Overview

This buyer's guide overview is designed to offer insight and advice for those who may not be familiar with this category, as well as help guide dealers in their decisionmaking process. It is not designed to endorse or influence readers but simply to educate.

What is Inventory Merchandising?

Inventory merchandising is very simply creating a compelling vehicle description page (VDP) through the use of (text) descriptions, images, video and other calls-to-action. A dealer's inventory is their most valuable asset and how a dealership advertises its vehicles can mean the difference between a sale or not. Customers are increasingly visiting more touch-points on their car-buying journey and encountering multiple similar vehicles for consideration. With most dealerships being competitively priced, the ability for a dealer to compel a customer to choose their vehicle over a competing dealer could very easily boil down to how the vehicle is presented whether that is on their own website or a third-party listing site.

Considerations in Choosing an Inventory Merchandising Solution

There are essentially two fundamental avenues that a dealership can choose when making an inventory merchandising decision. A dealer can choose to do it themselves, or dealers can outsource the merchandising to a vendor partner. There are pros and cons to each decision and the size of the dealership or group will certainly play a part in the route a dealership chooses.

  1. Do It Yourself

    Depending on the volume of vehicles that a dealership has in stock and turns, a do-it-yourself model could certainly be a viable and inexpensive option. Keep in mind, however, that even dealers who choose to do it themselves will need a vendor partner in order to upload descriptions, images and other media for distribution to their website as well as all of the third-party listing sites they subscribe to. This option can involve equipment ranging from minimal expense to full-blown studios and production areas. In addition, a dealer should consider the man power and time it takes to properly represent the vehicle through images and video, and also how quickly the vehicle can be processed upon acquisition when it's ready to be added to the front line after recon and detail.

  2. Inventory Merchandising Vendors

    These vendors are professionals who typically visit a dealership regularly in order to photograph new inventory. They will then upload those images and/or video on behalf of the dealer to a distribution service for distribution. Inventory Merchandising vendors will typically offer a range of services including different image quantities per vehicle as well as video options. The frequency of visits is also an important consideration when choosing a partner, as that will affect how quickly a vehicle is properly represented and marketed on the Internet. Most vendors operate on a per-car cost basis and that cost can vary depending on volume and frequency.

The frequency of visits is also an important consideration when choosing a partner, as that will affect how quickly a vehicle is properly represented and marketed on the Internet.

Inventory Merchandising Considerations

A mentioned earlier, a vehicle detail page is extremely important to attracting customers. Regardless of whether a dealer chooses the do-it-yourself route or partnering with an Inventory Merchandising provider, dealers should know and consider the following when making a selection.

  1. Images

    The quantity and quality of images is of extreme importance in properly representing a vehicle online. Most dealers will have at minimum 20 pictures with the average being around 40. Dealers should also take into consideration whether images will be taken of their new vehicle inventory alongside their used vehicle inventory. This can, of course, increase the cost of the service but many consumers find actual images of new vehicles more appealing than simple stock photos.

  2. Video

    Video is an increasingly attractive medium to include on a VDP as consumers are more likely to watch a video of a vehicle than click through 40 or more pictures on by one. There are a few types of videos that can be used and dealers should decide which they plan to implement on their vehicles.

    1. Stitched photo videos

      This form of video takes the images of the vehicle and compiles them into a video form. Some stitched photo videos can include branding and in-video interactive callsto-action, as well as music. These are typically automated once images are uploaded and take the least amount of effort.

    2. Live video

      This video type would entail live video walk-arounds of each vehicle. They can range from quick walk-arounds of the interior and exterior of the vehicle with no sound, to complete walk-arounds that include explanations and selling features similar to how a salesperson would show a vehicle to a customer on the lot. This type of video is more time intensive but is also an option that many Inventory Merchandising providers offer at an additional charge.

    Dealers who choose to use a vendor for their merchandising efforts should understand and inquire about the process used by the provider as there are multiple methods that will result in both a large quantity of images as well as live video of a vehicle. The first, and most time-intensive, is for multiple images to be taken first followed by live video. Technology, however, can take a live video and extract as many images from the live video as the dealer desires. This is much less timeintensive, results in more images and should result in a lower cost per vehicle.

  3. Vehicle Descriptions

    Dealers should inquire as to whether an Inventory Merchandising provider will be providing vehicle descriptions for each piece of inventory or whether the dealer will need to do that themselves. Vehicle descriptions help tell a vehicle's story and can add to the attractiveness of a vehicle to a buyer. By default, many vehicle descriptions are simply lists of features; options and packages reading like the Maroni on the vehicle's window. Good vehicle descriptions can certainly contribute to the impact any given vehicle's VDP will have on a potential buyer.

  4. Frequency of visits

    The faster a dealer can get images and video taken and uploaded, the faster that vehicle can start attracting interest from buyers. Many studies have shown that the speed at which images and video are included in a VDP directly reflects a dealer's turn rate. An important consideration when choosing an Inventory Merchandising provider then must include how often they will be visiting the dealership to take the images and video.

  5. Data Distribution

    Every Inventory Merchandising provider will have software services that they use to upload images and video on behalf of the dealer for distribution. As vehicles sell and/or are added to inventory, the amount of time it takes for that distribution or update is directly connected to how often the distribution vendor being used pulls the data from the DMS. Some data distribution vendors will only update a dealer's inventory once per day while others are willing to update inventory and pricing every hour should the dealer wish. The Inventory Merchandising provider should know the capabilities and frequency in which the data distribution service they use is able to deliver.

As technology continues to evolve, some Inventory Merchandising providers are offering media such as Virtual and Augmented Reality as well as 360-degree images. While these technologies are relatively new to the market, a dealer may want to inquire as to whether these services are currently available should they wish to deploy them.

As technology continues to evolve, some Inventory Merchandising providers are offering media such as Virtual and Augmented Reality as well as 360-degree images.

Conclusion

In summary, dealers will need to merchandise their inventory. The considerations and descriptions above are meant to serve as direction for a dealer in making a decision on which inventory merchandising solution best fits them. In choosing an Inventory Merchandising solution provider, these considerations should be taken into account based on the budget, needs and desires of the individual dealer. Obviously, the more features a dealer desires, the more they should expect to pay a vendor on a per car basis.

The Inventory Merchandising vendor ratings on page 14 are designed to help a dealer begin their decision making process with information on verified dealers for each solution provider.