Industry News & Trends

A Message from AutoTrader to Dealers

An Important Video Message from AutoTrader.com

Alan Smith, Sr. Vice President of Dealer Sales, and Chip Perry, CEO

message_from_autotrader2

This video will open in another browser/tab

Alan Smith and Chip Perry talk about the challenging times and some of the changes that are taking place at AutoTrader.com. This is a good message, I recommend watching it in it’s entirety. If you have an opinion, lets keep them positive and/or professional.

Founder of DealerRefresh - 20+ Years of dealership Sales, Management, Training, Marketing and Leadership.
F
  • F
    former AT dealer
  • June 30, 2009
Oh now they want to change course and listen to their dealers concerns and help them, HA!
It only took a significant decline and reduction of their revenue for that too happen.

I haven't used them almost a year now and didn't feel any negative impact from it, but I remember being told that I would be going out of business if I canceled.

Generally companies make these type of announcements when they're bleeding from the eyes and hit defcon 5.
F
  • F
    former rep
  • June 30, 2009
I am a former employee of ATC who had been with the company for over 7 years and just got laid off. I am so sad because Not only did I love my job and my dealers but I was making an impact in my dealers business. Now that ATC has laid off 20% of their sales staff, the remaining reps are getting double and triple the amount of accounts. Dealers, be happy if you see your reps once a month.

WORST of all, most of the reps that were laid off were the best out there.
L
  • L
    Lightnup
  • July 1, 2009
former AT [email protected]
Apparently you missed the entire exchange way back in January (although I don't know how you could have missed it) about ATC's sea change and concerted effort to partner with their dealers rather than just be another vendor. Your assertion that this is a sudden change solely because of recent economic events is incorrect.

Former [email protected]
I feel your pain (been there myself) and can understand your bitterness, but not the overblown hype. Simple math shows that a force reduction of 20% cannot possibly result in "double and triple" the number of accounts for the remaining reps. Example: 4 reps each have 30 accounts - total 120 - and one leaves (a 25% reduction in force), the other 3 now have 40 accounts each, which is not even close to doubling or tripling their account base.
D
  • D
    DTG
  • July 1, 2009
Could have switched heads and called it ADP. These are tough times right now. We all have a responsibiity to speak up for car dealer rights. You can start with http://www.hometownautodealers.org/

Good Selling!

DTG
F
  • F
    former rep
  • July 1, 2009
Dear lightnup,

20% is a national number, it was 50% in my district alone therefore the statement I made was correct within my district. I'm not bitter about losing my job for financial reasons, I fortunately have a spouse who makes more than enough. I am bitter because I out performed most of the remaining reps and actually cared about my dealers business. I do agree that the economy warrants the layoffs, but they should have been better chosen and not just the highest paid to save ATC money.
R
  • R
    Ron
  • July 1, 2009
KBB is launching A BRAND NEW INVENTORY LISTINGS PROGRAM, check this out...

http://solutions.800bluebook.com/showcase_inventory.html
A
Thanks for the SPAM Ron....
F
  • F
    Frank Jackson
  • July 2, 2009
I preferred it when you guys let it all hang out in telling the truth about AutoTrader.It seems ever since Metter and MileOne got that big contract that they flew him to Vegas for, you have turned into their champion. Money is money and we understand that. Chip Perry does not mean a word he said. He wants dealer money, he will do and say anything to get it. He has screwed dealers for as long as he could now he is Mr. Nice guy trying to squeeze as much cash as he can before his kingdom completely collapses.
R
  • R
    Ron
  • July 2, 2009
You're welcome Alex!
M
  • M
    Mark Brady
  • July 2, 2009
It is silly to even believe that the Alan/Chip clip is sincere. Auto Trader is laughing all the way to the bank! As a former seven year regional manager with AT.com I can tell you that we made silly, stupid money on our commission/bonus from dealers spending WAY TOO MUCH with an under achieving 3rd party site. Dealers continue to trip over themselves to spend $$thousands$$ monthly on a dinosaur product that requires self service PLUS over promises and under delivers. The site is old technology. Look at interactive media options for greater ROI. That's the hot new wave...
F
  • F
    former AT dealer
  • July 2, 2009
Lightnup, seems like your on the defense here for AT?
I was referring to the new video that was announced, which was a worthless effort and boring, imho.
Facts are facts, I loved AT back in the day, but they have left a bad taste with alot of dealers over the last few years with price hikes and trying to spin truth.
Hey it is what it is, if they can give me leads again for a fair price I'd consider going back, but I get 3X more than AT gave us using free sites and solid in-house seo.
@Ron, common..great way to represent KBB! I thought you would know better. I mean there is a whole posting about the new KBB offering.

@Frank, sorry you feel that way. I think we still "let it all hang out" (if not I would have deleted your comment :) ).

David Metter's post was nothing more than another perspective and is not a representation of myself. I can tell you that MileOne was onboard with AutoTrader way before that post and even before I was an employee with MileOne.

Prior to MileOne, I was using and very successful with AutoTrader for years at prior dealers.

No doubt AT has made some huge mistakes and I'm not here to defend their actions but I think there "could" be some sincerity in what they are trying to achieve (or maybe they're just trying to fix their PR before another attempted sale). Who knows really...but it's a huge ship to try and change direction with and it doesn't happen over night.

Time will change and AutoTrader with either adapt and keep afloat or they will sink. Only time will tell.

As for Metter's trip to Vegas...I wasn't apart of that. :)
B
Putting aside the content of the video, this is hard to watch. Jeff, I did take the time to watch it completely since you asked us to.

The video is poorly framed and too many segments put both men in a "box" with a bobblehead effect.

The video mood is tense, stark, uncomfortable and monotone. What we did not see were the shock pads that must have been under their seats is they strayed from a tight legal script.

The video does not delivery any "optimism" for car dealers that are using AT in my perspective.

I like the idea of creating a video message to customers about changes in any company but this amateur low budget video feels like a police lineup confession.

If this video was to convey a encouraging messages for AT customers looking out to the next 10 years of innovation, this video is DOA.
F
  • F
    former rep
  • July 5, 2009
ok, so I just realized ATC brought over the top 140 print reps in Jan 09 to use them to convert all of their print dollars into ATC.com dollars. Now that it has been done [I heard it was over a half million in GA alone] 140ish reps were just laid off. They were print and .com reps combined, but still interesting huh? Master plan all along maybe???????????
M
I’m glad to see the video we put out has sparked a lot of conversation about AutoTrader.com and the state of the industry. That was our hope and the feedback we’ve gotten both publicly and privately has been both honest and helpful. As we said in the video, our efforts are all designed to help dealers sell more cars. We’re continuing to hit record traffic numbers, routinely attracting more than 15 million unique monthly visitors to our site, visitors who spend about 30 minutes on average looking at your listings. This is up about 2 million from our average unique visitor count around this time just last year. So car buyers are definitely responding to AutoTrader.com and turning to the internet in general more and more to find information about cars they might want to buy. And dealers are responding too. Even in this tough environment, where the total number of auto dealers is shrinking, the number of dealers using AutoTrader.com has increased for the past few months as more dealers follow the customers to the internet and out of traditional media. We’re happy to have a discussion on the benefits of internet advertising at any time. Just give a call at 866-545-4065.
T
Mr. Perry,

A little less than a year ago we issued our cancellation letter to autotrader.com. After years of poor service, times when it seemed there was no rep in our area, and price increase after price increase, we finally had enough. Then not 30 days later, the new District Manager and Rep came to introduce themselves and talked about an autotrader with a new focus and better value. An autotrader where 40%+ annual price increases would be a thing of the past. But the catch was we had to get on "current rate card pricing" So we took nearly a 90% increase AGAIN and gave you another chance.

For the first time we truly experienced SERVICE from your company in the form of Rep Paul Liolios. We saw increases to our used car sales and traffic specific to AT.com. Then a new product, Alpha, was made available. This product had not been proven and there was no indication this would make any difference in our market place, but we put our faith in our rep, who was convinced this would make a difference in our declining market. While we were already experiencing strong performances in spite of the decline that was taking place all around us, we decided to take a shot and added Alpha to our marketing strategy. Just to recap for a moment, Our little rural Nissan dealership with 40 employees went from canceling our $2,900 monthly featured listing to becoming a $4,800/month partnership and adding $3,000/month alpha product in a three month span. The following month we added a second alpha spot, new car partnership and edmunds.com bringing our total monthly spend with your company to $12k.
Then a few weeks ago, when we called Paul to come in knowing full well we were going to add another alpha zone but, he informed us that our biggest competitor bought all the zones we already has as well as the additional zone we intended to add. We were, to say the least, stunned. Here we are a dealership that was almost lost to autotrader for good, and 6 months later we're spending 50% of our total advertising budget with your company only to find that you were taking it away and giving it to our competitor, who had no interest in your product when it was new. Who wasn't willing to put their faith in an unproven product. Just when we thought we had a "partnership" we found that in fact we were used again by the vendor with the worst name in the automotive vendor space. Once again, autotrader.com has shown their true colors. It should be obvious to any ethical business, that selling out one company for another or attempting to create bidding wars is not the way to retain customers.
T
I followed that up with another cancellation letter.
D
  • D
    Dealer Consultant
  • July 7, 2009
Wow, presentation skills 101. I thought I was watching a funeral. Where was the marketing Dept and P.R. for this video? I am in the Video business and the Automotive business, and this would not even make it to YouTube! This could have been presented on a such higher level. Not "gloom and doom". Who did the story board for this? It is a shame, they one chance to make this message very effective and mean something, and they Failed. Remember MIU????
F
  • F
    Former ATC MGR.
  • July 7, 2009
Dealer Consultant is right. As a former manager with ATC we were taught MIU (Mediocrity is Unacceptable.) That lesson fell short with this Video. It is my assumption that the intent of this video was to go viral. The only thing viral about this video is it could make you ill, or to put a positive spin on it,it could be the cure for insomnia. Who ever put this video together should be the next one out of the revolving door on Peachtree Dunwoody Road. WOW!! I am shocked, it is sad to see how far the mighty have fallen.
A
I have taken my time on posting about this even though I watched the video when it was originally posted.

First off I have to agree with Brian Pasch 100%, and would like to add that I'd prefer to go to a funeral over watching this thing. Whoever orchestrated this production has no business in marketing or Public Relations. I feel sorry for Alan and Chip - this is a reflection on them and I'm sure it isn't something they put together themselves. If you guys came up with this, keep it a secret. If you did, it shows that you know very little about Internet marketing and that would speak volumes toward ATC.

Second...lower your prices. Charge for the level of service you provide. This has been my only beef with Autotrader.com. Yes, I have written about other things, but at the end of the day the argument is so strong because you charge more than what you're worth. You're taking advantage of a good name you didn't start and the mentality of old-school car guys who don't know any better. Maybe you don't know any better either. But at the end of the day, your pricing is the issue.

Third...I applaud you for finally making some sort of move to squelch the things being said about your organization. You still have a very long way to go (lower prices), but I think you'll find we all want to see you get better. Do more!

Fourth...on lowering prices (in case I forgot to mention that), here are some hard numbers from the Checkered Flag and Drivers World Automotive Group that I'm about to show to some of our GM's who continue to flirt with ATC. My cost per sale (Internet and phone) with ATC is $416.18 ...without ATC it is $243.14. Please don't respond with "but the majority of the ATC customers walk through the door."
L
  • L
    Lightnup
  • July 7, 2009
[email protected] Imagine how low you could get your cost per sale if you didn't advertise or market your inventory at all. You'd really impress those GM's then.

And if you are still holding to the antiquated concept that only an email or a phone call counts when judging your online marketing, you're doing your GM's a disservice. When you go online to research a purchase at Best Buy and you find what you want, do you call or email the store or do you hop in the car and drive over there? I just drive over there. (I'll bet if you ask your neighbors and friends, most of them do too.) Does that mean I'm not an Internet customer, even though I found what I was searching for on the Internet? With the vast amount of information provided in online listings, why would a shopper other than one from far away even need to call or email before coming to your lot to look at a car? Some will, many won't. Yet they are both brought to you via the same advertising venue. If you truly want to figure your cost per sale, your objective should be to determine what venue brought them, not to automatically rule out the Internet as the source just because they haven't called or emailed first. That's true whether it's ATC, cars.com, your website or any other place your inventory appears.


Former ATC [email protected] A record 16.1 million unique visitors to ATC in June - that's hardly a description of the mighty falling.
A
Please don’t respond with “but the majority of the ATC customers walk through the door.” ...thank you very much.

I will agree with the assumption that some people walk in, but the same could be said for Cars.com can it not? Why is it that we consistently sell more cars through Cars.com for less than half the cost?

I think I will disservice my GM's another time, and will continue to disservice them everytime the numbers don't add up. I am definitely getting sick of this argument internally and externally.

Why is it Autotrader.com every friggin' time? Can you at least answer that?
I
  • I
    interesting
  • July 7, 2009
So, ATC is crying the Economy blues? Well they just checked in about 75 reps/managers into a Ritz Carlton in Michigan for a meeting......They are so full of %#*&.
S
  • S
    sellmorecars
  • July 7, 2009
Why does anyone really care about what ATC employees do? You all should spend more time chasing your 20% email traffic and a little less time being on this blog during work hours. Don't you have cigarettes to smoke in the parking lot while telling your vendors your too busy to market your cars? Oh, that's right, no one hear makes decisions so none of this matters.
S
  • S
    sellmorecars
  • July 7, 2009
sorry here not hear before everyone blasts me. Now, back to growing my business.....
M
Hi DR blog!
First time poster, long time reader.

I've heard about these ATC postings here from sooo many people recently I just had to check it out.
I missed the last ATC blog-festival here and didn't want to re-live saying "no I didn't read it yet" in conversations.

I glanced at the thread history for this topic too; my gawd JK you must be lovin' this ATC controversy (and traffic;)!

Anyway, I'm an agnostic party here in the digital trenches of automotive lead generation drama, I could truly care less. I'm also officially off-duty too, so screw that no blog posting corp mandate. I'm going rogue here.

First to ATC: I understand wanting to deliver an important message to your core biz ~ the dealers.
Excellent idea, I'm all for it, but why a video?
And why a video about tough times, changes, and blahhhh?!
And then why so dreary and canned?
Who approved that?

Please pump that video up next time!! Seriously, you're still a very crucial part of alot of dealers business!
I talk to dealers everyday that absolutely love ATC, and sell a bunch of units daily from it. Focus on the positive, read some Ziglar or something. There's still a bunch of light at the end of the tunnel, maybe go do some dealer testimonial videos, and put them on Youtube (btw i can help with that;).

Next to the ATC haters:
Bottom line is you've either been offended by ATC in a variety of ways as a customer or employee, or you don't believe the money invested in ATC is worth the return, right?

The positive I get out of this is; the former customers looking for ROI just want to see it first hand, prove it to them, be their friend, partner, work with them, and they'll buy again. (maybe not Tim, but hey ya can't win them all)

As for the former employees being offended; I have no answer, no thought, no comment, and I ain't touching that topic. I'm truly sorry to see job loss happen too anyone, it sucks.

On a final note, I won a national video parody contest with Automart.com back in the good ol' days with legendary "real" guitar hero Johnny Fink.

We submitted 2 videos out of 3 overall nationally, and took 1st and 3rd place... Now that's total domination!!
So next time ATC needs to deliver a message, someone might want to look towards captain video and Johnny Fink too get that done for ya, huh??

http://www.youtube.com/watch?v=h9fJELZruNY

BTW I never got my flip video camera for taking 1st place, or my "shop smart @ automart.com" bumper sticker for taking 3rd??

Johnny said he got his right away, SO who's ass do I need to kiss too get my prizes??

L8r
-Sayre
J
  • J
    Jerry Morris
  • July 8, 2009
Alex, in these times the term “walk-in” must be clarified. Old school a “walk-in” was just that, someone who walked into the dealership to see what the dealer had in stock. Because, there was know definitive listing easily available of the dealer’s inventory.
Enter the internet age you have dealer web sites, 3rd party web sites, and a litany of other inventory listings. When a customer walks into a show room not only do they know what the dealer has in inventory but in which vehicles they are interested.

The 2008 Dealer Brand Image Study & Dealer Walk in Study showed very clearly that 80% of dealer traffic is walk-in that has not previously contacted the dealer by phone or email. The remaining 20% breaks down 17% phone, and 3% email. This varies greatly from the dealer’s perception which is 41% Walk-in, 42% Phone, and 17% email. This study was conducted in 17 markets and 59 dealers nationwide. These were exit interviews of people who had just bought vehicles.

I don’t want to be accused of heresy, however it’s time that dealers and internet managers realized that they don’t need internet departments, they need internet dealerships. 80 plus percent of there traffic coming into the dealership is coming off the internet, and that traffic is called walk-in.

Phone calls and emails are the most convenient way for internet managers to justify their work. But as long as there is internet sales and floor sales there will always be a fight over what is walk-in traffic.

Where as a BDC that get’s the customer to visit the dealership, introduces that customer to the Sales Manager or General Manager who then introduces that customer to a sales person to compete the process will have far more accurate numbers on traffic composition.
A
Jerry - you're preaching to the choir. You probably wouldn't realize that if you only know me from my postings in Autotrader.com threads.

My argument is this:

Yes, most people walk-in. However a percentage of folks do pick up the phone or request information via a form. If I were to only look at Cars.com and Autotrader.com under this small percentage I find that Cars.com is double the effectiveness for more than half the money without a bunch of differing packages. On top of simply looking at non-walk-in traffic I also have this nifty tool from vAuto that they call "Merchandising" which looks at the impressions, detailed views, and form submissions for ATC and Cars.com on each car. Every single time I look at it Cars.com has double the detailed views and form submissions.

These are the tools of accountability I have at my disposal and when you simply look at the numbers it is 2:1 Cars.com to ATC in sales while it is 1:2 Cars.com to ATC on pricing. I can't make a more even playing field for both companies, so I have to assume (based on the hard numbers) that Autotrader.com is now half the product Cars.com is....Cars.com, feel free to quote me on that.

The thing that troubles me about the whole thing is Autotrader.com won't do anything for us to get the numbers more in line, so I will be campaigning to our 2 GM's that still want to be on the product to either cancel or justify the money. Thankfully it doesn't come out of my budget (it is a pure store-expense) but wasted money does bug me a lot.

I'm sure my rep will be reading this thread now, and I apologize to her. It is absolutely no reflection on her as she is someone who will put some real work in - I'd like to have her on my staff. I suggest working with Todd to help him find the deals if you want to shut me up on this one.
J
  • J
    Jerry Morris
  • July 9, 2009
Alex,
My post was not met to either defend or indict ATC. I worked for ATC for 7 years starting in Metro New York and finishing in South Florida when I left them last fall. Although I had issues over the years with the company, the people I worked with and friends that I made are still very dear to me. I am not quiet sure what Chip and Allan were trying to accomplish with their video, that however I won’t go into.

My passion lies with teaching and training dealers that the internet is not a static medium like traditional media, but a wonderfully useful medium that with a little inspiration and help from knowledgeable people can open a whole new world of people and customers to dealers. Dealers must realize that the success their granddaddy and daddy enjoyed in the traditional mediums available is no longer the case. These mediums have been supplanted by the internet. Because we live in“on-line society” marketing on the internet is constantly changing.

My last job in a dealership was 9 years ago; we had a very successful BDC because their job was to get people into the dealership. Once people where in the dealership, they were turned over to sales people to complete the sale. Early in my career with ATC I saw internet departments who tried to sell cars. The problem is no one understood the internet let alone computers. So originally the person put in charge of the internet department was able to turn on a computer, answer and email, and semi-talk on the phone. What this person was not is a salesperson. Given all this; dealers wondered why the internet did not work. Of course over the years professionals like your self have entered the field with very good results.

So what has happened over the last 10 years? The internet as come 180 degrees. It is the medium that everyone looks at for information. Traditional media still has a place, but not so much. The industry cannot become complacent it must embrace and grow with new technology’s. The funny thing is the more things change the more they stay the same. I currently am marketing a line of video players for web sites. With my players a dealer can personally welcome a customer to their website. They service director can welcome a customer to the service department. New and used car managers can video weekly specials. Customers can give live testimonials. Customers can send it there own videos using there vehicles, and much, much, more. I short people can talk to people. Wow, what an OLD concept. Plus the videos become viral, and are just as effective in moving dealers up in search results as PPC. However, what’s interesting is I still hear the same thing I heard when I was with ATC who is going to do this, who has the time? As this industry shakes it self out over the next few years, the dealers that find the time to do the right things will be the ones left standing.

By the way I always enjoy our articles. Have a great one!
M
  • M
    Mike Keesee
  • July 13, 2009
So i'm sitting here this morning, going through my daily emails and hoping to learn more about what is happening in todays automotive world and I give tons of credit to Jeff and Alex, their efforts in bringing to light the underlying issues. I just forced myself to watch that Auto Trader.com video, from Mr. Chip and Mr. Alan. Their line reading skills need work and the only thing I can remember from the video is that they are reducing staff and spending 3x the money in advertising.

ATC is on blast here a lot huh?

I have a great rep and her manager is great too. My numbers are very similar to what Alex said in his post. But, i'm going to take everything I can get right now, and to lay to rest the "ATC consumers walk in the door too!" My suggestion is to list your ad that gives a discount on the vehicle if they print something from ATC and bring that in with them. Perhaps that may help?

Ok back to work!
G
  • G
    Glen Garvin
  • July 16, 2009
Another great DR conversation. I read this again and again before now finally commenting. A lot of good opinions are expressed here and I've been dealing closely with ATC since they became ATC. I can speak directly that they have recently relaxed some of their rigid standards to become more dealer focused on accepting video content without trying to strong-arm the third party providers... a welcome change! Hopefully, this is an example of a new face of ATC.

Lets assume the once-arrogant ATC organization is truly working on redefining itself. If so, I wish them well in that monumental task. It has taken a long time to sell a message at change at some of our Dominion companies, namely Dealer Specialties. In our case, that task has been very difficult to overcome the experience that a particular dealer had with one rep taking poor photos or perhaps a poor technological reputation. While we offer many DIY tools and some great technology, the reputation still hangs there with some people. So that task will not be an easy one.

I think the bigger, long-term concern for ATC is the consumer experience. As a consumer, my experience is lacking - having to scroll through all the premium placed ads, for instance. That is an issue that they really need to spend some time on!
M
Hey Glen, ur right on.
We should go do that one greek diner in monroe and talk some more
-Sayre
J
  • J
    JS
  • August 3, 2009
Boring video. Now back to work. We canceled with AT.com, before they fired the fluff stuff staff.
J