FRIKINtech VIN Matching for Sold Attribution

Alex Snyder

President Skroob
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May 1, 2006
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Our engineering team gave us a taste of their first pass on matching sold records and offers we sent to service customers late last week. I've been chewing on it all weekend and thought it would be cool to journal my first impressions here. I plan to add this new stat to the ongoing Service Drive Equity Mining Stats thread after May closes.

How we do it:
Pulling closed service ROs from the DMS to calculate what customers/cars are in a situation the dealer believes is worth hitting with a "we want to buy your car" and "you can upgrade your car" types of offers. We then process the sold DMS feed to see if the VIN we sent an offer on became a trade later. And we continue to watch that VIN become a sale later (retail or wholesale). We have not applied any other matching logic than VIN matching. I know we're leaving stuff on the table because some of our dealers are telling us that.

Timing to watch for sales:
We plan to watch for the first transaction within 90 days of the offer being clicked on. With so many customers ordering cars we have extended that and will continue to play with the number of days until this market settles. We then watch again for the trade or acquired vehicle to be sold. This too is a timeframe we will continue to tweak.

Interesting things that have popped out thus far on YTD data:
The average time it takes someone to go from clicking the offer to actually trading their car is 20 days. Any predictions on whether this will change with inventory normalization?

The average sale price has been $57,300. Between highline dealerships and market adjustments, there are a few stores driving this way up.

The average front-end gross has been $2,690 and the average back-end gross has been $2,559 with a total average gross of $5,249 on the initial deal. When you combine the average gross on the sale of the trade (wholesale or retail) the total becomes $6,899. There is some wholesale loss in there. It looks like some of that is internal sales within the dealer group. I do not know all the dynamics there. Yes, I am curious to find out too!

The average front-end gross on the sale of the trade is $1,909 with the wholesale loss. The back-end gross is $1,429 and that includes wholesale deals as cash deals. I want to examine these trades a little more to see how many of them are high mileage or older vehicles that can't be financed easily. However, the average year of the trades overall is 2016.

:time: The trade is sitting on the lot for an average of 23 days. Spot-checking a few stores, it looks like the ones that are hanging around longer are in smaller markets. I would think quite a few of these trades are getting salespeople excited as the best trades come from service. It is hard to tell, at this time, whether dealers are loading up on ACVs a bit more because these are service customers.

:light: 86% of the initial sales have been loans with an average term of 63 months. 13% have been leased. 1% have been cash. Normally cash deals are closer to the 10% mark of overall dealership sales and lease penetration is usually over 25%, so here are some thoughts... these are service customers who were not fully in the market. They decided to take the offer and needed to supplement by borrowing from the dealers' banking relations - not their own credit union. This is why I think so few are cash deals. And why not more leases? That's simple: too much equity.

Disclaimer:
SERVICEiQ is a new product. It came to market in Q4 of 2021 and has rapidly grown! Roughly 20 dealerships have been launched each month since January with the pace ramping in April of this year. So, these numbers are indicators; not absolutes. But I'm liking these initial indications!
 
We have found a way to track acquisitions (no sale of a new or used car) in the DMS and a few of our dealers are killing it!

A Cadillac store down South pulled 8 cars out of the service drive with our software in April - solely acquisitions. A low-volume group in Indiana is pulling 2 to 3 cars a month out of their service drive consistently per store. We have a few stores well into the double digits.

These stores are using an outsourced BDC to help with follow-up after a customer engages with our app.

We only see these when the car the dealership acquired is sold to someone else. So far we've tracked 122 straight acquisitions that have already been sold across 42 rooftops.

What about the traditional sale?

Through May of 2022, we have tracked 740 total sales with 740 total trades (we only track the VIN we sent an offer to and whether the customer clicked on the offer to play within our app - if they don't trade that car, we don't count it yet). Of those 740 sales, there are an additional 135 trades yet to be sold. This is across 53 rooftops in 21 states representing 15 different OEMs and 9 different DMS systems.

On average, it takes about 5 hours for the customer to engage with the offer and 21 days for their VIN to show up as a trade on a closed deal in the DMS. It takes, on average, 25 days for their trade to show sold in the DMS to the next buyer.

We had a hell of a time getting all this straight based on VIN-only tracking because so many customers we sent an offer to are buying the trades of other customers we sent an offer to. It was confusing trying to deduce what the hell was going on in the data :lol: but :rocks: to so much incremental business! When you tap the service drive, you're just getting bonus business... in most cases.