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From: Jared Hamilton
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Dennis Galbraith

Dennis Galbraith Chief Marketing Officer

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514f130080669ad679b023c13cde6791.jpg?t=1Today’s Automotive News quotes AutoNation CEO, Mike Jackson in a report saying AutoNation will move away from third-party sources and make its own leads. AutoNation is actually going to spend more money than ever on digital marketing, it simply is moving that money toward a better website strategy and more digital marketing, bringing shoppers directly to the site.

The first 18 years or so of automotive internet was dominated by companies like AutoTrader.com, Cars.com, kbb.com, Edmunds.com, and eventually Truecar.com creating consumer audiences. Third-parties either used their audience to create leads or brought subscribing dealer’s inventory to those shoppers. The latter system eventually dominated with the vendors adding value through a kind of matching service.

Today, search engines provide a superior matching service and consumers are responding. More and more shoppers are performing long-tail searches, looking for a vehicle via search rather than a site from which to find a vehicle. As dealers consider moving more resources to where consumers are shifting their search, they need to consider this is a two-vendor play. You have to pay for the search, either directly or through a digital marketing service. (The latter is often more cost effective.) Then you have to land the shopper onto a fantastic Vehicle Details Page (VDP) on a very good website. This combination can be far more cost effective that paying an automotive audience provider for their match-making service.

Thousands of dealers have gone at this half way. They either pay for a digital marketing service that is not effective or transparent, getting them burned, or they choose a good, transparent service only to land the shopper on a poor website with a poor VDP. As more and more of these searches are done on mobile devices, the dealer’s mobile site experience becomes as or more important than their traditional site.

Going where the consumer and AutoNation are going can make fantastic sense, but you must go all the way. When you see a company as big as AutoNation moving hard and fast in this direction, it’s important to stop asking whether it works and begin asking whether you are working it.

Jim Bell
HUGE HUGE move and HUGE statement by a huge group. Will be interesting to see if others will follow in the footsteps of Autonation. Will be interesting to see if they stick with this new advertising program. If they do, and others follow, it could be a game-changer for dealerships. A lot of dealerships (including myself) are scared to do it.
Dennis Galbraith
Jim, I recently talked to a dealer group that dropped all their AutoTrader.com and Cars.com in favor of search, retargeting, and other digital marketing. It worked out great for them. I think it depends on what you are paying on a cost per VDP bases, what your competitors are doing (e.g. driving up PPC costs), inventory, pricing policy, and other variables. I know stores competing on the basis of price do better than other stores on classified listings. Obviously, stores with great websites do much better than other stores with PPC, retargeting, geo fencing, and other digital marketing services. That said, there is no doubt about which direction the consumer is moving.
mark rask
Dennis, We are considering making that move as well.

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