak to a customer. They would already know not to buy from me because my deals won't be better.

You know how I achieve the numbers I do? It is really easy. Call early and call often.

I am better on the phone than my competition. I do better follow-up. I train my employees better. I have a better reputation. But, the one thing I don't have - is better deals.

This is all true. You are actually only getting leads based on the deals you post. Which if you don't have any cars you want to sell at a low price and move, then you won't post anything. My site will act as an extra marketing tool for certain inventory, it won't be your primary lead provider. But if you get 10-20 leads per month and it's a high closing ratio for low cost. How could that be a bad thing?

But we have a car locating service where if a car does not exist on our deals page, a client can then build the exact car they want. Dealers of that brand we be notified and you'll have a chance to submit a car for that client if you have it in stock. If the client likes the car you replied with, they can hit contact and the leads get sent to you.