Pricing Games on Classified Inventory Websites

[David K]

The way the life style has changed, dealers need CARS.com and ATC more then Cars.com and ATC need dealers. When you go shopping for a vehicle do you go driving from state to state or move the mouse website to website? Which is easier?

This is why it is so important for these companies to enforce the policy. i know from buying 4 cars through cars.com they do a swell job.

 

[Jorge (blog)]

I've worked for both companies and they do enforce it when the dealer is caught. It's impossible to monitor all listings. Most are caught when dealers report their fellow dealers cheating. Customers are wise to this. The click percentages are significantly lower on "over priced" cars such as the ones dealers list for $99,999. Consumer behavior is to scroll down to the actual market price and start shopping. The click percentages are actually lower on the cheapest vehicles. 60% of all searches, customers enter a price range. Therefore, if you have a vehicle listed without a price it won't even show up 60% of the time. Also, if it is listed extremely high it also won't show up on 60% of the searches when the customer enters a price range.

 

[Cargurrl]

Alex BHPH is less that 2% of Autotrader.com's business so I am not sure where you get your information from.

 

[Alex Snyder (blog)]

I don't have ATC's make-up, but when I go on the site I sure do see a whole lot of BHPH stuff. If it is less than 2% they're sure getting a lot more than 2% for their money!

 

[William Bryant]

Silly... my old used car manager used to want me to do that stuff.

But I'm almost glad they're still around, because when those customers get burned they come to me!

 

[Ryan Leslie]

William is right on. We do attempt to police this kind of stuff, but the reason why may surprise you.

The dealerships that use classified sites in this manner are usually the first ones to cancel. The buying cycle is at 90 days and the consumer trend is to utilize classified sites throughout the entire cycle( see the NYC Google Summit post). By the time the consumer is ready to buy the dealership has marketed themselves right out of contention. The consumer doesn't want to play the old school games, otherwise they would have gone straight to the showroom with "red" being their only qualification. I know we still switch people, but you are far more likely to hear a stock number at the greeting than ever before. The consumer is better educated than ever. They see through the gimmick on one listing and don't click through any other listings returned in search from that dealer.

Point is that the dealerships that use these tactics eventually don't get the same kind of results that an upfront dealer will get and they cancel. We police this in order to retain customers.

 

[Glen Garvin]

To Toby's point earlier, there are still all kinds of games being played. I wonder what percentage of dealers still keep stale inventory on-line trying to generate leads only to respond, "that car was just sold, but come on down... " when they don't have anything very similar to that vehicle?

 

[Craig Belowski]

It is amazing that although the number of truly transparent customer-centric dealerships has increased over the last few years, the number of gold chain wearing, fast talking, shell game playing salespeople and more importantly sales management seems not be going away quick enough. There is a reason the latest automotive industry buzzword is “Reputation Management” instead of “Reputation Creation.” It’s too bad for those of us that love being in the car business, but hate the reputation created by the likes of those with shady advertising practices. With the combination of truly forward thinking internet sales managers that now ALMOST have the ball in their hands, but are still subject to a one way thinking “how can I trick a customer today” boss pulling the strings I think we will see more of these tactics. Until the people responsible for leading a store understand that you can only “Reputation Manage” your way out of poor reputation creation for a short time before customers see right through it.

 

[MBR Marketing Auto Dealer Supplies]

Honesty and openness is the best policy. Misleading pricing may result in more calls for some dealers, however in the long run those who conduct business in an ethical way win.

 

[Alan Bechler]

Is it really up to the classified site (or any advertising venue) to police these dealers? I sold newspaper advertising to dealers and this was standard practice for years to put the real deal in the fine print. ("Used cars at $49","Double rebates", "Guaranteed $$ for your trade") Classified sites host dealers listings. What dealers say reflects on them and state and federal laws regulating automotive advertising. Car buying is, and always has been a "negotiated purchase" like buying a house. It IS fair to try and clean up these practices when the dealer does it--but it shouldn't be up to the advertising medium to police these practices. Buy Here/Pay Here customers know their credit situation and know it costs them more to do business in most financed purchases: credit cards, housing,and car buying. Yes, these shady dealers will always do it and, as usual, it will reflect on the overall reputation of car dealers in the eyes of the public.