Automotive Manufacturer Policies on Dealer Websites are too limiting and slow

[Alex Snyder]

Normally when this subject comes up, amongst dealers, a lot of not-so-nice things are said.  I want to take a different approach in this article.  No, I'm not planning to completely side with our manufacturers, but to hopefully create a compelling argument that gets some to rethink their policies (and I'm counting on your comments as well).

I think we all can acknowledge that it is impossible for a national (or even global) corporation to understand every local market.  Some places are a little behind the technology curve and others are deeply into it.  Whether a dealer's market is in the center of the tech universe or in the middle of ho-dum-hickory-ville there are differing marketing strategies for every type.

I think we can all also acknowledge that there are some dealerships who would never invest a dime in a showroom improvement or even a website unless they were forced to.  But I think there are just as many of those as there are the complete opposite, so the majority has to be somewhere in the middle.

As we move deeper into stronger digital marketing mixes we are all finding that the game changes faster and more drastically as newer technologies are engineered.  We have all watched the bigger DMS companies fall behind the curve, and it just shows that the bigger you are the harder it is to turn the ship.  Compared to manufacturers, dealers are more nimble and capable of implementing new things.

Many manufacturers task dealers with specific Internet policies that are outdated by the time dealers start to follow the policies.  Things are moving too quickly.

Branding is a very important element.  Our manufacturers have invested tons of money in building and protecting brand recognitions that we all capitalize on.  With so many websites it is tough for them to police everything, and a simple one for them to enforce is a dealership website's look and feel.  Some manufacturers like MINI, VW, and GM have partnered with CoBalt to enforce that all dealership websites are virtually equal.  Others like Honda, BMW (soon to join with CoBalt too), and Toyota have taken the approach of advertising guidelines toward dealer websites.  They either envelop the website inside DMA money requirements or give compliant dealers perks off the OEM's main website (leads, links, etc).  From the 10,000-foot view either of these approaches are viable.  But consumers don't care about that.

Communication between the manufacturer and dealer is still too much of a one-way street in a lot of cases.  Because the automotive industry was so slow to embrace digital marketing both dealers and OEM's originally staffed these positions with people who may not have been the best for such an important job, while the people who had the power were still conducting business as usual.  I hear about eCommerce meetings between a group of dealers and OEM's from time to time, but it still sounds like OEM's prefer to converse with General Managers and Dealer Principles instead of talking to the people who actually handle these things.  Is this just a path of least resistance thing?  At the end of the day we all want to make more money.  Yeah, we might have some difficult things to say, but that's healthy.

OEM's should talk to dealership eCommerce people more often.

Technology is advancing by the minute (I would say daily, but that's too slow), so hand-cuffing people to something does not allow growth.  Google changed some of its algorithms recently and now we're starting to see some strategies become obsolete.  Customers are empowered and want choice on a website - this must be acknowledged, and embraced.  Third Party Leads and Inventory Aggregate sites are not as effective as they used to be, so why are these still the main focus of Internet co-op for some manufacturers?  Banner ads?  SEM is a much stronger medium than both.  Why isn't this part of the co-op programs?  What about SEO training or SEO development for dealership websites?  And if these things become obsolete, let's be nimble and switch co-op to the next big thing.  Help us help you make more money by being smarter!

Dealer Websites that are dictated by manufacturers brand the manufacturer.  But customers interact with the dealer.

The dealer's name might not be as important to an OEM, but it is very important to the customer.  Almost all customer interaction is with the dealer, and it is very important that the dealer have the ability to brand him/herself.  The most eCommerce-conscious dealers end-up have to spend double on websites because the OEM-dictated one is too limiting (how many VW dealers have 2 websites out there?).

Online Strategy can be worked out together for virtually no cost.  OEM's do not have to fly 20 dealers to a special retreat spot for meetings - we can hammer things out via teleconference or instant messenger conferences.  A forum could be built for posting ideas at any hour of the day.  I'm sure there are quite a few people on Dealer Refresh who would happily volunteer time to work with an OEM as long as the OEM truly listened and acted.  There is a middle ground and I don't think it is that far away!

OEM's - please, start talking to the dealership eCommerce people.  Please start talking to US!

Dealer Refresh would like to take these costs of communication on.  We will host the forum for each manufacturer that wants to participate.  Just let us know.

 

[DigitalRalph.com]

Alex,

You have written a well thought out essay on a subject that is the source of much activity, anxiety and many millions of dollars being spent by both car companies and dealers. Each OEM has taken an approach with variances and features different from the other OEM's. In my opinion none of them have a perfect solution that addresses the issues you raise. However, if you take a look at, for example, what Ford Motor Company has done, which is quite a hybrid approach, you will see that there are no hard and fast dictates or negative repercussions for those dealers that decide to excel beyond what is being done for them by Ford's programs. The DealerConnection web site program is primarily an internally managed and maintained dealer website program which is automatically included with the entire Ford eTools suite at a very minimal cost for an entire package... Yet, each dealer is allowed to create their own web sites above and beyond what the DC sites provide. Lead Management tools can be the Ford supplied SalesPoint, the ancestor of which was one of the first lead management tools, CarPoint from Microsoft, but is now supplied by Reynolds and Reynolds... However, dealers are free to choose from multiple compliant supplier based tools using the Alternative Lead Management program which routes leads in the appropriate format to that supplier's CRM or lead management tool at the dealer's discretion...

Even the 14 month old Dealer Advertising Co-Op program allows the dealer to get OEM funded advertising expense reimbursement for both Search Advertising and Display Advertising, regardless of whether the ads point to the Ford supplied DealerConnection website, or the dealer's own independantly purchased website. The Co-Op guidelines discourage predatory practices such as bidding on other dealer's names and distressed merchandising that hurts the Ford or Lincoln mercury brands, such as "Getting Ready to Go Bankrupt" sales camapaigns.

Could the 12 year old Ford Digital marketing programs be improved? Of course they can... But, I am intimately familiar with over a dozen of the leading OEM programs and Ford's programs have many features that are more progressive and dealer friendly than other OEM's.

You make a strong point about the OEM's need to communicate directly with practitioners at the dealer level. Ford does this through a combination of ongoing forums, groups, blogs, and communities for ISM's, weekly eNewsletters from both IMN and Outsell that provide several channels for all Ford and Lincoln Mercury ISM's to interact and communicate directly with the Ford Digital marketing team in Dearborn... And, to support and compliment all the technology tools, channels and communication mediums there are 18 regionally based 100% Ford paid Digital Marketing Consultants that visit 18 different Ford dealerships in person every work day of the year (minus a couple weeks vacation and conferences that Ford send them to). My team at ADP Digital Marketing supplies the consultants for the Ford DMC program, but they are 100% dedicated to Ford and the dealers and ISM's in each of their assigned Ford Regions.

You will not see too much written or publicly announced by Ford about these Digital Initiatives because Ford considers them to be a competitive advantage, therefore they shun the limelight in regards to their leadership in these areas. But, given the clear and focused subject you brought up, I felt compelled to share just a few of many program information points that every Ford dealer has access to. Within the FMCDealer.com Ford dealer information and communications channel, there are complete details and tools available to every Ford and Lincoln Mercury dealer that are unmatched by the rest of the OEM's doing business in the USA. For example, Ford tracks every lead and reports the disposition of those leads to every Ford and Lincoln Mercury dealer... When ABC Ford receives a lead from Jjohn Doe, and John Doe subsequently buys a new Ford from XYZ Ford 15 miles away, the original lead receiving dealer, ABC Ford can see exactly where, when and what the customer purchased. As a Ford dealer or ISM you can use the Dealer Lead Reports to see if the leads you are receiving are bing sold by any particular competing dealer in lesser or greater numbers than other dealers, and if the customers are being switched into different models than what the original lead inquiry referenced. Again, I am not suggestion perfection, but the people who work for Ford's Digital Marketing team in Dearborn have been improving and refining their programs and dealer support for over ten years and continue to do so on a daily basis.

When Ford saw that many dealers were buying outside supplier web sites to get additional features, Ford Digital marketing worked together with FordDirect and selected ClickMotive to supply a comprehensive customization package, including powerful video marketing capabilities which at $395 to each dealer represents an outstanding value.

I would love to talk about the Ford and Lincoln Mercury Digital Advertising program for dealers (FLMDA) which is administrated by ADP Digital Marketing, but that would come off as too self-serving and the genuine purpose of my response is to simply say that although many OEM's have great programs in place, there is one OEM that truly exceeds all the others in breadth, scope and flexibility of their dealer website and digital marketing programs for dealers, and that OEM is the Ford Motor Company. Other OEM's have a long way to go in catching up to Ford in this area, and although the specific names will be kept confidential... Many OEM executives have confided in me that they would like to do "this or that" digital initiative, saying "like the way Ford has it set up..." truly a compliment to the digital marketing professionals in Dearborn, but one in which I wish more Ford and Lincoln Mercury dealers would appreciate.

Lastly, I enjoy working with all the OEM's and there is not enough space to talk about Honda's dealer web site certification program, which is excellent in several respects. Or, how about Mazda's newly created program to supply various OEM powered widgets and applications on a plug and play basis so that dealers can incorporate them into any, or multiple web sites... The Mazda program is sheer genius and other OEM's could learn a lot from their unique and first ever approach to supplying web based ASSETS instead and mandating a particular web site supplier. Personally, I think the new Mazda programs are the best solution yet to an OEM providing dealers with dealership website tools, without force feeding a particular supplier, while ensuring a positive consumer experience with accurate OEM brand and model information.

 

[ehoopman]

Great Post Alex!

I just recently spoke about this on an AutoSuccess podcast. There are definitely a few of us Vendors out there that work hard every day to maintain OEM compliance while showcasing the dealerships individuality and providing solutions that are relevant to their market.

It still blows my mind that OEMs go to One Vendor mandated solution. I think it loses the spirit of innovation and, more importantly, the competition.

Also Ralph, Great call with the Mazda program take. Hand selecting the best tools from the industry, testing them and making them available to their dealers is the way to go. We ran a 6 month + pilot program to evaluate our coupon system before finally getting the stamp of approval. Now their dealers have one more valuable tool that they opt to seamlessly plug-in or not to their website.

Final take.. I strongly believe that a Recommended Vendor program with standards controlled by the OEM, as opposed to a One Vendor Mandate, is the way to go. As a vendor, if you've got a great product, can demonstrate that it's compliant, and it meets certain standards - your company can qualify for a "Recommended Vendor" status. If your product falls behind or doesn't maintain standards - you risk losing your status. This is more than enough incentive to get Vendors to maintain the highest in quality standards.

Put us to work OEMs, let us duke it out with creativity, innovation and service. I guarantee you will be pleased with the results..

 

[JS]

Great Post: These are all valid comments suggesting a free and open system based on compliance to standards would be best for dealers and OEM's. The OEM's predisposition to choose just one vendor to interface with dealers using an already outdated model or a pre-selected template of package choices has and will continue to impede innovation. In the end, the vendor loses the edge and the cutting edge dealer is left paying for 2 sites. It used to be that R&R and ADP bought the competition and moth-balled them, it even took them some time to face the reality of the ease of the end- arounds possible with their "closed" architecture using the linux data on the internet. OEM's should confer with the best of the best vendors and dealers and e-commerce legends to set the guidelines on branding and monitor the compliance as necessary to allow linking from their sites or receiving their leads. In addition, it's important to stay current and keep modifying the guidelines and allowing new vendors to present add-ons to better the end product.
Last, while many dealers do understand the "e-commerce department" , many senior OEM regional people are used to interfacing with dealers and GM's and not e-commerce people, as a result, they are a couple clicks removed. It's a mutual loss that rarely is discussed at the proper level.

 

[Richard (blog)]

Internet is advertising much like TV, Radio and Newspaper.

While the OEM's should control their brand and require dealers follow guidelines to protect their brand, they should not restrict the dealer.

Dealers spend thousands of dollars each month promoting the brand in their marketplace and the Internet should be no exception. Could the OEM's survive on national or regional advertising alone. I don't think so.

It's the dealers that are at the end of the distribution chain and it's the dealers who ultimately sell the cars.

The more they support their dealers instead of creating adversarial relationships, the more sales they will make.

Simply put, if you empower the dealer, it breeds innovation and competition and ultimately more advertising at the local level.

The more the dealers compete, the more the message gets out and the more cars they sell. Who wins? The OEM.

They should put their resources into educating the dealers on effective Internet marketing instead of wasting dollars trying to figure out how to do it for them.

Dealers know how to sell the cars. Show them how to utilize the Internet, give them web based assets and turn them loose in the marketplace.

It's called empowerment and it works.

 

[Nick Cybela]

It'll be interesting to see how many OEM's mandate a specific dealer website provider. I watched with horror and amusement when BPG came in and required us to use a website that, from their own admission got 2 leads the entire month from a #2 store in the Midwest opposed to our site that was getting over 10,000 people / month and had strong advertising behind it, along with a great conversion rate (and was in compliance).

While there's something to be said for brand recognition and congruity throughout dealers websites at some point restrictions make everyone equal, which is a loss on the dealer's end of things. That's one of the reasons we made a huge investment with a design agency, to create a branded identity that was different. Most of the brands, after a longer discussions were willing to support the new initiative and it paid off with a 300% increase in leads (along with some additional strategic advertising, of course).

I believe it'll be important for OEM's to balance. Dealer without the interest or resources to invest in digital savviness would absolutely benefit from the mandates and restrictions, but dealers that "get it" are actually hurt by those same rules. While impossible to scale there should be some process of appeals for those that make the investment into true superlative online performance.

 

[Mitchell Brenner]

There was a time not long ago that I was extremely negative towards the OEM's involvement with our websites and I always had a separate website that I would promote and one that just linked from the OEM site. Mercedes is a perfect example of an OEM who's website solution at this time is not very useful with one template and no real ability to distinguish yourself as an individual dealership.

My thoughts were recently changed by the Acura program launched with Dealer.Com. There's plenty of choice as far as templates and editable areas so no two websites should ever look the same but it also has all the OEM info, specials etc. that a dealership would need. I also find the SEO work to be outstanding where Mercedes-Benz' was non existent. I am completely happy, and surprised, with the way Acura and Dealer.Com handled this solution!

 

[mikedececco]

Mitchell:

Thank you for your kind comments. The manufacturer programs that Dealer.com is involved in are always dealer-centric. Acura has been a fabulous client and truly understands that the dealer needs flexibility to get their individual branding out there.

Manufacturers are understanding that their tier 1 messaging and branding is often lost as the customer moves down the chain to tier 3 (dealership websites) where the transactions finally occur.

The Manufacturers that are moving towards corporate programs are not engaging in these strategies because they want to "control" the dealership. Most are creating solutions that allow the dealership tremendous flexibility to market their own brand while still maintaining the branding and national incentive programs the manufacturer has spent millions to achieve and run.

The cost savings to the dealer for manufacturer programs is also incredible. The economies of scale that dealers can enjoy when participating in a manufacturer program are many. The manufacturers out there now that are creating new programs have learned a tremendous amount from the flexibility failures and dealer base push-back in the past.

Dealerships are truly becoming "Internet Dealerships" and they have advanced to the point that manufacturers are understanding that they can be more effective with a manufacturer website program that includes dealer flexibility.

Also, the manufacturers understand that there are still dealerships out there that refuse to engage "all in" on the internet. They have an outdated website, are doing nothing to engage with consumers online... This doesn't mean that the consumers in that market aren't using internet right? How does the manufacturer ensure that someone shopping their brand in a market with a sub-par internet dealer get the message they are spending millions to put out there? A strong manufacturer website program is a great alternative for those OEMs to fill gaps in their marketplace.

All in all, if done correctly with a dealer focused approach, Manufacturer website programs can be a win-win for the OEM and for the dealer. We're seeing incredible results with Chrysler, Subaru, and Acura.

 

[Colin Tychonski]

Well Nissan requirements for websites, is very difficult, they are trying to make all Nissan dealers be carbon copies with no individuality.

 

[Jason Ezell (blog)]

Excellent conversation and engagement. Obviously the topic is important and there are varying opinions of what measures "success". I agree that dealers should have a choice to choose what products best fit their Internet strategy. But I also agree that OEMs should take an active role in helping dealers find the products that actually work the best for their definition of "success". When you say the Acura deal has been a huge success...how is that measured? From your perspective as the vendor? I have had Acura dealers leave, sign up with the endorsed Acura providers, only to want to return three months later due to the drop in leads. So Success for us is measured just as a dealer would...lead to visitor ratio.

Although, vendors use different ways to calculate this number to show the "best results". For example, many web vendors show lead to visitor ratio as the number of leads from total unique visitors. But they remove shoppers who have been to the site multiple times from that equation. So the lead to visitor ratio looks higher for competitive purposes, but it's not accurate. Be-Backs are much more likely to send a lead so the lead to visitor ratio should include be-backs in total visitors. This will make the lead to visitor ratio appear smaller, but it is more accurate.

Another prime practice for web vendors is to show dealers a Site Index search on Google. This can be done by typing into Google "site:www.mydealerwebsite.com" this will show you how many times Google indexes your site in their listings. As long as your inventory is spiderable, then it's indexable and each unit will show up in Google as an "index". Now perform the same test put a space between the ":" and the website address. What happens? The number of "listings" shoots up to the 10s of thousands. This is completely irrelevant because what this does is show how many times a particular work within the URL shows up. For example if my dealership name is EZ Motors, and I do a listing search in Google putting the space between the ":" and the web address, it's going to show me every site that has any combination of "EZ" and any site that has the word "motors". So if a local company is named EZ Lawn Care, they will also show up in that number.

Back to the original conversation…OEMs should be the sniff tests for these dealers to “sniff” out the vendors who do use the best practices, the best tools but mainly the best information to help educate dealers on how to use all of these tools to their advantage. As OEMs and Vendors, our main goal should be to give the dealers everything we can to help them sell more cars. After all, where would any of us be if dealers don’t sell more cars? Mazda has done exactly this…the philosophy is to bring as many legitimate tools to the table that actually help dealers sell more cars. Having worked with a large domestic OEM on this same subject, I walked out because the OEM’s statement to me when I questioned their Internet strategy was… “All we are trying to do is sell people on the brand, it’s up to the dealers to sell the cars.” This is a perfect example of the OEM and Vendors not having their goals in line with the dealers. Mazda’s focus is on selling cars period, so they went our searching for the companies that are best at just that; the steak not just the sizzle to borrow an abused phrase.

I guess in short my point is to say that any OEM can have a successful Internet strategy with their dealers ONLY IF, the OEM and Vendor have a mutually aligned goal that is in direct relation to the goals of the dealers. Where every tool, every decision, and every new idea is critiqued with one guiding principle: does it help sell cars? In this new economy and new financial environment, if we are not ALL committed to selling more cars, the next recession will take even a larger toll