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

[Alexander Lau]

This sounds like something my Autotrader rep would tell me to try to take the attention off their declining performance lol

You are correct though, the data is only as good as how much we can trust it. To be fair, I'm sure if I asked CarGurus they would say they don't measure spider or bot traffic either.



I'm not seeing this at any of my stores so something definitely seems off and you're right to be skeptical. We still typically receive the most VDP views on Autotrader with CarGurus and Cars.com relatively tied for a close second. Granted every market is different, these are just nationwide averages.



I can see both sides here. Typically the more VDP views I have, the faster I will sell the car so my cost per car will remain relatively the same but my monthly cost will be higher because of a faster inventory turn.

However it would be nice if they implemented some sort of Google Adwords-esque Quality Score system that rewards dealers with a lower cost / vdp view who provide a better experience (better inventory, pictures, prices, etc) to their users instead of the same flat cost / vdp view for every dealer.

Your views and impressions are only as good as they convert for you, which is why you need a sales attribution tool.

@reverson I know you know that, just putting that out there generically. I probably shouldn't have replied, just put out a straight post.

 

[John Colascione]

I'm in the New York marketplace and what I have seen is a declining interest in both AutoTrader.com and Cars.com while a growing interest in CarGurus. It seems you are receiving less and less from the larger players while prices stay the same or increase. Then you have CarGurus who enters the market and in my opinion is really killing it in the marketplace (probably best product out there) at this point for used cars, but their tactics, with price increases and getting listed are very aggressive. Many dealers I have sat with have received these dreaded price increase letters and have pretty much been forced into paying the higher fees because there is a lot of traffic on the site. If you are in the free listings you're going to get a shit tun of teaser listings with very little contact details and once a rep contacts you they'll even turn on 30 days of premium of whatever and start sending the contact details, but if you do not sign up after multiple attempts, you just might disappear from the site completely. Especially if you signup and then cancel. CarGurus is one of the only real used car shopping portals which have built their business without boots on the ground.

 

[mbmotorsports]

Carguru's is back at it again. Only this time a different outcome. 60 days ago we received the letter. rate increase from $4k to $50K (exaggeration but not by much ) . I'm a big boy, I can deal with a rate increase. They suck but whatever. This is not a increase. This is a attack on my business! Take it or leave it MB Motorsports. No consideration that we've been a partner since 2007. No consideration that margin compression is squeezing our profits to a minimum. Just some random Dude on the phone saying that's the best they can do, no one else to talk to, he makes the decisions.

So guess what. We cancelled! Anxiety level was high but it kinda felt good! Like when you finally break up with that girlfriend that you know is poison. We've now been off the site for 30 days and we have had an amazing month. 10% increase over last years numbers. We haven't missed a beat! And guess who's calling and lowering their rate multiple times to get us back on the site? Yep, that random dude again. They claim i'm still getting residual buyers from when I was on the site. I might buy that if i didn't track my numbers monthly for the last 10 years and know for a fact that 95% of my internet lead sales are from current month leads.

Carguru's, we wont be subject to your predatory tactics. You hit us with a unfair rate increase, threaten to take me off the site while hoping to muscle me to take the increase. When I cancel, because i have no other choice, you then keep calling & negotiating the rate down. in 6 months my cars will be back on as free listings and leads come in with no info. then you try and get us back at a super low rate again. This is not the way to treat your customer! I will give my money to a true partner......

 

[Alex Snyder]

Is Cars.com the only third party site that doesn't just jack rates for the sake of jacking rates?

 

[Alexander Lau]

I'm in the New York marketplace and what I have seen is a declining interest in both AutoTrader.com and Cars.com while a growing interest in CarGurus. It seems you are receiving less and less from the larger players while prices stay the same or increase. Then you have CarGurus who enters the market and in my opinion is really killing it in the marketplace (probably best product out there) at this point for used cars, but their tactics, with price increases and getting listed are very aggressive. Many dealers I have sat with have received these dreaded price increase letters and have pretty much been forced into paying the higher fees because there is a lot of traffic on the site. If you are in the free listings you're going to get a shit tun of teaser listings with very little contact details and once a rep contacts you they'll even turn on 30 days of premium of whatever and start sending the contact details, but if you do not sign up after multiple attempts, you just might disappear from the site completely. Especially if you signup and then cancel. CarGurus is one of the only real used car shopping portals which have built their business without boots on the ground.

And it makes sense, while working in automotive attribution I saw similar trends. Although CG might be increasing their cost, their CPA rates were much better than their competition. CPA (cost per acquisition) is calculated by dividing the channel spend by the count of conversions attributed to a channel under a particular attribution model.

 

[John Colascione]

Yea, I’m pretty sure as far as CPA, they are the best gig in town. Amazingly, I think we need to admit that they have the market by the balls right now. That is why they can get away with the price increase demands. I’d bet that most companies that could get away with it would do it.

 

[mbmotorsports]

I've learned quite a bit since being off Carguru's for a month now. We are now receiving more leads from other 3rd parties and attributing more sales to them. We have not missed a beat and are having one of our biggest months in our 10 years in business.

Don't be so sure those CPA's are accurate!

 

[Alexander Lau]

I've learned quite a bit since being off Carguru's for a month now. We are now receiving more leads from other 3rd parties and attributing more sales to them. We have not missed a beat and are having one of our biggest months in our 10 years in business.

Don't be so sure those CPA's are accurate!

What do you mean by that? What works in Seattle might not in Miami. There is no such thing as a shiny red button solution when it comes to products like these. Your car buying demographic might not appreciate Car Gurus, but others might.

What I am saying, I've seen better CPA's for CG than their competition, just in general. That doesn't mean for all demographics.

 

[Tallcool1]

What do you mean by that? What works in Seattle might not in Miami. There is no such thing as a shiny red button solution when it comes to products like these. Your car buying demographic might not appreciate Car Gurus, but others might.

What I am saying, I've seen better CPA's for CG than their competition, just in general. That doesn't mean for all demographics.

I agree with you @Alexander Lau , different things work differently in different locales as well as dealerships.

@mbmotorsports Jesse, I respect anyone that will tell a vendor to pack sand when they just don't feel good about it. With that said, I caution anyone that micro analyzes a small pool of data. One month does not make a year. Sometimes we get busy because we get busy. Sometimes there is nothing that we have done to make it happen. I am finishing up one of the top 5 months my store has had in the last 8 years. Care to guess what we did to make this happen? Nothing. The only 3rd party site we are on is CarGurus. We have cancelled all of the others. No radio, no print, no direct mail, no retargeting, no paid search, no FB Marketplace, no Craigslist.....NOTHING. We got busy because we got busy. 120 days from now, if your metrics stay put, I would say you could begin to draw some conclusions. It's the observation of a that knows about 10% of what you know regarding digital. Take it or leave it.

 

[mbmotorsports]

I agree with you @Alexander Lau , different things work differently in different locales as well as dealerships.

@mbmotorsports Jesse, I respect anyone that will tell a vendor to pack sand when they just don't feel good about it. With that said, I caution anyone that micro analyzes a small pool of data. One month does not make a year. Sometimes we get busy because we get busy. Sometimes there is nothing that we have done to make it happen. I am finishing up one of the top 5 months my store has had in the last 8 years. Care to guess what we did to make this happen? Nothing. The only 3rd party site we are on is CarGurus. We have cancelled all of the others. No radio, no print, no direct mail, no retargeting, no paid search, no FB Marketplace, no Craigslist.....NOTHING. We got busy because we got busy. 120 days from now, if your metrics stay put, I would say you could begin to draw some conclusions. It's the observation of a that knows about 10% of what you know regarding digital. Take it or leave it.

What do you mean by that? What works in Seattle might not in Miami. There is no such thing as a shiny red button solution when it comes to products like these. Your car buying demographic might not appreciate Car Gurus, but others might.

What I am saying, I've seen better CPA's for CG than their competition, just in general. That doesn't mean for all demographics.

what i'm saying is that i'm now getting a better CPA from my other 3rd parties since i'm off carguru's.