It's a shame that far too many dealerships are more concerned with finding sales and service opportunities through 3rd party sources when they have a website that their customers can't find online. AND...when their customer's do find them online, they are forced to listen to cheesy jingles or Charlie and Chocolate Factory mini people talk about how great the dealership 'experience' is.

Goto Amazon.com, eBay.com, Google.com, BestBuy.com, Walmart.com, etc. and see what the biggest and brightest players online are doing. Try to emulate their Internet presences vs. trying to build a Walt Disney like experience on your website.

Here's a secret...consumers have better things to do than visit your website to listen your jingles and TV commercials!! They won't come back daily to 'check you out'. The WWW has far too many options for your dealership to become the online version of WallyWorld.

Step back for a moment and take your Internet advertising offline...

Do you spend a majority of your offline ad budget on off-site sales?

THAT IS WHAT YOU ARE DOING WHEN YOUR BUDGET IS GOING TO 3RD PARTY PROVIDERS!!!

Invest in yourself before you spend your money elsewhere. If your virtual dealership isn't the best it can be, why would you concentrate ANY effort on online portals?

Erica - you crack me up!

Can we please discuss how hilarious the graphic on this post is? Alex, where in the world did you find it - it is PERFECT! That might be the meanest thing said about ATC on the post! A picture is worth a thousand words!

Yourprofessor, your post is spot on! Why do so many dealers' websites treat inventory like a red headed stepchild? Dealers need to look at inventory listings like shoppers. And...dealers need to know that shoppers are finding them via Google. "xxx dealer (location) online inventory" will get your customer to your site, but what happens when they get there?

If I went to a store and all the inventory was in boxes, labelled "sweater" or "shoes", with identical little pictures (Stock photos) on them, and to know what color the items were, or if they were made of wool or leather I had to talk to a salesperson, I'd be out of that store in a NY minute. Yet many, many dealer inventories are like that. "ONLINE INVENTORY!! Yes we have a 2008 xxx, contact us to find out what color it is, what trans its got, what options are on it, list price...." I'm an unhappy shopper at that point.

The reason people research on the internet is THAT THEY AREN'T READY TO TALK TO ANYONE YET--THEY ARE "JUST LOOKING", at least in the beginning.Why do dealers bother with online inventory if they won't provide depth of information?

Frankly, Auto Trader has the same problem--wildly inconsistent levels of info provided. Try searching them for something with manual trans, for example. Half the time you'll get listings where the dealer didn't bother to list anything except standard equipment on their vehicles.

Shopping behavior is not just hunting, it's gathering...INFORMATION

Tranferring risk to the Rep is the best way to put it. It appears they are in the midst of a hiring frenzy. The turnover after the holidays will be enormous. I've been with them three years and have had enough.

"Do you realize that their new pay plan is based on procuring new business almost exclusively? They get nothing for RETAINING that business, but yet get penalized heavily if we cancel"

This is the EXACT pay plan used by Verizon Yellow pages (I sold YP for 2 ugly years).

This pay plan is built for driving numbers into a spread sheet and transfering risk (loss) down to the rep. It is the reason why turnover at AT is so great.

I have lived this pay plan and I can speak with confidence as There is no better way to destruct long term BUSINESS RELATIONSHIPS with your clients than to implement this anxiety ridden plan.

Lastly, if you're managing the Yellow Pages, you can get away with this pay plan, the YP market is so un-dynamic.

Joe

It is amazing how much is spent on AutoTrader. I used them in the used car business and it paid off in the long run. But that was 2 years ago. Now you are lucky to even make enough gross to foot the bill for Auto Trader. Many dealers don't realize that Auto Trader charges an extra $200-$300 if not more to have the inventory pushed to them, a few dealers may already pay to have it pushed through their resources they currently have in place. Seems like double dipping I see. They don't care, they want their $$.
As mentioned earlier in one of the comments investing in to your current site that is going to give you the ROI you deserve is the best thing to do. Investing in your SEO! 20% of the dealers now are starting to do that. Dealers get abused so much for trying to get that extra sale and not get nothing out of it from the big guys saying they have their magic wand!
I would not suggest AutoTrader, It really gets me to see so many ISM's and dealers out there that have a grudge on them. They made their own mark in the industry!

"Do you realize that their new pay plan is based on procuring new business almost exclusively? They get nothing for RETAINING that business, but yet get penalized heavily if we cancel"

We have no idea what their business strategy is or will be going into next year. It's all or nothing anymore, could be alot of nothing if they aren't careful.

The most unfortunate part of this lengthly thread is that a majority of dealerships don't understand what they are doing by participating in AutoTrader.com.

Without YOUR inventory, the 3rd party lead generating, portal business model doesn't work!! If every dealership shut off their inventory feeds to Autotrader.com tonight, where would Autotrader.com's website be tomorrow?

Here's an exercise...

1. Pick a vehicle from your website and copy it's VIN number

2. Paste the VIN number into Google, Yahoo!, or MSN

What do you see?????

Does the vehicle show online shoppers that the VIN number is parked at your dealership's URL (your virtual lot)? Or is your vehicle only visible on the 3rd party sites that you subscribe to?

Web Design 101 isn't being practiced by a majority of website providers in the Automotive Internet industry when it comes to your most valuable (and expensive) asset, your inventory.

Too many dealerships are 100% reliant on 3rd party lead providers because their inventory has been framed in using another 3rd party solution on their website due to their 'website' company not having an inventory module!! If your inventory is framed into a 'New Inventory' or 'Pre-Owned Inventory' section of your site, the ONLY chance an online consumer will find it is if they manage to stumble and fumble through your pieced together clunky website (very unlikely) or through an online automotive portal.

Here is Google's take on frames:

'Frames can cause problems for search engines because they don't correspond to the conceptual model of the web.'

Until customers in your market are able to discover YOUR inventory on YOUR website through the search engines, sit back and enjoy the price hikes from each of your 3rd Party Lead sources...or do something about it!!!

Make sure your dealership isn't cruising down the Information Superhighway in a 1972 Ford Pinto! The results are explosive.

AutoTrader.com is reading this thread on all levels. If you want to have a voice, post a comment.

I don't know what changes may or may not come out of this, but they're certainly aware of our grievances. From the proposal I just received, there is a major price difference from the one I heard before I started this thread. I'm still not happy, but at least they're moving now.

Since I now know, without a doubt, ATC is reading this thread I have to put in a good word for my rep. Despite all the hell I always put him through, he does a good job of standing his ground. Yes, he has been drinking the ATC Kool Aid, but he is much more professional than other ATC reps I've dealt with. I like my rep, but I'm still not a fan of the product....at their uncompetitive prices.

I'll never completely buy-in to a scheme that uses our name to promote itself while charging us a fee to do it (I call it parasitic marketing), but while this model exists I'm going to do everything in my power to keep pricing honest.

I will weigh in on this as well. As the decision maker for which third party companies we use and ultimately the person who is accountable for what we pay for these companies; I say it is about time for a change.

I have had a great relationship with ATC for years. I have always signed on whatever dealergroup I am working for or consulting with based on their market. But this latest price hike makes no sense and ultimately will result in the demise of many good ATC sales reps who recently underwent a pay plan change. Needless to say, the feedback hasn't be good and cancellations are way up.

Do you realize that their new pay plan is based on procuring new business almost exclusively? They get nothing for RETAINING that business, but yet get penalized heavily if we cancel. On top of that, they are now told to spew that ATC is a "advertising medium" instead of a Internet lead provider and should be gauged against newspaper and radio.

C'mon ATC, you are sending your reps, Sales Managers and Regional Sales Managers (yes, I have had all three in my office) to war with no bullets. Saying, "wave your guns, I am sure they will fear your power and flee"!

While I am at it, these companies need to quit thumping their chests and figure out more VIABLE and UNIQUE products to offer. By signing everyone up on ATC or Cars.com, it dilutes the chances of even getting seen, let alone contacted.

Videos are nice...mmm k.
Price drop is icon is ...o.k.
Banner ads that are shared with 18 bazillion others is ...so so
Credit apps that can't go into your CRM are a pain
Partnership packages aren't producing negligable results.

We need ways besides the typical, custom comments, pricing and photos to set ourselves apart. Give me that at a increased price and we will talk. Give me a watered down version of what I am already getting, for twice the cost and we are done talking.

I will probably have to cancel all stores over this.

Lastly, I ran a division off eBay for awhile that did Fleet remarketing. We were on top of the world. We could ask for all the money and get it. Companies would come to us. Just like when ATC used to say, it is your loss not being on our site, we did the same at eBay and it worked!

Now, eBay is realizing (maybe too late) that they can't continue to hike up fees and not keep increasing results and substantiate it by widgets. Now that we are all a little more educated and that there are more choices, there needs to be more value and ROI.

Come March 2008, I think Autotrader will re-think their scheme. Hopefully for them, it won't be too late.

That's interesting Eric. I have a meeting with my AutoTrader.com rep in about 10 minutes. BRB.

Simple solution-don't pay the increase.

My Autotrader rep socked me with an annual renewal for $450 more per month than the previous year. After looking closely at my contract, I discovered that our contract is open-ended, with no scheduled increases in rate. I said I was happy with my current contact and not to change a thing. After a few threats of "we can't offer you 2008 product at 2007 rates", they renewed my contract-at my original rate.

Good luck.

800 new staff?

hmm....400 in Atlanta (support, admin, techs, execs)
hmm.... 400 in rest of usa has to be outside sales force.
That's $24-30mill in payroll alone. >$2 mill a month.
Damn, that's a huge burn rate.

Ok, I hereby withdraw my guess that they're a seller
I now say they're rolling out a totally new platform to sell to already p*ssed off AT advertisers.

Dear Chip Perry,
I hope it's not another MyRide.com!

Joe

"There's an explosion of interest in online shopping," Perry said.
The only thing I've seen "exploding" from autotrader is the monthly rates. We're down 30% this year vs last year on calls alone. Who out there is really content with what they are receiving in relation to what they're paying these folks anymore? Anyone??????

Tim you're right they do read threads like this but will they realistically listen to their dealers this time around? I don't believe they will, but they should. I'm sure we've all spoken of Autotrader's rate increase percentages with our peers & w/our Reps but this time I've heard literally everyone that has an account with them bring it up in casual conversation about Autotrader.com at just about every opportunity they could when discussing internet advertising this past year or so. I'm also hearing the same sentiments expressed on here that I've heard in conversation with my peers about in the past year also and that's the declining ROI, most importantly I'd say the phone call numbers are way off compared to years past. They've got a tough climb ahead of them to justify the path they've chosen. Our dealership is considering what to do with our account right now and it doesn't bode well for them in having us swallowing the price increase they want this time around. Since they've lost Yahoo as an advertising partner how is this possibly going to improve the situation going into the new year? Any guesses as to that one?

T.J.: By making the comment "Big Deal," I was not at all insinuating that the DealerRefresh resource is a waste of time. Far from it actually, I think it is great that people from all over the industry now have a forum, thanks to Jeff.

When I say "Big Deal" I mean that is how I suspect the folks at ATC look at it. They know that the worst possible reaction by the majority of their dealers is a gripe on this thread. Dealers need to make the decision that AutoTrader is either worth the asking price or is not. And then stick to their guns in order to affect any chance for a policy change.

They'll need to hire at least 1000 because 200 of the folks already there will be out the revolving door by then. They have turnover like no other company you've ever seen before, it's like a disease that nobody in the company ever speaks of.

I have google alerts set up for many things I want to keep track of.

Here is one that just hit.

Link:

Friday, November 2, 2007
AutoTrader.com revs up its expansion plans
Atlanta Business Chronicle - by Justin Rubner Staff Writer

Atlanta-based AutoTrader.com Inc. is undergoing a major expansion.

The company, an online automobile marketplace owned by Cox Enterprises Inc., plans to hire 800 workers next year, 400 in Atlanta. Positions sought run the gamut from customer service and marketing to sales and tech-related positions.

AutoTrader CEO Chip Perry says AutoTrader has been expanding organically since being founded in 1997. But increased demand for Internet advertising -- especially from car dealers -- is leading to rocket growth, he says.

"There's an explosion of interest in online shopping," Perry said. "We're fortunate to be working in a category that's exponentially growing."

Erica,

I'm ready to take your challenge. We just had a meeting about how our past and present ROI with AutoTrader stacked up, based on our numbers - not theirs, and the "proof is in the pudding". They've priced themselves out of our threshold.

I guess I can add to the "tick tock..."

Phew....what a post and comments! I just spent a good 45 minutes scrolling through and reading everything! (Just don't tell my boss!) As I peruse through point and counterpoint (most of it being point, point, point) - I can't help but see the tiny tip of the iceberg poking out from the ocean of discontent. The question remains - will the iceberg surface or just sink due to fear.

Tim Morris hit the nail on the head - sure, ATC will read through this (as I know many of their head people already have) and be annoyed that some of their clients are complaining and then they'll look at each other and say what should we do? They will check their recent cancellations that are minimal in number and say - "Let's go get a drink! Woohoo!" Most all of those who complained suggested a solution - "cancel." Yet, I wonder, after your complaining - will you? Will you take your own advice or just hope the others posting will do it to help you out, so you don't have to worry about losing a few sales each month. Or waiting for Google Base to come along and squash the competition like a little bug and then they will run for President and then World Ruler for All-Time. (Google is evil - I am sure of it, but I can't wait for their phone) It's a bit like volunteering or donating - many of us assume the "nicer" people out there will do it, relieving us of the time commitment or dollar drain.

Perhaps this blog will do something more than just cause me to procrastinate doing work - perhaps it will cause a movement and cause dealers to take action instead of just feeling better by venting. It could be planned like the immigrant "work strike" where everyone cancels on the same day - that would really send a message. (Hopefully better than the poor immigrant work strike - that was a complete bust! They're still getting carted back to Mexico by the truckload) Just think of the article Cliff will write in Ward's "Hundreds of dealers cancel Autotrader.com- prices slashed"

I can't wait to see who really goes through with it and who slinks off the comment thread knowing they will not...tick tock

Along the same lines as TJ "Long story short: AutoTrader knows that the worst thing to happen to them from their rate hikes is that a bunch of dealers show up on DealerRefresh to complain about them. Big deal":

The insane rate increases year after year work for Autotrader because the increased revenue from dealers who stick it out will always outweigh the loss of revenue from cancelled dealers. After the dust settles, some of the cancelled dealers inevitably go back and voila: Autotrader is even further ahead in recurring revenue than before.

Case in point: I worked at TraderOnline (owned by Trader Publishing) when BoatTraderOnline.com literally doubled their rates across the board. Even dealers who signed up a week prior got a letter in the mail saying they had to pay twice as much as what they signed up for last week. The thinking was the same: the site does generate enough business to justify the costs, and although some dealers cancel because they're ticked off, the number of dealers who stick with it outweighs the cancellations and there is still a net gain for Trader.

The difference between Autotrader and BoatTrader though is that at the time BTOL doubled their rates they did not have any competition. Autotrader DOES have competition now, and from the dealers I've been examining lately the other classified sites are producing a better ROI for half the cost.

As I mentioned earlier, imagine if Google improved the Base site features, pushed it out of Beta phase and actually decided to market & sell the sites features for half of what autotrader.com's rates are, it could crush them. Some autotrader execs have got to be reading this and wondering why there are these concerns regarding their price structures. It's because were tired of paying inflated rates for an audience size that really hasn't grown in pace w/the rate increases nor have the features paid off in delivering more eyeballs to our vehicles hence haven't done a hell of alot with ROI for us. We are basically salivating for the better mousetrap at half the rate, build it and we will come!

If you think AT has more of an audience that Google does, you are sorely mistaken. I work for a dealership website company and I can tell you jumping on googlebase first was one of the best decisions we ever made. Guess how much we charge for googlebase? That's right, absolutely nothing.

To stay in the game these days, you have to move away from 3rd party lead providers and start getting your website with easy to find inventory placed well on search results. If a customer sees your name in the pay per click area and on the organic results, you are almost assured to get a click at the least.

The price of doing this compared to paying AT or any other lead provider a ridiculous sum of money plus the cost of the lead is a no brainer.

I agree and have also made other dealerships we have relationships with aware of this thread. Alot of dealers I've spoken with in the past year or so all mention the absurd percentage of price increase from this company, be the dealer a wholesaler we deal with that has a small retail lot to the enormous multi franchise dealerships we trade with, everyone mentions the enormous price percentage increases and the lack or little service they ever receive from them. If we saw 50 to 80% increases in ROI we wouldn't mind paying for it but this is hardly the case. If I was a gambling man I'd also be willing to venture they're going to be put up for sale soon because based on what I've seen & read on here it certainly seems they maybe heading that way.