How much do you spend on marketing for 3rd party market places?

[BillKVMotorCo]

Think about how shitty it is to buy a car as a civilian. Especially for nerds like me that will make lists in spreadsheets and compare everything. All that goes away. Red-eye late night looking through 300 cars is gone, poof. Just the perfect 4-5 all wrapped up, ready to act on. I don't see how the status quo lasts much longer

From a dealer perspective, the first thing I see when I think about AI doing the buying is margins shrinking even further. As some point, that has to give, too, right? We're starting to hijack this thread with a slightly different topic, though.

 

[jon.berna]

I think it's perfectly relevant. @Carsten is on a mission to create new value in a space that is dominated by 3 companies. To do so he will have to have a divergent approach. The AI conversation is quite topical as everyone has to face the reality of how this impacts designing customer experiences. Searching for a car is just screaming to get a fresh design. So I am not letting the cat out of the bag, a good 50 companies are on this thought train positioning themselves to be the answer.

In terms of pulling it off, there will be 5-10 companies that execute well, build some cool shit, blow up and then later on get acquired and bolted into a larger platform that multiplies their value. Who's going to be those companies is a good question. People focused on making the status quo search experience 3-6% better will not be the 5-10. It should be 3-10x better.

The margin question is a fair one - but you can use these tools as well. For every 1 customer facing tool there will be a multiple of dealer tools to maximize profits.

 

[JDHigginbotham]

I agree with Jon’s take on balancing granular capabilities with steps asked for in the experience. Every click or request counts.

Now, for the car nerds like me..I WOULD go deep with a GPT chat or questionnaire that helps me avoid exactly what Jon described with spreadsheets.

I would have saved a ton of time and effort if a site/service could have explained to me that an f150 XLT fully loaded + dealer installed leather was $5k less than getting a Lariat just for leather

 

[BillKVMotorCo]

I would have saved a ton of time and effort if a site/service could have explained to me that an f150 XLT fully loaded

This is my point, though. Customers don't really have a clue what "fully loaded" means. And you may know what that means, but my Grandma probably has a different idea of what "fully loaded" means. Also, customers are always blown away when we mention adding leather instead of going higher on trim. They don't know that is an option and they don't even realize how trim levels impact the leather aspect to begin with. They don't realize that when they go to an LTZ Silverado that the only thing they may want over an LT is the leather.

 

[jon.berna]

If I wasn't doing the vendor management thing which I love, I'd be on this idea. It's really exciting time to be in auto tech.

I don't think the industry fully understands the impact this will have yet. This will entirely bypass the marketing infrastructure. When users don't shop and the applications do audience based marketing is gone, overnight. I spent 10 years on audiences and understand the tech enough to know it's irrelevant for this approach.

Every company building amazing CDPs and ad tech that's onmi-channel..blah..blah..blah... worthless with this structure. The humans are disconnected from the manual labor of creating a wake of engagement.

It has a few potential outcomes. If the customer is air gapped away from the browsing / shopping with no breadcrumbs behind them. The audiences will get smaller, in terms of # of humans. The services may sell audience data to promote or recommend certain vehicles but I think this defeats the point. The ads are a byproduct of a tedious process. The service that is focused on winning for the customer only, is what customers will want.

Ads will impact the type of cars the customer asks it to acquire, so that remains unchanged. I can see a chasm forming between the initial queries and the decision the customer makes, that used to be filled with engagement data. The industry has used audiences to bridge the gaps between tier 2 and tier 3. So this will get harder for them with the big blind spot at the end.

 

[JDHigginbotham]

Also, customers are always blown away when we mention adding leather instead of going higher on trim. They don't know that is an option and they don't even realize how trim levels impact the leather aspect to begin with. They don't realize that when they go to an LTZ Silverado that the only thing they may want over an LT is the leather.

This, though, requires the customer to be so far down funnel they are at least reaching out to you to discuss options.

If they are at the dealership, we’re at the mercy of the LT they would accept being on the lot.

Enter persuasion, I know. Humor me.

I think about all the reasons my buying process would be delayed without this insight earlier in the journey.

I’m thinking I err on bringing the guidance a dealer can provide earlier..accelerating the purchase journey.

Basically, how much sooner would they have become an active shopper if they didn’t waste 8 hours looking at LTZs they aren’t going to buy?

If there is a host of reasons I’m wrong, I guess we’re back at the merry go round of why people don’t reach out to the dealer early.

 

[BillKVMotorCo]

The margin question is a fair one - but you can use these tools as well. For every 1 customer facing tool there will be a multiple of dealer tools to maximize profits.

Will just be interested to see how the AI decides what a good buy is. Continuing the search discussion, if the customer puts bad data in, how would the AI know any better? What if the customer forgot to mention they wanted a heated steering wheel? What if they thought an LS has leather? Further: How will it decide value over price? Will it value dealers who respond quickly and accurately like actual customers do? Will it be able to decipher condition based on pictures? New body style from old body style? Will it decipher dealer lots from buy here pay here lots? Light blue from dark blue? You get the point.

 

[jon.berna]

Will just be interested to see how the AI decides what a good buy is. Continuing the search discussion, if the customer puts bad data in, how would the AI know any better? What if the customer forgot to mention they wanted a heated steering wheel? What if they thought an LS has leather? Further: How will it decide value over price? Will it value dealers who respond quickly and accurately like actual customers do? Will it be able to decipher condition based on pictures? New body style from old body style? Will it decipher dealer lots from buy here pay here lots? Light blue or dark blue? You get the point.

I think with enough at bats all of those questions will get resolved. I think the more likely setup is what's referred to human in the loop. So the app is discovering potentials, getting reactions from the user and refining results based on their responses. The customer is driving, but is disconnected from the effort side.

 

[BillKVMotorCo]

I think with enough at bats all of those questions will get resolved. I think the more likely setup is what's referred to human in the loop. So the app is discovering potentials, getting reactions from the user and refining results based on their responses. The customer is driving, but is disconnected from the effort side.

Just trying to think of the most human or "gray area" stuff I could think of. Ha.

 

[jon.berna]

Just trying to think of the most human or "gray area" stuff I could think of. Ha.

Here's two:

• Apathic dealerships that create human only policies --> that's if they could figure this out.
• The classified sites, dealership sites, restricting scraping and not sharing their data --> Don't see how effective they could be at this and not hurt everything else that relies on it, which is a ton.

Another thought the customer would take out all their unrealistic expectations on the app versus the dealer. They would be fully aware they have a good deal by the time they purchase. I could see CSI actually going up.