What works best for new cars: MSRP or Internet Price?

Steve Sams · Nov 7, 2011

I want to drive more traffic to my site. I have personally worked very hard to put up a site that is user friendly. I have never been a fan of the cookie cutter Cobalt site that I have to maintain as a GM dealer. I chose to feature a new ebiz site that allows me to change pricing at the click of a mouse. I still have a lot of work to do but traffic is my main concern. Right now I am putting some models at MSRP and gutting others to net. It seems to keep my main competitor on his toes but I would prefer to cut deep into their market share. Right now, I am playing their game with pricing but I would rather change the game completely.

ddavis · Nov 7, 2011

JQuinn said:
I would assume there's quite a bit to turning-around a big group of stores -- most importantly, the culture.

But since the title of the thread is What works best for new cars: MSRP or Internet Price?, I thought we were talking about this specific aspect of culture change. Silly me, I guess

John, I'm only talking about marketing. Every detail of when, how and where their cars are listed is being considered. I believe that market based pricing will move the needle but their is more to it than pricing. I'm certain that their morale has improved with the increase in sales.

ddavis · Nov 7, 2011

Steve Sams said:
I want to drive more traffic to my site. I have personally worked very hard to put up a site that is user friendly. I have never been a fan of the cookie cutter Cobalt site that I have to maintain as a GM dealer. I chose to feature a new ebiz site that allows me to change pricing at the click of a mouse. I still have a lot of work to do but traffic is my main concern. Right now I am putting some models at MSRP and gutting others to net. It seems to keep my main competitor on his toes but I would prefer to cut deep into their market share. Right now, I am playing their game with pricing but I would rather change the game completely.

Steve, Is that red base 2012 Camaro gutted out to net? How is that price, relative to the market? I couldn't find a disclaimer on your website, does that price include the $1000 rebate? How does Milton do in the market?

I don't have too many fond memories of Georgia. I was at Benning several times and actually spent my last four months as an intructor, there.

yagoparamo · Nov 7, 2011

ddavis said:
Just price the ones you want to sell.

I thought we want to sell all of them...?

Better answer would be "don't price tha way the ones that you are in no hurry to sell" like for example a Z06, a Mustang Boss, etc.

ddavis · Nov 7, 2011

yagoparamo said:
I thought we want to sell all of them...?

Yago, that is my smart a$$ way of saying that.

Steve Sams · Nov 7, 2011

That's $500 over net. There are no rebates on 2012 Camaros. Right now they have about 290 new cars compared to my 120. They will take a blood bath on anything. So I have to price that way to stay competitive. Georgia is a bit of a pit. I stay here to stay close to my daughter.

yagoparamo · Nov 7, 2011

ddavis said:
Yago, that is my smart a$$ way of saying that.

Got it, but you must be careful there are foreigners reading these forums and they may not get these things right away.

yagoparamo · Nov 7, 2011

Steve Sams said:
Georgia is a bit of a pit.

Steve,

Not just in Georgia...

ddavis · Nov 7, 2011

Steve Sams said:
That's $500 over net. There are no rebates on 2012 Camaros. Right now they have about 290 new cars compared to my 120. They will take a blood bath on anything. So I have to price that way to stay competitive. Georgia is a bit of a pit. I stay here to stay close to my daughter.

Steve, I would pull an invoice on 2G1FE1E32C9104836 to see if that vehicle actually exists. It has a stock photo. You need to figure out what they are doing. They may be selecting price leaders like many do for the newspaper, with hopes of a switch, holding on the trade or whatever. The vehicle may have been sold, traded or in transit.

Compare your vehicle against theirs. In your description, list the options prominately (like CD player) that their vehicle doesn't have. "This stunning Camaro comes with AM/FM Satellite Stereo System with Bluetooth and CD player, Steering Wheel Audio Controls, contrasting black rallye wheels,...." You don't want to have a VIN explosion as your description.

I didn't see a disclaimer on your website. They reduce their prices with the rebates (price excludes TT&L, rebates to dealer). You are not going to be competitive, with them, without doing the same. Figure out what game your competition is playing.