General Motors and Cobalt Websites-The Big Rip Off and the Slow Deception

I do not want to share my name because who knows what the repercussions could be if someone at GM saw the reaction. However, you hit the nail on the head!! The only thing MORE WASTEFUL than IMR is the LMA and that would take another 2 page article! Let the dealers do what they do best. QUIT getting in bed with VENDORS!!!!

I agree with you Frank, I was working at a GM dealership when they started pushing the free website from Cobalt. I was in the process of getting a Dealer.com website put in place and had to justify spending $900 versus the free site. We had a management meeting to compare the two websites side by side, by the end of the meeting they had decided that while losing the links was a negative, they would still rather go with the Dealer.com site because the look, feel, and navigation were much better than the options that were available from Cobalt at that time.

A dealers website is a major part of their online presence and they should be able to decide who they want to use, they shouldn't be told "use our piece of crap or you won't get our links".

@Frank... excellent piece. From my understanding... the "free" program is no longer available. Is that correct?

Umer,,,,,You can still have the "free" website with Cobalt. You do not however get the support person unless you pay the 299.00 fee they implemented at the first of the year, They sent out a memo with a bill attatched charging the 299.00. If you choose not to pay the charge then they will still keep the website up and give you the "free" pay per click advertising using the name of your dealership redirecting to the Cobalt website. You can get support from Cobalt if you are not paying the 299.00 but they claim you lose more than you gain, huh?

Another idea was to up sell other services and products once the dealer is on the "free" website and I am sure it has worked. Brilliant plan as I had said give em free stuff but really charge them for it, then up sell the real good stuff, Great plan, awesome monopoly.

Frank, I sense your frustration... I would venture to offer this. I believe much of the reason that GM started with the mandatory Cobalt sites was to bring a lot of GM dealers into the "modern era", as there were still LOTS of GM dealers that had not grasped the importance of the Internet yet. I can tell you in my area that at least one GM dealer had a website that one of their employees put up on their own because the owner didn't see any value in the Internet (and it was not a good website...). There were lots of GM dealers with no websites, or very poor websites across the country. This approach by GM brought some standardization across their brands and got dealers to get "onboard" with the Internet.

In GM's defense, I have seen a tremendous improvement in their emphasis on being aggressive and good on the Internet. I work with 15 brands, and I would place GM in the top 3 brands for OEM support for the Internet.

With all that said, we still have separate websites for our GM stores, and keep the Cobalt one for the OEM link (I agree, you must have). I also agree that the pay per click using the dealer name for the search terms makes no sense (but makes lots of dollars for the vendor hosting the ppc...). In a perfect world, we could have our own websites linked to GM's sites - but I would imagine that GM would want some requirements met (fair enough) to ensure quality for all of their stores....

Frank - great post! I love it on 3 levels:

1. It strikes home with other brands we do carry, so I can relate - MINI, VW, Audi, Porsche
2. CoBalt is the worst site provider, of the big ones, in the automotive arena - I'd rather pay for something else than take their freebie
3. The more of us complaining about these stupid OEM sites, the better!

I think we need to have an article that talks about all the OEM sites and where they're wrong. Something we can refer our OEM's to when they ask our opinion on things.

One size fits all. That’s the approach many of the manufacturers take with these mandated dealer website and online marketing ventures. It’s nothing short of a pain in the A$$, especially for the more aggressive dealers that usually have their own thing going on.

I’m not for it BUT I can understand why it happens. And I believe it happens for many reasons. In this example with GM, I think Kevin explained it very well in his comment. “Cobalt sites was to bring a lot of GM dealers into the “modern era”, as there were still LOTS of GM dealers that had not grasped the importance of the Internet yet”. There are no doubt MANY dealers that are still trucking 20-15 years behind and STILL do not have an internet presence.

How does a large company like GM get their antiquated dealers onboard? They leverage a vendor to do it for them while placing all their dealers in one basket. You bring the lost dealers up to speed while pissing off your aggressive dealers. However, it’s MUCH easier to manage and have a relationship with one vendor rather 3-6. One point of contact, one enterprise report, one company to praise or one company to blame. Unfortunately “one” doesn’t work. You’d think GM would have that figured out by now.

As for wasting money on PPC by buying your dealers name. No doubt a huge waste, unless the dealer didn’t have a website to begin with and they were supplementing with PPC until the site was indexed in the SERPS. Of course we all know this is not the case. It would be interesting to know what Cobalt was/is charging GM (I mean the dealers) for these dealer name keyword clicks.
The money GM spent on these unnecessary clicks could have been spent on specific dealer internet sales and marketing training for the dealers that needed to get up to speed.

Hmmm....I wonder why G.M. has more then one brand if one size fits all.

Thank you for the posts. Understanding GM had to many dealers not paying attention to internet marketing. They did have to do something I agree. Having one website company on board to lower costs, I agree, but to trick everyone into a free website and actually charge for it? Please lets give it up for "free" if you are going to use that term, not charge it to the advertising funds on the invoice. Also when you have aggresive dealers do not redirect them to a website they are not advertising for, do not steal from a dealer doing everything they can to market on the internet. But most of all do not lie to the dealers that are making it work. It was a good idea I believe they just got off track and imposed rules where they didnt need to be. Also they needed onsite training. an experienced trainer should have visited every dealer to evaluate and discuss the marketing on the internet. One size does not fit all as a matter of fact if its to tight you might just kick it off.

Frank

Frank! Thanks for posting this here. You and I have went back and forth on this subject which now is a very touchy one!

Thanks again it is appreciated!

I'm hoping my competition continues to use Cobalt wesbites. They are ineffective in converting customers and have weak tracking/reporting. I have the free site (with no $299/mo advocate support) so I get links from chevy.com. The only 2 problems I have with the whole deal, is not getting a link to my own wesbite and I'm competing with Cobalt PPC campaigns driving the bids prices up.

I can understand why GM started the program in the begining, but by now any dealer that would not be able to adequately handle theirselves with an online presence probably won't ever be able to. Why not let them weed theirselves out? I have a deep seeded loathing for Cobalt, and want to pull my hair out everytime I have to call ECare for anything. We have so much trouble with our Cobalt sites.. All of the cars were marked with manual transmissions for awhile, we changed the company that sent the feeds for our inventory, and it took two months for everything to show up properly. One hand has no idea what the other one is doing!!! I do miss having an advocate to make changes for me, but I just couldn't see paying $900 a month for something I can do myself....

themselves!! I hate that...

How does Frank Davis sit down?

Seriously.

Think about it for a second.

How do you sit down with balls the size of spring ripe southern Canteloupes?
You know those big ones the grocer adds another 30% price too from standard, anyway... i digress.

Everyone thank Frank for being upfront and sharing his knowledge which is extremely valuable for us all.

Frank's the man.

I think it is good for the OEMs to mandate certain things on a dealer's website.

But I think this is best done the way Toyota, Honda, Nissan and others do. They review the sites based on certain requirements and the dealership gets in trouble if their site does not comply. They don't FORCE any particular vendors or special secondary websites.

Just stumbled on this post and thought I'd chime in with some of my own comments.

First off, I think its an enormous mistake to punish dealers with ambitious internet programs. Clearly, Cobalt's solution was to get dealers on the internet. However, if you're serious about your internet program you realize that Cobalt can only get you so far.

And it's not just GM. Scion has an agreement with Reynolds. Chrysler has a deal with Dealer.com, etc., etc.

These companies can't be everything for everyone. A dealerships internet program requires a great deal of attention that Cobalt, Dealer.com, nor Reynolds can handle.
Things will move to the edges a bit more and I think the overall shopping experience will improve for consumers online.

Great post. I liken this to going into a Chevy dealer tomorrow and all you can choose from is the Malibu. They stopped making every other vehicle because GM felt that was the best choice for customers. You can complain about it all you want but you'll still end up driving home in a brand new Malibu. Just hope they made it in multiple colors!

You can add Volkswagen and Audi to the list of manufacturers who require their dealers to have a Cobalt web site in order to receive leads from the manufacturer.
The manufacturers should worry about their own web sites and allow their dealers to be creative with their own. If someone goes to audi.com and asks for a quote, that quote should go to the nearest dealer regardless of what web site provider he has chosen to do business with.
I suppose that a few years ago when we all started to realize how important a web site would be, it perhaps made some sense for the manufacturer to want to dictate dealer web site content and appearances...after all, the manufacturer had more money and resources to make good decisions on behalf of their dealers.
Today, though, I think I can make the case that perhaps most dealers are smarter than GM, Ford, Chrysler etc., all of which are setting new records for poor performance.
Maybe the dealers are actually capable of making their own web site decisions now?

I want to thank everyone for all the positive responses and support you all are a huge part of the automotive marketing world we all live and play in. I received an e-mail from GM today which wants me to push that much harder, I believe most of you realize the importance of what I have been talking about in regards to the monopoly and the direction we are headed as having rules stuck in front of us and not being able to make the choices we see best for our dealers etc. Here is part of the e-mail I received minus the name of course.

<b>Frank,

I have ran this issue down through both Cobalt and the Director of the IMR program at GM. The bottom line answer is that IMR program will continue to include the Cobalt website and a basic level of paid search advertising for that site. Modifications to those offerings will not be allowed under the IMR program.
I understand this not the answer you were looking. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx. However, I have received very clear direction from Detroit on this matter and do not expect a change.</b>

I have done my best to inform and give my best analogy of the situation I see as detrimental not only to our advertising but our actual ability to make choices that effect the way we make a living.

Frank Davis
918-520-6777

Frankly, all the website companies are the same in certain aspects. I think it really comes down to their conversion ratio or the traffic to the site being converted into leads, either phone calls or emails. We personally have a Cobalt website through GM, and we have the upper package with the search. We have gotten great results in the past 8 months. Our "procare" person is awesome and always helping us with specials and going over our reports and constantly helping us with our online strategy. The search that GM does for their dealers are on 3 tier levels. The first pushes back to GM. The second pushes back to a DMA landing page. The third pushes back to the dealer and is triggered by name and location of the dealer. I think this is a good thing that GM is looking out for us and spending our money digitally. As far as doing additional search with Cobalt, it has more than paid for itself. Unlike other companies I have used in the past, they actually come up with a strategy and have someone running my campaigns rather than just flip a switch and spend my money. We can sit here and bash GM and Cobalt or any other OEM or website provider all day long, but at the end of the day, most of the OEMs are moving towards this and if you ask GM and the dealers out there, it has greatly produced results (even for some of us that have been doing this for a long time). Frank, it seems as though you really have a bug up you about GM and Cobalt. I understand that some dealers want their freedom of choice, but most make the wrong decisions. Coordinating efforts gives us better pricing and more value. I love Cobalt and what they have done for my dealership. Best of luck to all of you. Instead of complaining and complaining, come up with a marketing strategy that works for you, use your procare person (the 299 a month is well worth it), and sell some cars. The squeeky wheel gets the greese, but sometimes it gets replaced. Happy Selling!

Hello John

Thank you for the post and the information and I have to say it is great to hear that someone is doing well with the cobalt site. If you notice at the begining of my post I said GM and Cobalt had a great idea but with major faults built in. I had a good pro care advocate and was always very helpful.

I have come up with a marketing stratagy as you have suggested and Cobalt gets in my way. I am not complaning as you suggest but pointing out the fact that GM and Cobalt has lied to the dealers and continues to direct consumers away from our website that we advertise for, I believe you have not read the article or understand its content and you need to understand that I have a huge amount of respect for not only GM but also for Cobalt as they have a huge amount of experience etc to offer "some" dealers. Other dealers that have been aggresive on the internet have other " marketing plans" that do not include Cobalt, simply said Gm should not push a website provider on its dealers that have that "marketing plan" in place nor should they place a PPC campaign using a dealers name when they have been asked not to. I want the Cobalt site for one reason and that is to get the link from Chevy.com to a website for Jim Glover Chevrolet.

Thanks for the response. It is good to see another point by a dealer that is successful with a marketing plan utilizing a Cobalt website.

Frank Davis

I am not understanding how you feel that GM and Cobalt lied to the dealers. In what way did they lie. Honestly, I have no loyalty to GM or to Cobalt. I have used Dealerskins, TK Carsites, and Dealer.com in the past, and honestly, there is not much difference. If you look at a top of the line Cobalt site compared to any of these, including your Reynolds site which I was just on, I think you will not see that much difference. I was able to make my site look much different than many of the other GM dealers out there and I am happy to see GM using our ad dollars where the eyes truly are, in digital on the web and in TEVO proof television like the news or sports. I cannot see the bad in that. Would you rather GM spend it in places where the eyeballs are not? While I don't agree with everything GM does, I can see where they want to keep uniformity and have some sort of control over the web content as a Chevrolet, Caddy, GMC, etc... dealer is representing their product. Nissan is the same way. You have to have a Nissan compliant site, but they do allow for different vendors. What GM did was allow us a base site using our ad dollars (which we can opt out if we want) and also negotiate a very fair price. Take that into consideration with the fact that it is all turn key coopable and I think it is fantastic. Take Cobalt out of the picture and replace them with any of the other Web Providers, and I still think that GM is trying to do the right thing and many other OEMs have followed ie: Chrysler, Subaru, etc.. Now take a look at Lexus, you want to talk about stringent, they will not let you put new inventory on your site. They have their reasons for this as well. I am not arguing with you at all Frank, but I really don't understand where you say GM and Cobalt lied, and I see true value in what they are tring to do. Sooner or later the OEMs will get it right. It just takes these big giants to move a bit slower than other industries. Cheers! Let's sell some cars!!!

Hello John

I agree with you 100%

Toss me a call sometime

Frank Davis
918-520-6777

This is an AWESOME explanation of The Cobalt/GM/Dealer relationship. The whole situation is ridiculous. A few points:

#1 - Bidding on the dealers name could be acceptable in SOME instances. Let's say a 3rd party lead provider is bidding on a dealers name and coming up first. You may want to take that position away from them with your own URL. There are some much shadier and devious reasons you may want to own that spot yourself which I'm not going to mention here. Let's just suffice it to say that if you don't own spot #1 for your own name you are OUT OF YOUR MIND! (I'll explain this to Jeff privately if he wishes)

#2 - Did you know that if you don't have a Cobalt website, Cobalt (or Chevy) trademarked their name in Google making is super hard to run a PPC campaign if you don't direct the traffic to an official dealer domain (aka a cobalt website for the most part). Why would you want to drive traffic to a URL unrecognized by chevy you may ask? How about if you are setting up custom landing pages to do something a little different and change up your message...

I hope I have brought some ideas to the table here. I'm a search marketing superstar and always around to help cool folks like you.

Keep Hustlin'
Ad Hustler

Regardless of how we look at GM's handling of their alliance with The Cobalt Group, we should probably take note when a company who is suckling from the American taxpayer after receiving assistance from the US Congress, stands up for what are basic American principles. Such as Freedom of Speech, often defined as "Liberty to express opinions and ideas without hindrance, and especially without fear of punishment."

Yet, GM has seen fit to contact Frank Davis's employer and threaten the dealership with adverse actions if Frank does not rescind or retract any criticism he has made about GM and their sole-supplier relationship with The Cobalt Group. Is this the America we really want? Where corporate egos can intimidate and silence their critics without need to defend or explain their actions? Is this the type of intimidation and coercion that we want our government to support with taxpayer money?

In addition to threats and coercion applied to Frank Davis, other automotive professionals who have provided a platform for GM dealers to express their criticism of the GM and Cobalt partnership have had their jobs threatened and have been banned from doing any business with GM. For what? For simply allowing GM dealers to have freedom of speech and a venue with which to express their complaints.

General Motors and Cobalt are certainly free to run their very successful, dynamic and fast growing innovative companies any way they see fit, but when becoming a federally funded institution, which GM certainly is right now, shouldn't they be required to at least honor the constitutional and civil rights of their dealers and the people who work for them?

Regardless of how we look at GM's handling of their alliance with The Cobalt Group, we should probably take note when a company who is suckling from the American taxpayer after receiving assistance from the US Congress, stands up for what are basic American principles. Such as Freedom of Speech, often defined as "Liberty to express opinions and ideas without hindrance, and especially without fear of punishment."

Yet, GM has seen fit to contact Frank Davis's employer and threaten the dealership with adverse actions if Frank does not rescind or retract any criticism he has made about GM and their sole-supplier relationship with The Cobalt Group. Is this the America we really want? Where corporate egos can intimidate and silence their critics without need to defend or explain their actions? Is this the type of intimidation and coercion that we want our government to support with taxpayer money?

In addition to threats and coercion applied to Frank Davis, other automotive professionals who have provided a platform for GM dealers to express their criticism of the GM and Cobalt partnership have had their jobs threatened and have been banned from doing any business with GM. For what? For simply allowing GM dealers to have freedom of speech and a venue with which to express their complaints.

General Motors and Cobalt are certainly free to run their very successful, dynamic and fast growing innovative companies any way they see fit, but when becoming a federally funded institution, which GM certainly is right now, shouldn't they be required to at least honor the constitutional and civil rights of their dealers and the people who work for them?

What this comes down to as I have said in the past is: if you want to do something different then the dealer 5, 10, 15, etc miles away then do something different.

On a national level, GM-Cobalt does not have the dealers best interest in mind. What about the areas you want to target and so forth?

I have placed lengthy post on ADM on this subject. Feel free to check it out. ( Thats if it is still there and not removed lol! )

Jeff,

It is a shame to see that the GM and Cobalt black hands of censorship has extended into DealerRefresh as well as the other places where Frank's article has since been rescinded... Can we think of a few other times in history when a major corporation has used threats and intimidation tactics to silence their critics?

@Anonymous Car Guy - You're right about that but I had to make a call here. I didn't want anyone loose their job. I held onto it as long as I could.

Losing his job is best thing that could happen to someone that realizes their potential has been capped by a company so backward and doomed to failure as GM.

Frank, 'tis a sign of things to come. If you want to survive this storm, "you're gonna need a bigger boat!" Once you go Jap, you'll never go back!

Then repost your article anywhere and everywhere you can!

Best of luck Frank. Jeff, you or Alex should have hired Frank and kept the article!

I'm sure GM did this because there were some lines about a conspiracy in the original article. If it were just a criticism of the program through CoBalt and a request for more options (as many of us have made toward other OEM's) GM would not have spent the time and resources on this subject matter.

I'm positive it was the conspiracy theory that pushed them to spend depleting assets in an effort to avoid a possible public relations nightmare that may have ended up on CNN. It had to be a very significant threat to spend any time/effort/money on something like this right now.

Or it could cost GM more money to sever ties with CoBalt and spend resources on sourcing other site hosting companies. They figure the efforts used to put-down any kind of notions towards a change are well worth doing instead of chancing the consequences of having to spend more money on some little dealership websites.

As a taxpayer; an ignorant American, I have to create my own delusions these days to find any kind of comfort with these companies who are asking for my money. Especially the ones who, in turn, spit on my American rights.

I wanted to comment and say that My outlook on Cobalt has not changed and I cannot believe they continue to use a PPC campaign in dealers names, it was my hope they would take a good hard look at it and use that money for a better marketing plan. But then maybe they are still working on it?