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Edmunds as 3rd-Party Lead Provider -- Thumbs Up or Thumbs Down?

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#21
Jeff, I believe that you are talking about lead sources in general and not specifically Edmunds because they have a monthly charge and not by the lead.

Brian said that Edmunds dropped his rate from $3500 to $2500. At the lower rate, that is $625/sale. To get to the $25 per lead, Edmunds needed to send him 100 leads. One of my Lexus stores was signed up at $1100 a month. We had 5 leads and zero sales. None of these leads had a phone number and all of them had a suggested selling price, from Edmunds, that was thousands below my actual cost.
 
#23
Jeff, I may be wrong, but as I recall, the issue was that Edmunds started with exorbitant "territory" fees - as in people were paying $1200-$1500 per month for those 10-12-15 leads. Now I know, in our case, we were able to negotiate a reduction after a few months, but (and again, my memory may be out of whack), but I seem to be thinking leads were closer to the $250 per lead mark than the $25 per lead mark. And even at half that price, Edmunds was still waaaay out of whack.

For the 3rd time -- it's been a while since I was in the store... things very well may have changed. I'd be interested to hear what dealers are paying per lead for this service now-a-days.
 
#24
Ahh, well at 250 a lead - the calculations are going to come out much differently. I'll see if I can't get someone from Edmunds to stop by and throw some light inthe cost of the different packages. I'll see what I can do but no promises. Many times different vendors are quick to place pricing in black and white do to having different prices across different regions.
 
#25
Jeff,

Customers are able to book out a vehicle invoice on Edmunds. The problem, with the Lexus customers, that value could be over $3000 less than our actual cost. Customers would add options where their was a prerequisite package or option without adding for those. Add the over $500 for local advertising and we have a serious problem. Anytime I heard Edmunds, I had a serious CSI issue.
Starting at $3500 in the tank, I wouldn't want their leads if they were free.
 
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#26
Hi All,

Caught up with this thread recently and wanted to take Jeff’s suggestion and see if I can clear up some of the questions and misconceptions regarding our Premier Dealer Program. Sorry it took a little longer, my profile seemed to be purged and I had to re-register.

  • Edmunds provides high ROI:
Thank you to the posters who mentioned we have high quality leads. Edmunds.com has been sending the highest quality of customers into the digital departments of dealers for years. Cutting out the middle man by going direct to the dealers is our latest evolution.

Some of our pricing was set on historical numbers delivered into the market, and others based on market forecast, as we are reflective of the wider automotive market. OEM sales changed, we completed a full site redesign, and now 25% of our traffic is on our mobile properties, which are not yet included in our reporting. So, you can see how the changing digital space can also change expectations and tangible results.

With the new Premier Dealer Program offering a Trackable Phone Number, a Click Thru to the dealer’s site, Chat, Live Advice, Interactive Map & Directions, and Mobile, the consumer is offered many more engagement points than just an old email lead to reach a dealer. Consequently overall consumer contacts to dealers from our Tier III space are UP!


  • No 3[SUP]rd[/SUP] party aggregators:
There was a concern that the leads go through aggregators before coming to you at the dealership. We do not send any of our email leads through ANY 3[SUP]rd[/SUP] party aggregator (Dealix, AUSA, ABT) in areas where our Direct program is available.


  • True Market Value® as negotiating tool:
True Market Value is based on a regionally adjusted average of sales prices of a vehicle. It’s not a “lowest price” number, or “appraisal,” like some other sites. It’s derived from actual sales. Since inventories have been relatively tight compared to four years ago, I think you’ll find that TMV® can be a great 3[SUP]rd[/SUP] party price validator in your customer negotiations, since overall front-end gross numbers have been stronger since then.

A vast majority of dealers who have joined our program have been very happy with it. We strive to tailor-fit the Premier Dealer Program to your needs, and we are looking for dealers to be true partners with us in this venture.

I hope this clears up some of the questions out there. As I know many folks on DealerRefresh, please feel free to reach out to me directly with any questions.

Good Selling!
Johnny G
 
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Dominion DMS
#27
jgiamalvo said:
  • Edmunds provides high ROI:

Thank you to the posters who mentioned we have high quality leads. Edmunds.com has been sending the highest quality of customers into the digital departments of dealers for years. Cutting out the middle man by going direct to the dealers is our latest evolution.


  • True Market Value® as negotiating tool:
True Market Value is based on a regionally adjusted average of sales prices of a vehicle. It’s not a “lowest price” number, or “appraisal,” like some other sites. It’s derived from actual sales. Since inventories have been relatively tight compared to four years ago, I think you’ll find that TMV® can be a great 3[SUP]rd[/SUP] party price validator in your customer negotiations, since overall front-end gross numbers have been stronger since then.
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Reading back through this thread I don't see anyone that agrees with the ROI claim. It wasn't my experience.

Negotiating tool? I will start my negotiations with the next Edmunds representative with this offer: We will sign up but you pay the dealership $3000/month for the privilege of selling me. You can make up the difference in volume.
 
#29
JQuinn said:
A simple answer to a simple question would be nice: what is the average territory price/cost and how many leads (REAL, measurable contacts) does the program deliver?

Aside from all the political blah-blah, there are some real answers -- what are people seeing?
Click to expand...

In my opinion, the biggest hurdle with Edmunds is that they do not have a sound pricing policy. When they launched, they came out to every dealer threatening that if you didn't sign up right away, you would miss out because they only accepted 40% of the dealers. This put up a red flag right away.

As that didn't work out as expected, they are now charging slightly less (and I emphasize slightly) without exclusivity. I couldn't help but wonder what happened to the folks that got suckered into the first round.

Edmunds shoppers usually fall into one of two groups: the low ballers or the heavy researchers. I can deal with the latter, but I don't think any of us really want the former. That being said, it is a valid site

With all the competition there is today, Edmunds is just pricing themselves out with their outdated model. They claim that their goal is not to be a lead provider, but to provide a place to give someone can get info and they then offer a lead to a dealership when the customer asks, and we are being told this is not a money grab.

Here are my thoughts on what happened, and I am probably wrong. Edmunds was providing new car leads to oems that paid them a small amount. Their used feed was being provided by Autotrader for which I assume autotrader was paying them to increase their broadcast range. It all changed when Cox Communications bought kbb.com and decided to pull their sibling autotrader out of edmunds and feed into kbb.com instead. Now they were left with just the oems that weren't paying them much so they dropped the oems. Perhaps they approached other 3rd party vendors to supply a used car feed or they decided that they were tired of getting involved with a middle man. So they hired a sales staff, and sent them out to dealers using, what seemed to me, Autotrader pricing (before the hike). Call me crazy, but this is how I perceived it.

Getting back to adjusting the model: While they are an "established company", they are new in working directly with dealers. I think most dealers would actually prefer to pay per lead rather than just write a check every month and hope they get results. I would rather pay 20-30 per lead knowing that I am actually getting something measurable rather just trusting that people are coming in because of dpv's or zipcode mapping. While I agree that 80-85% of traffic from these sites do not send an email or make a phone call, that doesn't invalidate lead generation as a measuring tool. If they are so sure that they are going to provide X number of leads, charge per lead.

(remember when the internet was supposed to save us money in advertising?)

In regards to JQuinn, We were quoted recently around $2500+/-. I think it was originally $3K+/- from what I remember initially.
 
#30
Brian Marchini said:
In my opinion, the biggest hurdle with Edmunds is that they do not have a sound pricing policy. When they launched, they came out to every dealer threatening that if you didn't sign up right away, you would miss out because they only accepted 40% of the dealers. This put up a red flag right away.


(remember when the internet was supposed to save us money in advertising?)

In regards to JQuinn, We were quoted recently around $2500+/-. I think it was originally $3K+/- from what I remember initially.
Click to expand...

Brian, they obviously have a different pricing structure based franchise, market, or maybe what they feel they can get. One of my stores was already signed up with Edmunds when I got there. They were paying less than half of what you are talking and I couldn't justify it.

The internet is still the most effective and cost efficient advertising tool ever available to a dealership.

AutoTrader says that roughly 65% of internet shoppers will not call or send a lead. We still generate traffic from this group but most of us don't get paid on it. I have been fortunate to have worked for people that understand this. My budget decisions were based on the ROI report where I could verify sources that actually generated leads and phone calls. I may have cut sources that generated floor traffic but not leads and calls ...who knows?
 
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