Look-Out AutoTrader and Cars.com, There's a new Guru in Town

[Joe Pistell]

Marvin writes: "...Would you advertise in a paper if the publisher insisted on prominently placing their opinion of your pricing in your ads?"

Batten down your doors Marvin... Internet Technology is knockin'.

Maybe you should have a chat with your GM and let him/her know how pissed you are. Be sure to call on your new 4G iPhone so you can have a live video conference with your GM on his iPhone so he understands how pissed you are. Your GM will check CarGurus.com on his iPad that's hooked to your stores wireless LAN that gets to the Internet via FIOS. (Sorry Marvin, I can't help myself sometimes... I'm a sucker for sarcasm)

Marvin, This is just the 1st shot over the bough. More will come. vAuto paved the way, demonstrated that it's possible and elected to sell the data to dealers.

GIGO (Garbage In, Garbage Out).
CarGuru's missing trim/package data keeps the comparison results from being 100% true (you can thank lazy dealers for that... but thats a whole 'nother subject .

I am ready for battle, but the carguru.com leads come to us BLIND and the shopper thinks we know what he knows... NOT A SNOWBALLS CHANCE IN H***.

Shopper has his CarGuru.com printout (we're $1700 high), we give him a trade-in offer, shopper drops the "Guru Bomb" on the deal and a fire fight erupts.

All the Dealer knows is the leads came from ______(insert 3rd party lead seller's name).

Not Smart.

I am 100% aok with it all until the lead hits us without the "Guru Shopper" warning. Heck, we could be $1700 under and we accidentally give away the house when we didn't need to.

CarGuru is all about transparency, let's finish the job, transparency all the way to the end!!

CarGuru Execs take note!!

"Don't Bite the Hand that Feeds You!"

 

[Joe Pistell]

If you're trying to reach me, Please don't call my stores (I work from Home !!

Try: http://www.linkedin.com/pub/joe-pistell/14/726/41...

or my gmail accnt: joepistell[at]gmail.com

 

[DennisGalbraith]

Fantastic analysis Joe!

For now, dealers need to put the name of their store on the lead photo (thumbnail photo) of every vehicle. Just the store name, big enough to be legible in the thumbnail. Magic City Ford in Roanoke, VA has the right idea. About 1/3 of the traffic coming from used vehicle listings never phones, emails, or chats. Give your customers a chance to know your good name is behind the vehicle and where they can walk in to see it.

As good as this site is on SEO, it is equally bad on sales integration. The demonstration is poor. The seller’s notes appear to cut off at 778 characters (926 with spaces). Cars.com allows up to 2000 characters, plus another 2000 in the batch tag line. The shopper will never see most of it. The pictures cut off at eight. Cars.com provides up to 32. If CarGuru provides video, I have not found a single example of it.

These things are fixable, but the site is not going to generate a lot of consumer loyalty and advocacy with a lead generation model, no chat, no map, no directions, no address, and trickle poor demonstration of the vehicle. My guess is that over 80% of the shoppers visiting this site leave and visit Cars.com and/or AutoTrader.com. SEO gets shoppers looking, but you still need to get the shopper excited about the vehicle and let them contact the store any way they want to.

My new book, Sales Integration, will be out later this month. Unless these Ivy Leaguers read what this old boy has to say, they ain’t never gonna catch Cars.com and AutoTrader.

 

[Rob Fontano (blog)]

I wanted to do some research before commenting and in my opinion I think we are missing the elephant in the room.

The inventory hosted on Carguru.com is being supplied by several different agencies. These are companies that we the dealer are paying to display our inventory on their sites. Sites like Car.com, Vehix, Usedcars.com (Dealix) are just a few.

From what I have gathered Carguru.com is paying some of these companies for our inventory feed. Why else would a company like Cars.com or Dealix supply a competitor with an inventory feed, if that competitor had designs on beating the stuffing out of them? There must be some kind of symbiotic relationship between them that goes beyond what we the dealer sees on the surface.

In addition to that, the same companies that we are paying to host our inventory are spreading it all over the web to countless car sites. The end result is that not only are we guilty as dealers of allowing our inventory management companies to shot gun our cars to all the Vast’s and Oodles of the parasitic car shopping world, but we are also paying companies to sell our feed to the Cargurus of the world, and then having them sell it back to us. Not to mention the dilution of SERP’s, and a battle for organic search results in your own back yard for the very vehicles that you have purchased and placed up for sale in the hopes of making a profit.

Is this the third party lead providers game plan to counteract the organic SEO efforts that dealers are using for GPOM? We cannot assume that these companies are completely ignoring what Brian Pasch has been saying for a very long time regarding the third party and free inventory sites. They have to fight back to regain their market share of the SERP or they will cease to exist.

 

[Carol Weymouth]

Great article, Joe. I just read thru your Used Cars – CarGurus.com – vAuto and the Travel Industry forum and you are right on! The way I see it is cars.com has some vested interest in CarsGurus.com and cars.com is just trying to get more of the pie with yet another 3rd party website. Do you think the consumers are as confused as the dealers when they receive a welcome letter from cars.com after submitting an inquiry on CarsGurus.com?? So much for sourcing.

 

[Joe Pistell]

You nailed another one Carol!

"Do you think the consumers are as confused as the dealers when they receive a welcome letter from cars.com after submitting an inquiry on CarsGurus.com?? "

Great observation.

In Cars.com's defense, it's paying CarGurus.com for leads and NOT passing along the cost. Dealix re-sells them.

 

[ed.brooks]

Yet another extraordinarily insightful post. You always give a great analysis. CarGurus could be a game-changer and certainly represents another step in the evolution of online car selling.

They do face some challenges: While they optimize really well on market-specific long tail searches (Used Acura MDX near Boston), that's not how most customers enter AutoTrader.com or, I presume, Cars.com. Both of these giants have spent years and hundreds of millions building huge name recognition. During my time at ATC, I was privy to the data. A tremendous number of used car shoppers simply type AutoTrader.com directly into their browser. And then, for those customers that use Google, another huge number simply do a Google search for "AutoTrader.com". We have to assume that same goes for Cars.com. One problem for CarGurus is ATC and Cars have established themselves as THE pre-owned search engines.

All the research says retail customers love 3rd party sites. In large part, because of the ability to compare, side by side, cars from competing dealers. I fully respect that fact the you do a phenomenal job attracting shoppers away from the "Big 2" to look at your inventory without the competition right next to your cars. I also respect the fact you recognize that ATC and Cars will attract a (significant) number of shoppers and embrace those sites as well.

CarGurus needs two things: eyeballs and inventory. You can't get or keep one without the other. I searched "used Acura MDX near boston". ATC was #1 & Cars.com was #2 (organic). CarGurus was #8. The ATC link took me to 251 used MDXs near Boston, the CarGurus link to 94 MDXs near Boston and the Car.s com link to a generic national landing page. The number #3 organic result was FirstAcura.com with a great site from optimization wizards CapitiveLead.com.

If nothing else, CarGurus drives home the point that car shoppers love to compare. And they make it even easier than it was before. Having the right cars, bought right and priced right is more important now than ever!

 

[Jeff Kershner]

Cars.com and AutoTrader.com have a "Brand" that rivals can not currently compete with.

CarGurus will also need a brand to truly compete with the above rivals.

@Joe, I've been asking leads providers to be transparent on where their leads come from for years. Their excuses for not doing so have always been lame.

 

[Alan Ezzati]

Hi Joe,

In a field full of misinformation (automotive SEO) and snake oil salesman it's great to see and educated, empirically driven individual writing about topics that aren't even on most people's radar yet. Great article!

We too have noticed CarGurus.com for over a year now. We fully understand the notion of the small start up that's flying under the national radar quietly doing it's thing We are that! BTW Ed, thanks for the props.

CarGurus core application and their automated SEO is in a league of its own. The link structure, URL structure, geographic organization of various inventories, etc, are (in a single word)...elegant. To dominate the long tail key phrase means appearing at the top of the search results for A LOT of key phrases while showing up for short tail key phrases means show up A LOT for relatively few key phrases.

Currently, due to the elegance of the core structure and informational organization of their site/inventory they're doing exquisitely well for long tail. And as you said, once they get the Google quality team's blessing, they'll start competing (if not dominating) the short term key phrase game as well. Once that happens, the other retail sits (AutoTrader, Cars.com, etc) will suddenly find that they have a serious threat, not on the horizon, but in their back yard.

Next gen SEO has always been part of our core infrastructure which is why and how we've managed to dominate the long tail game for terms as competetive as "used honda accord boston" or even "used honda accord new england" etc. We're in latter phases of the next version of our applications which emphasizes heavily on quantum leaping even our own SEO game. Although the details SEO strategy of a retail portal are slightly different than that of a dealer's local site, the over riding principals remain the same. CarGurus is so far ahead of the SEO game, and the industry so very heavily reliant on SEO (including AutoTrader and Cars.com) that once CarGurus gets Google's quality blessing, brand or no brand, they will be a heavy weight contender and if I were in the retail game...I'd be very concerned.

When CarGurus hits critical mass and attains an organic yet signifcant brand, it's the equivalent of Mohammad Ali fighting George Forman.

Here's my two cents when it comes to the formula for the success of any auto retail portal:

Brand + Google's blessings + great site structure/relevance = Eat their lunch!

Thanks for a great article Joe, looking forward to more insights from you.

Best,

Alan Ezzati

Managing Director,

Captive Lead LLC.

 

[Joe Pistell]

My buddy Ed Brooks writes: "...that’s not how most customers enter AutoTrader.com or, I presume, Cars.com. Both of these giants have spent years and hundreds of millions building huge name recognition. During my time at ATC, I was privy to the data. A tremendous number of used car shoppers simply type AutoTrader.com directly into their browser... another huge number simply do a Google search for “AutoTrader.com”. We have to assume that same goes for Cars.com...."

I was going to write an article on this because I get a kick out of this cycle of madness.

AutoTrader and Cars.com claim to be the car shopping internet sites search engines, found exclusively on the internet. Yet, if you go down to the local bus station and ask some one, any one, if they wanted to buy a used car, where would they go, 95% of them would say google.

Summary: "Car Shopping Solution" = google.

Then, you look at how (and why) AT and Cars.com uses traditional media
https://dealers.autotrader.com/dc/portal/atc_port...

"Our big network media buys and local radio advertising drive serious shoppers to AutoTrader.com. Our broadcast exposure is one more reason AutoTrader.com is the largest automotive marketplace in the world"

AT continues: "Our TV Spot will be seen 2billion times by 147 million people"

Cars.com is right there running a parallel biz model: http://findingcarbuyers.com/

So... what do we have here?

Google is "the" search solution in a vacuum (aka search brand). AT and Cars uses TRADITIONAL MEDIA to drive traffic to its internet sites, where dealers all pile in and display their inventory in a highly competitive format, compressing margins to get looks that lead to sales.

Do you see the madness?

Ed, you were privy to the stats, the 2 largest classified sites on the planet get direct traffic only from traditional media. Oh and don't think for a minute that AT or Car.com has reached "Kleenex" status. Once the ad campaigns have stopped, People new in market will not remember to key in AT or cars.com, but will default to "the" universal search solution... Google

I'll say it again, Do you see the madness?

While we all abandon TRADITIONAL BROADCAST MEDIA Cars and AT are workin' it.