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MyDealerOnline

"Sell Before You Buy"

Three’s a Party: The Role of Third Party Sites in Automotive Retail

Traditional automotive retail consists of two main players; the dealer and the consumer. Modern automotive retail consists of the dealer, the consumer and every other factor that now influences consumers' car buying decisions. From consumer shopping guides, to dealership reviews, to social recommendations on Facebook, we are given countless resources as consumers to guide our purchasing decisions in today's digitally-connected, review-friendly society. When it comes to third party automotive sites, three’s a party as they offer benefits for both the dealer and the consumer. This blog post explores the impact of third party marketplaces in the automotive retail sector and introduces an innovative solution for remarketing vehicles. 

Trends show that consumer shopping behaviors favor third party sites, utilizing such marketplaces as trustworthy and objective informational resources throughout the decision-making process. In fact, 2 out of 3 new car buyers, and 4 out of 5 used car buyers rely on independent research sites and marketplaces as a key resource in their car buying process.1 "Consumers like to comparison shop, and they want unbiased information that third party sites provide," stated Alex Vetter, CEO of Cars.com, at the 2015 Automotive News Retail Forum.2 As fragmented as the auto retailing industry is today, independent dealers continue to rely on third party sites to market their inventory. Third party sites allow consumers to view an array of inventory, shop around and find a good deal. Convenience is key for today’s consumer and the convenience of third party sites is rooted in massive amounts of inventory, avenues for comparability and reliable consumer reviews all in one place. 

 

For dealers, third party sites offer marketing opportunities difficult for independent, franchise dealerships to initiate on their own. Third party sites are today’s classified newspapers ads with better results. "Few groups have the size and resources to strike out on their own and create websites sufficient to try to attract all the business they need internally," mentioned John Krafcik, President of TrueCar, Inc.3 Third party sites allow dealers to reach a wider audience, generate leads and advertise their dealership. According to Driving Sales News, 78% of consumers looking for used cars are using a third party site in their search. Out of this 78%, they also state that 60% of the time that consumers spend going through the buying process is spent on a third party site.4 With such a high percentage of lead and sale traffic coming from third-party sites, why wouldn’t every dealer's strategy focus on broadcasting their dealership on these types of marketplaces? 

 

Well for one, third party sites require a quality leads handling process and consistent communication to produce profitable ROI. Let’s face it, marketing inventory on these sites does come with a price and in order to reap the benefits in return, they require a significant amount of management and attention on the back-end. It is important for dealers to remember that many third party sites do not necessarily consider themselves lead providers but rather inventory marketing channels.5  Given the sheer volume of consumers visiting automotive marketplaces on a daily basis, third party sites offer viable avenues for dealers to market their inventory. However, third party sites do not necessarily serve as the lead-generating power tool designed to solve all dealer hardships in automotive retail. In the past few years, AutoNation has placed less emphasis on plugging money into third party site providers and turned its attention towards brand building. "I can pay them to build their brands, or I can build my own brand," referenced AutoNation's CEO, Mike Jackson, noting that the significant fees and subscription costs for online lead generation through third party sites simply wasn't worth the cost.6

 

Given the interesting twist of third party site advantages and disadvantages for dealers, what about a tool that offers consumers a massive selection of inventory AND provides dealers quality, manageable leads through their OWN website? MyDealerOnline's revolutionary software does just that. An auto remarketing tool designed for dealers to offer a greater inventory selection without increasing their upfront capital finance requirements, MyDealerOnline aggregates auto auction inventory and places it on subscribing dealers’ sites for consumer browsing. Car shopping consumers are able to browse this inventory tool and inquire about particular cars straight through MyDealerOnline’s interactive communication platform. Dealers get real-time lead alerts and consumers get fast responses to their inquiries. MyDealerOnline's solution bridges the gap between wholesale and retail, an opportunity not available through third party site providers. To learn more about this unique concept, visit mydealeronline.com for additional information. 

Bringing the Auto Industry Up to Speed with Modern Technology

If you think back ten years ago to 2006, how much did you know about technology? Did you have a computer in your own home? If so, did you use that computer nearly as much as you do now? Chances are you depend more on the internet now more than ever before for various aspects of your daily life. Access to online bill paying, virtual GPS systems for directions, and even the real estate market are prime examples of the readily available features provided by the internet. There is one aspect of our daily lives, however, that has not fully taken the online switch over to the virtual side. That aspect would be the automotive retail industry.

In 2009, only a mere 4% of all automotive retail sales were held online and increased to roughly 15% in 2013. Compare these numbers to the 50% of online visibility that is held by industries such as publishing and entertainment, as told by Forbes.com. Because of this minor increase, there has already been a decline in the number of visits a consumer makes to the dealership before buying a car from 4 visits to an average of 1.4 visits.

Does this come as a surprise that in this short of a time period that an online presence can make this much of a difference? Consider everything that is readily available to the public on marketplaces like Amazon, as pointed out by AutoRemarketing.com. There are hundreds of thousands of products for low prices listed for the immediate purchase by consumers. This not only saves money, but time as well from driving to and from the store to waiting in line and taking the chance that the item you are looking for may not be in stock. This is no different than the pros and cons of the automotive retail industry. On-demand automotive retail platforms, such as ShowroomXpress, are merging the automotive industry with the new advancements in technology. ShowroomXpress showcases car inventory from dealerships to consumers through an online presence available at home and interactive kiosks present at dealerships and is being released to the public in the upcoming year. Much like ShowroomXpress, MyDealerOnline has a similar vision of how the automotive industry can be taken into a new era.


MyDealerOnline saw the opportunity of an online automotive presence and full heartedly took an initiative. By setting up an online platform, auctioneers and dealers can showcase their used car inventory that they have available on and off their lot. Consumers can conveniently see inventory in the comfort of their own home before taking the trip out to the dealership to ensure a successful transaction and long-term satisfaction. With so much of society being dictated online, it seems impossible that there hasn’t be a service offered like this before. Learn more about how we can assist you in the car buying process at MyDealerOnline.