Who is your website built for?

By most accounts 90% of today’s car buyers will research their purchase on the internet prior to making a decision. The most recent industry studies show that these consumers will look on manufacturer’s sites, research sites, and dealer websites. Dealer websites are becoming the first stop in the process. However, the best dealer websites, while providing plenty of information, perform dismally when comes to converting visits to contacts. The best dealer sites are able to convince just 5% of visitors to click through. Why is the conversion ratio so poor?

Today’s dealer faces a myriad of choices when it comes to website tools. The vast majority of websites are template based which may then be customized with a variety of ‘bling’. However, manufacturers are increasingly putting pressure on dealers to standardize the look and feel, forcing many dealers to add a second (or third) website over which they have complete autonomy to differentiate themselves.

Website tools and Add-Ons:

There is video. Dealers often add a short clip of themselves on the lot, a video test drive or a view of the vehicle. YouTube clips, background music, car configurators, 360 degree pictures, allowing the user to reposition the photo with a movement of the mouse. Flash, moving images designed to draw the visitor in and engage. The talking ‘pawns’ that appear to emerge from the side of the screen and greet the visitor, inviting them to look closer. All of these visual add-ons seek to improve the browsing experience.

Online negotiation platforms are coming into vogue now. Is online negotiation good? Would any other industry consider selling products like that? No, but many old-skool retailers believe that customers want the haggle without the trip to the showroom. They don’t. Why duplicate the worst part of buying a car and port it to the internet?

Auction style format is a proven model when there are multiple buyers and sellers. But on an individual dealer site, it hardly makes any sense at all to bid against oneself up to the dealer’s minimum selling price, at which point the process ends. Other tools ask a customer to ‘name their price’ or ‘make an offer’, in these cases customers will either put in $1, or nothing at all. Why would anyone expect an online customer to ‘show their cards’? Just ask Priceline.com.

But what do these features do for the shopper? Not much. An internet car shopper is no different from other online shoppers; they want information quickly and completely. What information do they want? Price & Inventory. This is what drives the decision to contact or allow a dealer to contact. Price is disclosed and contact is made. However, this is simply Step 1. The internet brings the customer and dealers together; it doesn't create a buyer or sell a car. The car dealer that does that.

Joseph Antley

CEO RedNumbat

Is the bar low enough yet?

I had a very interesting conversation with a friend the other day that confirmed my beliefs about online car shopping. We were discussing how people use the internet when they're ready to buy a car. He mentioned that he had just purchased a car and how the internet helped a lot with the process. In fact, he said it was "Great!"

I wanted to find out more. Everything I've read about internet car shopping has pointed to inherent weaknesses, frustration and the proverbial 'run-around'. A recent industry survey found that 3 out of 4 car buyers had said that the process was unsatisfying. Polk, J.D. Power and others have found that online car shoppers are looking for several key pieces of information; Inventory, Price and Response. Seems reasonable enough.

Back to my friend. He went on to tell me about how he had first gone to one of the big "research" sites to find out more about his selections. Like most buyers, he had already narrowed his search to 2 vehicles. So after learning more about trim, options, MPG etc he settled on the Honda Pilot. He then visited one of the big "buying" sites to get a fast, free quote. He entered his contact information and hit 'submit'. While waiting for the fast, free quotes, he decided to visit the local Honda dealer's website. Then another, after all there was inventory to browse, video test-drives and moving images!

After just a few hours he received roughly 13 emails from 3 different dealers. The first several were auto-responses acknowledging his request. He never did get his fast, free quotes but each email promised that he would be contacted as soon as possible to determine:

1. The kind of car he wanted

2. What’s available

3. Schedule a test drive

4. Work up the price

5. Discuss finance options

Sure enough, the phone began to ring, despite the fact that he expressly indicated that his preferred contact method was email. He talked with 2 of the 3 dealers and decided to visit the dealer closest to his home. He was assured they had the color he wanted and the price would be great. So he went to the dealer, negotiated a price and bought the car.

How did the internet help? Why was this experience acceptable? If he were buying a camcorder would he accept this? I think not. Imagine having to go through this process to get a price and availability for a camcorder or a TV.

The bar has been lowered to the point where it is considered a 'good experience' to not get a simple price on a car without having to first speak to a salesperson. Virtually every other industry has responded to consumer expectations and has embraced the inherent benefits offered by the internet to improve the buying experience. From consumer electronics to insurance to real estate, the internet offers transparency, selection, anonymity, and research. And sales have not declined as a result of this consumer empowerment, in fact they have increased.

So why hasn't the car business done the same?