Will Dataium Revolutionize Automotive Digital Marketing and the Role of CRM?

Part 2 - click here for Part 1

I’m confident that Dataium executives have seen the golden opportunity to change the way marketing decisions are made in our industry. They are sprinting to create the largest and most powerful network of consumer behavioral data to become a market leader of this emerging industry.


If the Dataium “cloud intelligence” database is the richest available, OEM’s will be compelled to license their feed to enhance their marketing strategies. CRM vendors will want Dataium consumer data feed to create more powerful CRM processes.

Does Dataium have any competitors today? It looks like they have a head start but being first does not guarantee the largest market share in the long run. As I looked at the opportunities in the automotive industry, could Autotrader build a similar model to create greater enticements for dealers to use their newly acquired products and services?

Autotrader.com and subsidiaries may be playing nice with data aggregation companies today but what if one day they stopped? What if they used their end-to-end digital automotive products and services to offer a compelling set of business intelligence tools that a dealer could not afford to ignore?

If Autotrader decided to compete with Dataium, how would this impact the quality of Dataium’s network? Since Dataium does not own websites, do power players limit their upside potential?

Let me suggest why Autotrader may want to build their own consumer intelligence model...

Dealers are not easily compelled to change their website platforms and cringe at the thought of changing the CRM or DMS system. What if Autotrader gave
them a large financial incentive, by offering intelligent CRM functionality, to make that painful short-term change acceptable? Could new business intelligence tools inside of VinSolutions CRM create hundreds of thousands of dollars in profits per store? I think so.

Autotrader Digital Assets

Autotrader.com, a subsidiary of Cox Enterprises, which also owns the Manheim Auctions, has recently made a number of strategic acquisitions. Little details have been shared on their strategy but the Dataium presentation connected the dots for me.

Autotrader has recently purchased Kelley Blue Book, vAuto, and most recently VinSolutions. If you look at the rich data that could be data mined from Autotrader.com and KBB.com and then leveraged with vAuto and VinSolutions CRM the potential is enormous.

The potential for a private Autotrader data network is even greater when you consider that Cox Enterprises owns a number of very large newspapers and media outlets. Each of these digital affiliates collects data on consumers that visit their websites. With millions of visitors coming to Cox owned websites, why wouldn’t Autotrader consider competing with Dataium?

So, if they leverage the data that they have and want to transform the automotive industry, this “fantasy” would only be missing two pieces.

Autotrader Needs a DMS Platform They Control

Autotrader is missing a DMS platform that would connect dealership financial data to sales and marketing data from the Internet. The two major DMS providers are Reynolds & Reynolds and ADP/Cobalt with a number of smaller companies in the market.

ADP/Cobalt is clearly creating a robust digital marketing platform. ADP/Cobalt has made massive strides to develop a stronger platform with enhances services to meet the needs of dealers. Their accomplishments have placed them in the top recommended website providers for 2011.

It would be hard for me to believe that Autotrader would consider an ADP relationship based on the momentum that the ADP/Cobalt marriage has produced.

Reynolds & Reynolds has been strangely quiet from a digital marketing services perspective. Their website technology and marketing tools have lagged the marketplace. Could R&R be resting on their DMS laurels?

I have the least insights into Reynolds & Reynolds, but from industry veterans I asked, an Autotrader deal would seem unlikely.

That leaves DMS companies that have smaller market share but promising technology and leadership. DealerTrack has been on their own acquisition spree lately gobbling up website provider eCarList.

DealerTrack has a “market pricing” tool (AAX), which competes with vAuto. This adds some complexity to a potential marriage. A partnership with Autotrader may be appealing to DealerTrack to jumpstart their market share and to take advantage of dealers that have little loyalty to ADP or Reynolds & Reynolds.

Let me state that dealers have strong reasons not to change their DMS; it’s disrupting to business operations. However, if the benefits of a VinSolutions CRM system powered by ZMOT data deliver an unfair competitive edge to dealers on an Autotrader integrated marketing platform, ADP and R&R better have a new client retention strategy.

The Autotrader Data Network

If the DMS issue was resolved and all parties worked to create a data integration strategy, it is likely that Autotrader could shake up the automotive industry. In an ideal world, Autotrader would offer rich data sets and tools to offer dealers from the start of the car sales process all the way to the final sale and into service retention.

For used cars, the Autotrader platform would have data on Manheim pricing and then make sure that dealer cars are properly merchandized on Autotrader and VinSolutions websites using market-pricing tools.

Consumers who visit Kelley Blue Book, Autotrader, a VinSolutions website, or any number of websites in the Cox Enterprises network could be tracked, consolidated, and rolled-up into actionable information in the VinSolutions CRM product.

When this network is completed, it would create strong competitive advantages for dealers. It will also create a very compelling case for OEM’s to consider Autotrader as a recommended platform for franchise dealers.

If such a product were created it would make a strong case for dealers to uproot their DMS and CRM systems. There are no truly compelling products on the market today that would motivate a dealer to change their DMS. Business intelligence tools may be the killer app for established DMS providers unless they offer similar functionality with partnerships with Dataium or similar companies.

Autotrader Needs Marketing and Education Strategy

Dealers are just starting to understand that their advertising and marketing budgets must go under significant review. Progressive dealers are moving a significant portion of their budgets to digital strategies that can be measured.

Dealers are just learning about the importance of the Zero Moment of Truth (ZMOT) and how review websites are impacting their sales and marketing investments BEFORE a customer ever contacts the dealership.

The potential that the Autotrader network offers or Dataium business intelligence tools will be limited by dealer education and confidence. The benefits of rich data are based on an understanding of ZMOT. The transformation of business rules and processes based on rich data automation will not be without skeptics.

Will these companies create a strategy that a dealer can understand?
Will the presentation be convincing enough for dealers to uproot their DMS systems?
Will dealers have confidence that the implementation will be well supported?

I have the opportunity to educate thousands of automotive professionals a year and communicating new digital concepts is not without unique challenges. Companies that will be offering new automotive business intelligence tools must develop a consulting and training strategy to accelerate market opportunities and market share.

Does The Autotrader Network Put Cars.com In Play?

Dealer.com is a smart company. Last year they purchased EpikOne, a company that specialized in metrics strategies, media measurement and user experience optimization without much fanfare. Dealer.com has significant market share and they have not been sitting idle during the Autotrader buying spree.

Will the potential for a powerful AutoTrader data network create new alliances with major website players and Cars.com, EveryCarListed.com, or the Automotive Advertising Network (AAN)?

Will companies like ADP/Cobalt and Dominion Dealer Solutions expedite the integration of their individual technology platforms? What about the powerful stand-alone website providers on the market today?

Many questions and too few answers are available at this time! What you can count on is that PCG Digital Marketing will be keeping dealers apprised of the latest developments in search marketing, website technology, and digital marketing strategy.

I recently attended the 2011 Ignite Dealer Summit in Minnesota and was fortunate to hear a presentation by Jason Ezell, President and Co-Founder, Dataium LLC.


Jason discussed the benefits that dealers can realize today from business intelligence tools based on consumer shopping behavior on the Internet.

The level of detail of each Internet consumer varies based on Dataium’s relationship with the websites the consumer visits.  Dataium has partnered with OEM’s, dealers, social media platforms, and automotive website providers to place their tracking code on their websites.

Google on the other hand provides free data on “assisting websites” as part of Google Analytics Multi Channel Sales Funnels, which I will discuss in greater detail in a minute. The data that Google Analytics would provide is at a basic level, like “consumer A” visited YouTube and then Craigslist prior to hitting a dealer website. The software can then help you define the top Conversion Paths taken by consumers which is very valuable information for prioritizing your advertising investments.

The Dataium code is designed to identify and track consumer behavior at a higher level of detail. Dataium tracking would know which specific pages on a website were viewed. Tapping this data to create automated actionable business rules in a dealer’s CRM system will change the face of sale sales, service, and digital marketing.

 

Recovering Leads In Your CRM System

One application of cloud based business intelligence tools I considered was helping dealers recover value in the thousands of leads that their sales staff have marked  “unworkable” or "dead" in their CRM system.  This is a major CRM challenge for dealer principals since their BDC has such power over marking leads.

Each month dealers receive new leads to work directly from their website or through 3rd party providers. I don’t have to remind dealers that sales professionals love to cherry pick leads. Consumer leads that are past their “prime” are left alone for more promising, current month leads.

If human labor was not involved, wouldn’t it be powerful to be notified that when your “unworkable consumers” are back online shopping for a car somewhere else?

 

How Big Is The Potential Network?

Imagine if this network of websites included Autotrader.com, KBB.com, Cars.com, Ebay.com, Edmunds.com, Motortrend.com, OEM websites, automotive chat communities, and website that could provide actionable data like banking or credit websites.

Imagine a day when your sales team is notified that former customer Ms. Jones, that was marked unworkable in your CRM, took 3 minutes to view the product pages for a 2012 Jeep Wrangler on Jeep.com today.  Imagine how the sales process will change if the notification also reported that Ms. Jones had also visited Autotrader.com today and viewed nine Vehicle Detail Pages (VDP) on 2010 and 2011 used Jeep Wrangler.

What would your chance of reconnecting with this in-market shopper prior to this new type of automated tracking and business intelligence tools?  Slim to none.

Imagine the power of a phone call that comes from your sales team, triggered by this data, that starts with, “Ms. Jones, I know you contacted our dealership a few months back about a Jeep and I was just calling you back to see if you are still in the market and if we can assist you?”

 

Smart Data Warehousing Powers Dataium Model

The key to making this concept work is to connect thousands of websites that collect consumer information.  As consumers submit lead forms, their IP address is associated with a data record.  Most lead forms have basic contact information, phone numbers and email addresses.

If you have access to enough consumer data you can start matching this data back to consumer records and activity on other websites.

In addition to lead forms, cookies left on the consumer’s browser can provide websites with a rich data stream of which websites the consumer previously visited.  This concept creates a data warehouse that will change the face of online sales.  Read ahead and let’s see how this may play out.

 

Changing The Costs Of Customer Engagement and Retention

Dealers can’t afford to call their aged leads with the hope they will find the 2-3% of the list that are still in the market for a car.  Dealers can’t afford to call their existing customers back every month asking if they are in the market for a car.

The day is quickly coming when dealers will be notified when their customers and prospects are engaging in automotive shopping behavior. This alert will allow them to insert their business back into the sales cycle.

Automotive sales professionals attempt a timely and compelling response to a consumer who submits a lead form on their website.  Imagine the quality of initial engagement that could be achieved if the lead came with the consumer’s previous online shopping behavior.

In the near future, a lead coming into the CRM system will include rich data.  For example, it could report that the consumer had visited Chevrolet.com and looked at a 2011 Chevrolet Silverado.  It could inform the dealer that the same consumer visited Kelly Blue Book and requested a trade-in estimate for a 2003 Silverado.

Would you change the way you initially greeted a consumer if a richer dataset was available?  I bet all dealers would shout affirmatively: yes!

To some degree it is here today and greater advances will be announced in the coming years.  Dataium co-founder Jason Ezell stated that approximately 5,000 dealers have their tracking code installed on their websites.

Although he did not include all the data partners in the Dataium network, his model immediately triggered a thought about Autotrader.com and their recent acquisitions.  Could they build a powerful competing business intelligence model exclusive to their customers?

 

The Future of Automotive Digital Marketing

As automotive websites become standardized and commoditized by OEM regulations, it will be more important for dealers to have a rich set of business intelligence tools and automated CRM that assist them with communicating with consumers more effectively.

A well designed website with a compliant SEO structure and the ability to easily update photos, specials, and content will be the norm and no longer cutting edge.  This year, the number of website platforms that are Google SEO compliant have significantly increased.  Dealers have demanded better websites and the vendors have responded, but as you will read, that conversation is last year’s news.

Companies who offer only website platforms to dealers should take note of the massive changes that are coming.  I predict more consolidation will occur in 2012, which will narrow the field of companies providing websites to dealers.  Reason will be simple.  Data analytics and smarter CRM processes will be the key focus for car dealers and not the shiny object of a “compliant” website.

 

The Appeal of OEM Website Contracts


I finally understand why companies like Cobalt, ClickMotive, and Dealer.com are so motivated to obtain long term OEM website contracts that mandate their technology for franchise dealers.   These contracts enabled the contracted companies to offer business intelligence tools that the OEM’s could use to measure and compare dealers and understand consumer online shopping behavior.

The unique advantage that OEM platform providers have is that they can track on-site inventory searches, page views, and see which paths led to a form being submitted or a call being made.  The internal site data and lead tracking is not available to outside analytics companies like Google.

Having access to data across a network of thousands of individual OEM dealer websites is powerful. Access to OEM franchise data is not golden ticket it once was.  The real win for vendors and dealers will come from aggregated data from dealer websites and third party sites that influence automotive sales and service decisions.

The automotive industry in the coming years will be extremely focused on developing alerts and CRM event triggers during the Zero Moment of Truth (ZMOT).  Google defines ZMOT as any websites that consumers visit prior to contacting a dealer that influence their buying decision are included in the ZMOT.

The second part of this article will discuss the players that may be seeking to claim bragging rights to being the first to deliver a rich set of data and business processes for dealer CRM systems based on ZMOT behaviors.

Is there a competitor lurking in the shadows that is ready to take a bit out of Dataium's lunch?  Maybe...but that will have to wait for Part II of this article.