Increase In Conversions

[BillKVMotorCo]

My curiosity is overriding my fear of seeing an increase in my Cars.com bill, but has anyone else noticed a dramatic increase in Cars.com conversions since around December 1st? Cars.com has consistently been our worst performing 3rd party source from a conversion standpoint even though they are almost always our number one lead source (we also use AutoTrader and Cargurus). It's usually a far third place finish as well.

Since around December 1st they've been our top lead conversion source even though we've not necessarily seen a dramatic increase in leads overall. We've not changed anything internally that I think would have caused this whether it be response times, frequency, how we respond, advertising, or pricing. Just wondered if anyone has seen the same. This message will hopefully self destruct before anyone at Cars.com sees it (I'm not paying more!).

 

[Alex Snyder]

Did you have a shift in inventory mix?

I may be a little dated, but had an epiphany many years ago between ATC and CARS. Our stores with lower average per unit costs performed better on ATC while the higher inventory average cost stores did better on CARS.

For example: Checkered Flag Hyundai had an average used car inventory cost under $16,000 per unit (this is 10 years ago) and attracted more buyers through Autotrader while Checkered Flag BMW had an average used car inventory cost above $24,000 per unit and attracted more buyers through Cars.com.

 

[BillKVMotorCo]

Interesting. I will take a look. In the middle of the summer while things were their craziest I actually noticed an inverse relationship between AT and CG when are pricing started getting higher. CG was our best for a long time, but that switched as prices got higher. I think everyone knows how that goes with CG by now. I will report back!

 

[Alex Snyder]

Now you've got me thinking a bit more on the current state of the used market, Bill. If my old theory still holds, then today's higher used car acquisition costs would make Cars.com a better performer. Essentially, I discovered there was a shopper looking for more expensive cars on Cars.com 10 years ago around Virginia Beach.

Obviously things may have changed and your marketplace mileage may vary. On top of that, CarGurus is now a player.

 

[BillKVMotorCo]

In case anyone from Cars is in here just remember what I did for your stock today.

 

[Jeff Kershner]

I've caught myself questioning this over the years while having to remind myself of all the possible variables. The first time I became aware of this was over 15+ years ago when someone priced used Honda Accord the wrong - way too low. The number of leads we received on that vehicle in a mere 24 hour period blew up my reporting for the month. Another time, several of our wholesale vehicles made their way into our feed for a few days and this also threw our reporting way off. Point being- inventory mix / market demand, pricing and merchandising can have a direct effect on leads and conversion.

@BillKVMotorCo are you tracking phone and walk-ins for these ad sources as well? We get some decent floor traffic and sales with Cars.com. I used to segment all sales outside of our local area and all sales that were off make - call and or email survey these customers to confirm the lead source posted in the CRM.