Hint: It involves implementing a digital retailing strategy with messaging woven into it. And we’ve got a guide to help you make it work. SEE HOW
On any given day, 17-18% of used-vehicle inventory posted online by dealers has no photos. Virtually every dealer realizes the critical nature of photos. If there is no photo showing on the Search Results Page, that listing has very little chance of being selected for the viewing of a Vehicle Details Page. Nonetheless, more than one in six vehicles are standing naked in the face of tough competition.
Even some of the largest, best known dealers have a poor record when it comes to merchandising their vehicles quickly. Last night, Sun Chevrolet had 33% with no photos, Paragon Honda 27%, Galpin Ford 12%, and Longo Toyota 10%. Mighty CarMax did little better than the national average. From a random sample of 10 CarMax stores, the percentage with no photos averaged 16% and ranged from 9% in Burbank, CA to 26% in Charlotte, NC. The point here is not to pick on any store but to point out that the problem is going unnoticed at even some of the finest stores.
The two best stores I've found so far are Texas Direct Auto (6%) and Finish Line Ford (3%). I track Finish Line Ford regularly, because I know they understand the importance of getting vehicles merchandised quickly. On most days fewer than 2% of their vehicles are without photos. I'm convinced that 2% is a reasonable standard for any store. If the vehicles are not merchandised online, then it is not much of an exaggeration to say they are not really for sale, even though the flooring costs and depreciation are in full swing.
Time is the problem. As the numbers below indicate, most vehicles get merchandised eventually. The problem is that it takes too long to get around to it.
Age of Listing Percent with No Photos
1 Day 87%
2-3 Days 60%
4-7 Days 41%
8-14 Days 29%
15 Days to 1 Mo. 15%
More Than 1 Mo.
Vehicles often wait days or even weeks for merchandising. Commonly, one person is in charge of taking the photos, whether they are an employee or outsourced. When they are not there or unavailable, the vehicles stand naked online and wait. Another problem is detailing and reconditioning. The best stores process nearly every vehicle in just one or two days. Better yet, photos are taken at the time of purchase and later replaced after detailing or reconditioning.
The solution to both of these problems is simplicity. When the process is so simple anyone can do it quickly and easily, then the vehicles get merchandised the day they come in. When involving human labor, the path to speed is simplicity. Engineers have understood this for over 100 years. Assembly lines break tasks down to their simplest form. Similarly, batch work can be segmented and distributed to specialized teams. But both these systems require volume. Tasks like used-vehicle merchandising, where one person tackles a series of differentiated vehicles, requires automation of the process instructions. Merchandising a pickup truck is different than merchandising an SUV or a sedan. Simplicity is achieved by automating the process instructions to fit the job and allowing the device to guide the person rather than the other way around. This method is similar to a GPS providing specific instructions based on the travel objective. Any number of drivers can follow the directions with little trouble and no need for thinking through the changes when the next objective is different.
The research for this article was done on October 30,2011 using the over 1.3 million cars listing on Cars.com by dealers only. Since the inventory feeds going to Cars.com are generally the same as the majority of feeds going to AutoTrader.com, and website providers, it is a good representation of the industry as a whole. This research can be duplicated at any time using data and filters that are publicly available on Cars.com. Results vary only a few percentage points from day to day. My hope is that this article can stimulate action that will move these metrics over the month ahead. This is not a zero-sum game. When inventory is merchandised faster inventory turns improve for everyone participating in the change.