Pricing Games on Classified Inventory Websites

[Jeff Kershner]

Dealers still playing the PRICE GAME on Classified Websites.

Are dealers still playing this game? ...ofcourse they are!

I was hoping this shit would stop as print continues to diminish, but it's obvious that some of the classified sites allow it to happen as well. Maybe it's OK. Maybe at the end of the day there really is nothing wrong with it. After all, its the customers responsibility to read the print..RIGHT?

As dealers struggle, it only makes sense to find that "trick" that gets the phone to ring, more leads into the inbox and more people through the front door "We'll deal with the objections once they're in the showroom"..right?

I just don't like it and think in the long run it makes it more difficult to brand your dealership as a reputable place to do business with. I also think it brings a bad image to the classified sites that allow this type of pricing technique to happen on their websites. IMO it's taking away from the "consumer centric" appeal and again provides a disservice to the customer.

What do you think?

Are you providing the customer a disservice by pricing your inventory like this on the Online Classified Sites?

Should the Online Classified Websites allow this type of pricing technique (knowing consumers initially search by price) ?

What are your thoughts?

 

[Bill_Playford]

It's these dealerships that are somehow going to stay, while others go. Maybe customers like being duped?

 

[Matt Watson (blog)]

I also see dealers list their inventory for like 1,000,000 dollars so they have the highest price and come up first. It's silly but it works. We have ex Internet sales guys on staff that used to over price used cars all the time.

 

[idkmybffamir]

Dealers are still even listing inventory without prices. CALL FOR PRICE. Online shoppers do not want to take that extra step. Or the 300-words-per-second narrator on radio ads.

 

[andwrig]

Jeff

I know cars.com has sent an email to its dealers (at least in my area) that misleading prices with down money in the fine print are not allowed and will lead to the listings being removed and possibly the dealer being blacklisted. IMO that is the best way to handle this situation so as to maintain credibility with the consumer. I don't know what Autotrader is doing but I am told they have a policy similar to cars.com.

 

[Toby Albergotti]

This is a great point. I am not a dealer but, I run into this with many of our Dealer customers. The pricing of cars becomes a covert war or a “paradox of choice”. Both of these practices I urge customers not to participate in.
Buy Here Pay Here Dealers & Secondary Dealers fall into this “paradox of choice” category. Ultimately they aren't putting any price hoping to get a bite...then not focus on the cost but on the ability to get the person in a car. In order to comply with law they cannot price a car & add the finance company's fee to the price at the time of sale. So if they price a car say at $5,995 which may be market price & then a customer that has a 390 beacon score wants to purchase the car…they are in major dilemma. The only viable financing can be made with a company that charges the dealer a $2,000 fee & then charges the customer the interest. Legally the dealer cannot tell the customer the car is now $7,995 plus you will paying the finance company. So the dealer must now figure out how to post a price on the internet that a good credit customer finds competitive, but what do they do in the case of the credit challenged customer that saw the lower price? Hence the “paradox of choice”… should I stay in compliance and miss leads or should I play games and get burned. This adversely affects the consumers, because the information in the market place is not as pure as it should be. Because many cars are not priced & consumers typically skip over cars with no price….their choices may seem more limited than they really are in many cases.
Pricing covertly by hiding money in other areas creates exactly what you elude to… customer distrust & long term failure on honest perception from customers. As a heavy internet consumer myself… when any company plays these games with me… they lose my business forever. Camera stores on the internet are infamous for this game… you Google an expensive camera and presto you will see prices on the exact same brand new camera all over the board…usually the cheaper price means the camera is not made in the US, has No warranty in the US, & the customer support is dismal. Point blank I pay more money for the companies that don’t play games & that provide me with great information on the “ins & outs” of the merchandise.

 

[Andrew DiFeo]

I mentioned this to my Autotrader rep last week that I don't think it should be allowed by their site, while he agreed, it sounded like there wasn't much that could be done about it.

I think Vauto/Firstlook should lobby the classified listing sites, as this type of pricing drastically reduces the effectiveness their services provide.

 

[Alex Snyder (blog)]

Toby Albergotti - one thing I can gladly say I don't know much about is the buy-here pay-here game. There are a lot of them in my neck of the woods (because of all the military here), but I have not tried to understand that part of the business. Fortunately, Checkered Flag rarely ever competes against them - we're the opposite end of the spectrum. Your post is interesting and makes sense. If I had a hefty bank fee, I'd probably be getting "creative" in my pricing too.

At the end of the day it is up to the website that allows this kind of practice to police it. I wonder if Autotrader.com is paying attention? Buy-here Pay-here's are a huge part of their income, so I doubt they'll do anything about it. THANKS to Cars.com for heading in the right direction. At the end of the day - it is about the consumer - not the dealer.

 

[Ad Hustler]

Yea...ok...like cars.com is going to blacklist a dealer. They aren't google. They need the dealers probably more then the dealers need them.

 

[Jorge (blog)]

There are 3 million vehicles listed on both ATC and Cars.com. It is policed and corrected when it is brought to their attention. Here's a novel idea...Dealers should start being honest with the consumer and we wouldn't be having this discussion.