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[Breaking] Cars.com's Linda Bartman Responds to the Dealer Community

Linda Barman, Cars.com CMO, responded to the dealer community with an open and direct account of what has transpired over the past month with regards to the test email campaign.

First off, Linda apologized to the community for their lack of upfront communication with the dealers. She stated their goal is to continuously improve and innovate to create more value for both consumers and dealers. This is part of their core values and admitted that it's often difficult to balance the efforts directed to both segments. 

Linda also said they learned a lot from this test - most importantly the need to be more proactive and work with dealers to get more feedback and to share the results as well. (There are more than enough dealers who are willing to help in this capacity, the feedback Cars.com would be extremely valuable) 

Lastly, Linda shared the results from their test email campaign from the previous month. She said it was wildly successful; open rates for the emails were double that of the industry averages (40% vs. 21%) The majority of the value from these test campaigns was provided to the initial dealership to which the customer sent their lead. 

Cars.com's ultimate goal is to provide more value for consumers and dealers. More importantly, they are in fact going to stop the email campaigns. 

This experiement created some valuable lessons for both Cars.com and the dealer community. Just as dealers need to understand the power and strength of a connected community and the speed of information exchange, vendors must also recognize this phenomenon. It doesn't necessarily mean the information shared will always be accurate, but within the natural dynamics of our dealer ecosystem the information will be passed along - quickly. 

There is also a huge opportunity for dealers to improve their own internal lead management process. Up to 23% of all leads aren't responded to AT ALL. Dealers should be concered about what's happening under their own rooftops - they're missing opportunities as well. 

Let's all be sure we're working together the get the best information, from the best sources and ultimately make the best decisions around issues such as these. 

Thanks for sharing the update Linda, we look forward to hearing from you regarding the product development process happening at Cars.com! 

Watch Linda's video reply on the DealerAdvantage Blog.

Comments

This is exactly the response the community needed and deserves. Being on one side of the fence it's easy to forget that Cars.com has dual responsibilities... Dealers are 'happy' to fork over money to get leads but forget there is still a whole lot Cars.com needs to do to attract customers to get the leads and provide shoppers value in the first place.

Often times dealers are spending money with Cars.com instead of performing these activities themselves, which really puts you at their a 3rd parties mercy. This is why dealers HAVE TO take their own marketing more seriously and earn a healthy share of their own leads...Otherwise you are always at the mercy of a 'middleman'.

Kudos to Linda for the honest and timely reply before everything got completely out of hand.

May 2, 2013

There are allegations now that cars.com is reselling dealer inventory to dealer hostile websites like CarGurus! Any truth to this Linda?

May 2, 2013

I'm sure that took a lot of courage to "join the video discussions." So glad she shared!!

May 2, 2013

I have been told by a Cars rep that they send over a "skinny feed" to cargurus.

May 2, 2013

@David - any word on what their definition of "skinny feed" is...?

May 2, 2013

@Tim Dealers can opt-in/opt-out of the feed to CarGurus.

May 2, 2013

@Eric - I had the same question and was told "we send some of your inventory over but not all of it"

May 2, 2013

Tim, I'm the founder and CEO of CarGurus. I'm going to let Cars.com comment on their relationship with CarGurus. What I would like to comment on is your characterization of CarGurus as "dealer hostile".

In my prior life I was co-founder/Chairman of TripAdvsor - the largest online travel site in the world. We built TripAdvisor around the concept of information transparency - user reviews. Through the years TripAdvisor has grown to be an indispensable tool for hoteliers to market their properties to consumers.

Similarly, here at CarGurus we strive to bring transparency to the auto shopping experience. You might not know this but CarGurus has now grown to be the 10th largest automotive shopping site in the United States. Last month we had over 5.5 Million consumers use our service.

In addition to helping consumers, we strive to help dealers market their inventory to our consumers. We take seriously our obligation not only to consumers but also to dealers. Our shopping service is unique in how we rank inventory based on how far below the market it is priced – inventory with the most customer savings gets the highest ranking and exposure in our search results.

Let's be clear however, inventory market price validation is not a new concept. Our math modeling that automates the market pricing and inventory ranking is, but KBB, NADA Guide and Edmunds have been doing this in a manual data input form for many years. So we are no more "hostile" than these industry standard sites.

We work with a number of the top 10 national dealer groups and many, many smaller dealers. Why do these dealers work with us? The answer is quite simple. We help them sell a lot of cars. What is unique about our platform from a dealer standpoint is that the leads we do send on to dealers close at the very highest rate (to a sold car) because over 95% of the leads we send to dealers are for inventory that the consumer thinks is a great deal. Leads from our site are from very serious buyers.

Be it TripAdvisor, Zillow in real estate or CarGurus in Autos, information transparency is good for consumers and merchants. Consumers love information transparency and merchants love "serious" shoppers.

And let's also be clear about the fact that dealers run their own businesses. They can and should price their inventory as they see fit. In fact a dealer may have a valid reason for pricing their inventory above the market. Just because KBB or CarGurus says a car is priced over the market, there is nothing that says a dealer has to sell the car at a lower price.
The only downside to pricing your inventory above the market is you might lose out on some shoppers who migrate elsewhere.

Hope this helps clear up why CarGurus is not "dealer hostile."

May 2, 2013

Every month, my paycheck is affected by the monthly expense my dealership pays Cars.com. For pre-owned advertising, Cars.com is our best 3rd party online used car referral source, and also one of the few vendors that are eligible for co-op credit with BMW.
While I agree that Cars.com could have communicated better to the dealer community and perhaps offered more transparency in the data collection process, I also believe their decision to stop this practice was unfortunate. While many raised valid concerns, nothing could be proved as being as "devastating" as many proposed. While much of the debate could be proven right, it was largely based on hearsay. This was the proverbial "witch hunt."

Hearsay has led to a major loss for those of us that work in dealerships. Many of us launched a major and unfair offensive against a company that has a track record of placing the dealer's interests at the very core of their products. While every business must inherently have some type of self-serving interest(we are all in business to make money after all), the draconian allegations made against Cars.com were downright egregious.

In the end, our community should not engage in activities that only cause a rift between dealers, advertisers, and OEMs. This will only result in vendors choosing to stifle innovation, or even worse, vendors will choose to engage in non-transparent activities and avoid the "hostile" feedback of the industry. While I've been an open critic of many companies, including Cars.com, I've always tried to maintain a fair and balanced perspective that was representative of all available information.

May 1, 2013, in my opinion, is a day that will live in automotive marketing infamy.

May 2, 2013

Well said Jeremy. Unfortunate but I agree.

May 2, 2013

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