In our latest conversation, Brett Hall, VP of Sales and Marketing at EMG, discusses how to succeed on connected TV and streaming.

What are dealers doing to differentiate their brand?

We are seeing, probably for the first time in four years, is a more balanced equilibrium between demand and supply in the space.

Of course, when COVID started, there was a lot of just fear and a lot of marketers pulled back. They weren't sure what was going to happen, or I should say dealers pulled back on their marketing. Then of course, we had the supply chain crunch, thought that was kind of out of the woods and then you have interest rates. There have been a lot of distortions in the market.

What we're observing is dealerships have to be competitive again, and they have to think strategically about moving inventory, basically as they did in pre-COVID. It's no longer the case, they can just have a car, sell it, and at a markup. They have to be better and more strategic.

So we see dealers really leaning into now, and it's a primary benefit of the space we operate within streaming is, that they're being much more strategic with an audience-first strategy. It's not just about put the ad out there and I want to try to have a certain number of channels or apps, that don't exist, we can talk about in a minute within the streaming space. We want to be much more strategic in aligning a creative message with an audience that we can resolve and target within the streaming ecosystem. They're being much more diligent about flighting creative to a certain audience at a certain time and being good about giving us different creative to manage that aligns with the things and the capabilities we can do.

And we're seeing various outcomes from that, whether it's more awareness of the dealership or the brand, more lead generation, more foot traffic, and increases in market share. Now they're really able to spend their dollars very efficiently and get more traction or more bang for their buck with that enhanced top of mind strategy, which again, is going to be an audience first strategy that is accommodated within the streaming ecosystem.

The value of connected TV and streaming.

We are continually surprised by either the lack of awareness or just the lack of inclination to really fully take advantage of the precise targeting options that exist in our space. It sometimes comes as a shock is, you know, we're not just going to be able to target a demographic or use, let's say a particular app or set of inventory, meaning ad inventory to get in front of a certain type of demographic and audience. We really can just go right after the person who's in market for a car right now, by class, by type, by model, et cetera.

And that's what I was saying earlier about really, because now the inventory is starting to stack up because they're starting to feel the pinch. They're really leaning into, they have more pain, they have more pain. And so they're more, they being the larger kind of ecosystem are more interested in leaning into those capabilities and those conversations in a way that we really hadn't seen before.

And so now the, the demand for the capabilities catching up to the actual capability that's existed for some time, but that is a huge, that is the differentiation between streaming and traditional, the targeting and the attribution that comes along with it.

How should a dealer approach advertising on connected TV?

In most cases, what we'll call it the, the demand ecosystem, those that are spending the dollars, whether that's an agency or a dealership or a group or an ad association, the way that they would articulate a strategy, what they want, what they're hoping to achieve largely was rooted in the tactics that you would use in traditional advertising.

So that might sound like this, I'm interested very kind of prototypical, stereotypical example. I'm interested in selling more trucks on my lot. Men generally buy more trucks than women. I need to get in front of men. I need to be on ESPN plus, just as a really simple example.

And what, that's the surprise factor, which is, you know, we actually are flipping it. We're not using the app, the content, the inventory to try to get in front of a certain audience using demographics. We're actually first creating an audience it's, you know, it's an audience for strategy. We are creating an audience of consumers who we believe with a high degree of confidence are in market for the type of car you are selling right now.

And we are going to activate that audience. We're going to target that audience into an array of streaming apps and ecosystems that independent of what we think about that alignment, meaning you're trying to get in front of men, but the Bravo app is streaming the bachelor doesn't matter.

We believe a car shopper, we know a car shopper because of our audience is streaming a certain piece of inventory or content. And we are going to let the data, the audience drive where and how we buy certain streaming inventory.

We still get this question a lot. Why is this app inside of my targeting mix? If I'm trying to go after this type of consumer, right?Maybe I'll mix it up a little bit. Why am I seeing a Bloomberg TV, which typically you would think is more going to attract and engage an affluent high net worth individual? Why is that in my mix when I'm selling an economy sedan? And it's like, well, you know, someone who doesn't, you know, who makes, you know, the median income who, you know, has a, has a good job, but not, you know, some crazy C suite one is really interested in financial news and they watch, they watch Bloomberg. You know, we can't really control that.

What we can control is getting that message with that audience in front of them at the right time.

And so to answer your question, it's hard to say if it's a lack of awareness or it's so rooted that their belief system is so rooted in, in how TV worked before and how targeting worked before. And so it, I think without sometimes they even knowing it just assume, well, that's how it's going to work here. You know, it largely is the same consumer experience.

The huge difference is what's happening behind the scenes because it's connected to the internet. We now can take advantage of all the digital technology and capability that allows us to do targeting, allows us to be audience first.

And so really moving their understanding and really stressing that this isn't ethereal. This is possible. It will create wildly better results and there is immense opportunity and value to be found if you can break away from the old way of doing things or the way that they were done in traditional.

How does a dealer get started?

Well, the short and the simple answer to get started with us in this space is actually pretty simple. We need to know what your dealership is literally just the name and the address. We have every dealership in the country franchise dealership database in our ad system.

We then would need a piece of creative to flight and that's where our agency partners come into play along with giving us other inputs along strategy that's happened in other ecosystems. So there's parity and synergy between them.

And then using the vast amounts of data, both public and that we've curated over the last seven years, we create a tailored strategy for your dealership.

So I'll unpack that a little bit. I'm sitting here in Orange County, California, more specifically Irvine, California. There are two Mercedes dealerships about four and a half miles away from each other. Same PMA, certainly the same state, the same county, practically the same city. They're four and a half miles away, but because we have database and are understanding things like what's your sales footprint, what's the OEM, where and how much do you sell cars outside of kind of a general footprint of your backyard, historical trends, foot traffic, all the media data that we've collected. We're able to prescribe two very different strategies to the same OEM practically in the same city.

It's because they have, like I said, different characteristics of, let's say, how many cars they sell, how far away do people come to their store? The two stores I'm thinking of specifically, one's kind of the Mac daddy that everyone goes to practically if they want a Mercedes. The other one is sort of a little brother. The strategy that both of those stores need to employ is very different.

And so what we try to do is understand where each dealership is today, and then reflect back to them a strategy that will help them move market share, traffic, increase sales, increase web traffic, et cetera, prescribed to who they are and where they are right now, with the anticipation and the hope that we can help improve your overall position in the market.

Transitioning from traditional to connected TV and streaming.

I think a lot of times, brands, dealerships, associations, they sometimes overthink it. They think that because now we're in a connected ecosystem, a streaming ecosystem, that the ad experience is wildly departed or different from what they're doing typically already in traditional.

And so where we kind of help make them comfortable and dip their toe in the water, we typically start by saying whatever ad, whatever video you're using in traditional, let's start with that. Let's start with that because while we're starting with the same creative, which generally is pretty good, like it's been well-produced, it's well-made, it has a good message that's been honed over years, we're keeping that the same, but then what we're changing obviously is what we're doing with that creative.

We're employing an audience-first strategy. We're able to figure out where we should be buying ads based on where people are streaming, who are in that market, how that we can target them using all the different controls that exist and even better, we can report on what happened when they consumed an ad that we put in front of them. What did they do? Did they go to your website? Did they go to your dealership? Did they go to someone else's dealership? Did they buy? Is your market share moving? Is it down? Is it up? All of that because again, at the end of the day, it's connected, it's internet-based, it's internet-enabled, we get the benefits of digital.

So I like to say the consumer experience is largely the same. There's obviously a difference in how you're consuming the content.

You're turning on your smart TV, let's say a Roku. You're hopping into an app, not a channel like Hulu, and you're typically pulling up a video-on-demand library. Sometimes you're watching TV live, but we'll kind of save that for another day.

So from a consumption standpoint, it's a very similar experience with the added benefit of I get to watch what I want, when I want, but from a marketing, from a targeting perspective, it's a whole new world of opportunity.

Reporting and attribution.

With our history as a company with direct response advertising and just having very outcome-based kind of approach to any marketing ecosystem, including streaming, that was key for us, and we use that old adage, you can't manage what you can't measure.

So we fundamentally approach the space with the premise, we have to be able to understand what is going on and the impact that we're having, good or bad, or neither, on the market that we're putting that message in front of. And so there's been an evolution, no pun intended, in what we've been doing, what we're able to track, and principally that starts with so that we can understand the true value and impact that our marketing is having on behalf of the dealership.

And so very kind of reductively and practically having accurate, truth-seeking attribution, not just producing the biggest number that you can or an inflated one, but really getting a good grasp on what is happening once I put my message out there.

Let's just start with how many homes am I reaching? How many of those homes are taking an action? How many of those homes are taking an action that tells us we're swimming in the right pond, but they're actually not visiting or engaging with the dealership that we're supporting? What's going on here?

And then we can, because again, it's all digital, we can have a very precise understanding of what's happening, what's called a bid stream level without getting too technical, but every single impression delivered on connected TV has data and metadata associated with it. We can take that and really get a fundamental understanding of what's going on and then optimize to it. We can separate the wheat from the chaff as it exists from an audience standpoint, from inventory, this inventory is not working very well, we got to cut it, we got to bid less for it and so on and so forth.

And so we think of attribution as really the foundation that everything else we do is built on. It's how we know if we're doing a good job of getting in front of the right audience. It's how we know if we're doing a good job of not only buying inventory, but at what price is it worth buying because we can extract what kind of value it has. Which devices at which time of the day make the most sense to put a message in front of someone?

All of this is available if you look and have more importantly, a foundational accurate attribution framework and system in place. From there, so really for us, step one, get attributions, choose, seeking and accurate. And then from there we can do a lot.

Step two, or really value number two is, okay, now we have a really clean way of optimizing or we have a really good feedback loop so that we can optimize our campaigns.

Number three, second part of your question, reporting. That attribution now can be turned into customer facing reporting to give them an idea of how it's going. And what I would say is what we're trying to do is a lot of the reporting that we studied when we kind of entered the space, would say it really told the story of what we did, not how did it work.

And we try to get to the bottom of, here's what we did.

Here's how many households we reached. Here's the creative that we did. Here's how many impressions you've got. Here's all the inventory mix you had. This is the audience we targeted. But more importantly, here's what happened when we put that message out there.

What is the difference between connected TV and streaming?

And it's kind of evidence to the immaturity of the market, right?

The terms and the acronyms, and even those are kind of all over the place. And what do you mean? What's the difference here?

So at least I can speak for us. So when we refer to streaming, we are referring to any digital medium, any medium, typically the ones that are traditional, so TV and radio, that streaming is the counterpoint to those in a digital landscape, meaning instead of an airwave or a satellite dish or your cable box delivering your content on TV, the internet is now.

Instead of radio waves delivering a signal to your car radio, the internet is.

And so streaming for us refers to specifically connected TV, which I'll unpack in a minute, and streaming audio as advertising medium. So it's sort of an umbrella term that we use. Now sometimes people interchange streaming TV and connected TV.

I'll kind of get to that in a minute. But we generally refer to it as streaming because it kind of captures a few different mediums, like I said, namely connected TV and streaming audio.

Connected TV, which is really the one that's kind of newer and getting all the press and everyone's talking about. Connected TV, as opposed to OTT, which I'll unpack in a minute, connected TV really fundamentally refers to a device that's connected to the internet where the content that's consumed on that device, shows, movies, sports, however you get your content, that's delivered via the internet instead of, like I said, a cable box, a satellite, or a pair of bunny ears. So really it's just talking about how that device, a TV, is able to get content in front of a consumer.

Connected TV, OTT, which again, this is where it's like, oh my gosh, OTT, CTV, what are we talking about here, OTT is really long form content that could be delivered on a TV, but also, you know, it could be delivered to your phone, a tablet, a desktop. We like to talk about connected TV because of the value that it has as a device, as a living room experience on the performance of a campaign, I'll get to that in a second. And so again, connected TV refers to a device that then is able to get content via the internet.

Typically the experience here is I have Roku that's connected to my TV, I jump into it, I see Netflix as an app that I open up and I start streaming Stranger Things, or whatever your show is of choice.

Streaming audio is fairly similar. It's the counterpoint to traditional radio, think Spotify, Pandora, streaming music, podcasting, which is just becoming, you know, ever-present news. Any audio content that you consume, typically on a mobile device or a home device like an Amazon Alexa, is streaming audio. In both these cases, they both are ad-supported, or there's at least an ad-supported constituency within that ecosystem, and that's where we come in.

So we're able to put an ad, you know, in flight to an ad-supported ecosystem like Paramount Plus or Netflix or Disney Plus, which, you know, we can unpack a little bit later. Now, all of these streamers who formerly did not have an ad offering, they do.

And so now there's just this ever-abundance of kind of ad availability that is just opening up so many possibilities for marketers, including dealerships.

What is ad spoofing?

.So you know, taking a step back, once in any industry, you know, I don't care what you're talking about, once it gets to a certain size and threshold, is when the scammers start taking notice. So you have a tiny little industry that, you know, isn't really worth anyone's time, fraud and spoofing and all this other stuff, it doesn't really apply.

For years, your, you know, Apple computer was really not susceptible to bugs or to malware or to other malicious hacker activity, because it just wasn't a very big piece of the market share of computers. That's different now, that's changed because there's so many more Apple computers out there.

So once something becomes big enough, that's when the fraudsters and the spoofers come into play. And so now connected TV and streaming is, I'll try to keep my words, now that connected TV specifically is roughly, we'll call it a $25 billion a year industry. There's a lot of fraudsters who have woken up to, hey, I can go do my thing and fraud unwitting consumers or customers into, you know, my game.

App spoofing is simply a scammer presenting a app as something other than it is. They are presenting that whatever they're selling is Netflix when it's not.

And there's a few different ways you can do this. It's actually not terribly difficult to do if you know what you're doing.

And so now that the industry has gotten so big, it is increasingly becoming a trend to be aware of.

It's one of many different types of inventory issues, whether you want to squarely call it fraud or just non-performance that you want to be aware of.

And so going back to attribution and why it matters, if you have a systematic infrastructure set up that you are tracking the outcomes that your ads are producing, whether it's just outright fraud or just inventory that just isn't producing because people just aren't watching, whatever the reason may be, we would just simply stop buying.

And this is why really a huge takeaway I would say for anyone operating in space, this one or anything else is don't just be reliant on, oh, it says Netflix, good to go. Hey, I'm getting the report that says it's Netflix. Independent if it says Netflix or not, or whatever the inventory might be, independent of what the audience might say, how is it working? Like what are the outcomes it's producing?

And if it's having subpar outcomes based on what you're able to track with your attribution stack, there's a problem.

Whether or not it's app spoofing or something else.

Where are connected TV and streaming heading?

So at an industry level, independent of automotive, and then I'll kind of tie it into automotive, at just a pure streaming level, it's a very exciting time.

I mentioned earlier, every single major streamer now has an ad tier. They are now really actively engaged within this experience. It's interesting, if you look at the history of traditional TV, it started with an ad supported ecosystem first, and certainly with the networks, NBC, ABC, CBS, ad supported. That's how it was funded and subsidized. And then we'll call it in the late 70s, 80s, 90s, you had premium subscription based, the HBOs of the world, right?

No ads, you pay a price, whatever that is per month.

Streaming kind of started with the inverse of traditional TV. It actually mostly started with a subscription based model, we'll call it the premium model. Pay 15 bucks a month for your Netflix account, no ads, stream whatever you want whenever you want.

What's happening now is subscription fatigue. Consumers, including my household, we're just sick of paying for all these individual apps and other content providers, because it's adding up. And so now they've all been forced to have an ad tier, even despite the ones who said they never would, namely Netflix. They're now introducing ad tiers and the adoption rate on those is, I would say, much more and happening much faster than I think anyone predicted because of that fatigue. And so now, the big ones in the last year, Netflix, Disney+, Amazon Prime, those are kind of your big three. They all now have ad tiers.

Not only that, they are now making it very clear, this is a big part of our business. This just isn't sort of this thing that we're doing on the side that generates incremental income or revenue for the business. This is a big part of the offering. And so what I would say now is it is really ushering in kind of that last kind of, I would say, the early adopters have already kind of been in the mix with connected TV advertising. And now I think it's really gonna push that mainstream adoption because now the big brands that people know are starting to come into the space.

And so what I would characterize right now and probably for the next few years, this is the golden age of streaming.This is like Facebook ads circa 2010. They just came online. There's this huge supply of inventory because everyone's on Facebook and getting accounts in the droves, but there's not many marketers there.

The balance of demand and supply from a marketing standpoint and streaming is somewhat imbalanced. There's a lot more supply right now. And what I think is gonna happen the next few years, that demand is gonna catch up. So right now it's just this golden opportunity for the ecosystem, for any marketer that wants to jump in and get involved in connected TV advertising.

What I think is gonna happen specific to automotive is, you kind of keyed into it, 2018, 19, those were the first real murmurings of OTT or CTV or whatever acronym you wanna use. And then what happened? COVID happened in 2020 and all the distortions we've talked about.

And so what's interesting is, as streaming was starting to get momentum and growing, the automotive industry was sort of in this unique time period where in some cases dealerships thought and rightly so, and didn't really spend that much on marketing at all. Why would I? I don't have many cars and the cars I do have, I'm selling for 15, 10, 20% above sticker. I don't really need to commit to an advertising mix. And so when they did, either because they were being strategic and really wanted to understand a new medium, or because they had some co-op money, whatever it was, and they did commit to streaming, my experience has been, our experience has been, the scrutiny over its performance, what it's doing for the bottom line of a dealership really wasn't there because it didn't need to be. It was, you know, the party was rocking.

That obviously has come to an end in the last six months. And so what we're now seeing is there is, rightly so, more scrutiny being applied to streaming and what it's doing for a dealership in a way that we have not seen really since COVID began because of all the dynamics of supply and, you know, everything else.

And so what I think is going to come is the, we'll call it the automotive community is going to start asking and is starting to ask tougher questions and really going to force our industry, streaming for the automotive industry, to really get serious, which I'd like to say we've already been, about demonstrating the value the space is having.

So those are kind of the two big things that we haven't seen and that will, I think, continue to progress into the future.

Summer has always been a crucial season for car dealerships. The momentum generated by promotions and new inventory turns up the heat, but with the evolving market landscape, historical sales patterns are no longer accurate. After years of industry disruptions and fluctuating economic conditions, it's time to revamp your summer sales strategies.

In this insightful webinar, Suzanne Reimer, Chief Marketing Officer at Lotlinx, shares proven strategies to help you navigate the unique challenges of this summer. From managing new inventory growth and adapting to consumer preferences to dealing with inflation and high interest rates, this webinar provides you with the tools you need to succeed.

Key Takeaways from this Webinar

- Top Market Factors Impacting Summer Sales: Gain insights into the primary market factors that will influence your summer car sales. General managers and inventory managers will benefit from understanding these critical aspects to enhance their sales strategies.

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Proactive Inventory Management: Understand the importance of proactive inventory management using data intelligence. This takeaway is crucial for all attendees, especially those in inventory and marketing roles, to maintain a competitive edge in the market.

We sit down with John Traver, CEO of Traver Companies. John brings over 30 years of experience in the automotive industry to share actionable strategies that can help your dealership improve sales effectiveness and customer retention. Whether you're a dealership owner, manager, or sales professional, this episode is packed with valuable insights to drive your success.

Key Insights from this Episode:

• Effective Sales Techniques for Dealerships: Learn proven methods to enhance your sales processes and close more deals.
• Boosting Showroom Traffic: Discover innovative strategies to attract more customers to your showroom and keep them engaged.
• Enhancing Customer Retention: Understand the best practices for retaining customers and building long-term relationships.
• Innovative Approaches to Automotive Business Development: Explore new ideas and techniques to stay ahead in the competitive automotive market.

John Traver's expertise provides a comprehensive guide to tackling the common challenges faced by car dealerships. By implementing his strategies, you can transform your dealership's performance and achieve greater success. Don't miss out on these invaluable tips and insights!

Discover the top car inventory management strategies for 2024 in this insightful interview with Chris Wyndham of LeadVenture (https://www.leadventure.com/). Learn how to navigate high inventory costs and leverage digital tools to optimize your dealership's performance. We’ll cover key principles to enhance your digital storefront, improve customer engagement, and manage costs effectively.

Key Topics:

• Effective car inventory management tips
• Impact of interest rates on car sales
• Leveraging digital marketing for car dealerships
• Maximizing exposure with high-quality photos and videos
• Utilizing AI for SEO-friendly vehicle descriptions

Join us as we explore innovative tactics to thrive in today’s competitive market. Whether you're dealing with aged inventory or looking to improve your online presence, these strategies will help you stay ahead. Subscribe for more expert tips on car sales and dealership management!



In this episode of the DrivingSales Defining Leadership Podcast, host Bart Wilson sits down with Steve Roessler, Chief Evangelist Officer at DriveCentric, to explore the evolving landscape of leadership in automotive dealerships. Steve shares his expert insights on how effective dealership management strategies and innovative CRM solutions are transforming the automotive industry. 

Listeners will gain valuable knowledge on:

• The role of technology in enhancing dealership operations
• Best practices for human capital management
• How to implement successful CRM systems
• Leadership tips to drive team performance and customer satisfaction

Whether you're a department manager, owner, or general manager, this episode provides actionable advice to help you stay ahead in the competitive automotive market. Tune in to learn from one of the industry's leading voices!

Welcome to the future of automotive dealership management with our latest episode of the "Driving Sales Defining Leadership Podcast," titled "How to Create Sales Manager Scorecards". Join our expert hosts, Bart Wilson, Craig Wilson, and J.D. Mixon, as they explore the dynamic role of managerial scorecards in enhancing dealership operations and leadership quality. This episode delves into the critical question of creating scorecards for new or used car sales managers to drive performance.

It goes without saying that Generative AI has revolutionized the way businesses operate across various industries, and automotive is no exception. This groundbreaking technology is redefining the future of automotive dealerships by enhancing customer interactions, optimizing employee efficiency, and boosting overall profitability. Generative AI in Automotive is expanding daily so you don't want to get left behind. 

Derek Simonds of Numa breaks down where AI is today, where we're going, and how to stay out of trouble.

In the fast-paced world of automotive retail, achieving harmony between sales, service, and brand management is crucial for success. With Automotive Communication Solutions at its core, these experts are pioneering the path towards a streamlined operational model that elevates both customer satisfaction and dealership performance. Discover how a Unified Dealership Management process can transform your business, enhancing Dealership Operational Efficiency every step of the way.

Listen while Eric Glass and Jeff dePascale of CallRevu help us unify our dealerships:

In a recent conversation with Jasen Rice, CEO/Owner of Lotpop, he gave us an update on the current state of the used car market and how new car inventories and seasonality are going to impact used vehicles in the coming months.

How is the used car market?

Well, you know, the tax season, we're in that middle of that part where it's starting to pick up, it's gotten busy. I do think we're at the tail end of it.

We turned out shopper activity. We look at Google Trends, people looking for used cars, and activity, and we always see either a February or March peak in that shopper index, and then it starts dropping off. What we've noticed off of those trending metrics is that we've hit that tipping point, I think, and then it typically goes down about 20% on their metrics between now and the middle of April.

Once that happens, you know, the thing is dealers right now are really busy, so they don't feel it yet. The customers who are done shopping might be still acquiring the vehicles. That's going to happen between, you know, now and the next couple of weeks, and dealerships usually don't react until it gets painful.

It will take about another 30 minutes for the smoke to clear in the tax season, which will put us right about the middle of April, because you think about it, April 15th is the deadline, right? Anybody that's waiting until the last minute to file probably owes money. I know that's typically what I do. I'm not going to file right away and write a check. I'm going to delay that as soon as I can, so dealers will start feeling it by mid-April and rolling into May. But they're doing pretty strong right now.

Google Trends and the Shopper Index

Now, that's basically kind of the shopper index again, and when I look at Google Trends, they do it on a scale of 0 to 100. And so, and it depends on the timeframe you look.

If you look right now, let's say at the last year, the peak of that shopper index has probably hit over the last, about last week, so that would be at a hundred on the Google Shopper Trends. Then by mid-April, it'll drop down to about 80, so that's about the 20% drop. What we'll see is about a, anywhere from about a 10 to 18% drop in volume though with that.

So as the shopper count goes down, the volume will follow. Now, the Google Trends, this isn't like Google tracking, you know, shoppers. What I'm looking at in Google Trends, and if you go to google.com/trends, you can type in any word, fishing, and see if that's trending up or down because it's springtime. You could type in whatever, Taylor Swift and Travis Kelce, whatever.

But if you type in used cars, so basically how many people go into Google, typing in used cars, that's the trending metric that I'm looking at. And it goes verbatim with our dealer's two-week volume. We track dealers on used car inventory management. We want a dealer to sell a hundred percent of their inventory every month. What we look at is what's going on in the last two weeks, and then the goal would be to sell 50% of your inventory in a two-week window. And we track those metrics, right?

And so as the shopper count goes up seasonally, the two-week sales volume goes up. And then as the shop count goes down, the volume goes down with it. Again, we've hit the peak and usually, that volume follows about a week or two after. So as the shopper count goes up a week or two later, the dealer's volume goes up. As the shopper count starting to go down, we're in that second week right now, that's where we'll start seeing that volume go down.

Anywhere probably I could say 10 to 20%, but more accurately probably 12 to 18%, we'll see that volume start going down because right now they're selling well above their 50% sale rate. A lot of our dealers were hitting 62%, on average was a 62% sale rate. This means that if they had 100, on average, our dealers had 100 in stock, they're selling 124, 125 of that 100. We will see that drop about 12%, but also that's in about a two-week window. We'll see that 62 go down to 50, and then we'll see that 50 drop down to 43. That 43%, again, you times that by two, that means out of 100, now you're going to be selling 86. We'll start seeing that in about the next 30 days.

How strong is used car pricing?

That's what that people say, at least what I've seen in articles when people say strong is the average price.  The average price went from 38 grand to 42 grand, or the average price on used went from 18 grand to 22 grand.

Now does that mean it's strong? Now that's, yeah, it's a higher dollar car. So it's a higher-dollar car. Now strong meaning price to market, like, hey, where are my cars leaving the market?

Right now, I mean, I was just looking at a dealer that's priced at a little over 100% market or 103% of the market, meaning he's 3% above the average, and he's selling 65% in two weeks or 130% a month. He's able right now to ask for a premium, at least in his market, to ask for a premium and still keep the volume going.

That's all going to change here in the next couple of weeks. So it depends on what you mean is a premium. Is it because it's a higher dollar or can I ask for a higher percentage of market? And this is where a lot of dealerships, again, this 30 to 45-day window is where a lot of dealerships are going to miss the boat.

What I mean by that is they're having a strong February, and March. They're going to have to go replace this inventory, so when they go to the auction to replace the cars, they're willing to step up because they're short and they want to keep the momentum, and so we're going to have what I call a false positive. What I mean by that is it will be positive in the fact that wholesale values will still be strong, again, over the next three to four weeks, because as dealers are selling this volume, they're going to go to the auction, they're going to step up. That's a premium at the lane, so it makes it look like the market's still at a premium.

But as things start slowing down over the next two weeks, the volume is going to go down. They can't sell anymore. They're going to have a hard time selling at 100% of market in three weeks from now. They're going to have to start selling at 95, 98% of the market, meaning two to five percent below market to keep that inventory moving. They're going to go to the auction, and pay a premium over the next two weeks to keep the pipeline full.

The problem is in about two to three weeks, where they got to sell it and what they paid for it isn’t going to match. So the false positive is, it's a positive, looks like things are strong, but it's a false number because you're pretty much going to have to end up selling it for what you bought it for, and that window of time from mid-April to end of May, dealers are going to say, well, I'm not going to sell for that. I had to pay more than that. I'm not going to lose money on this car. It's going for this much at the auction. Well, it doesn't matter.

Customers are dictating the retail market and wholesale won't follow until about two to three weeks after retail starts dropping off. As retail starts dropping off in mid-April, wholesale will start dropping off in May and then it's going to be a catch-22. You have to have the inventory, but to sell it, the gross isn't going to be there. But that's why you always want to keep your inventory lean and clean and be a buyer at current market value, so when the market goes down because nobody's buying, you can be buying because you're not stuck in a bunch of aged cars. And again, this is the next 45 days, dealers are going to have to pay attention to this.

Will the market rebound in Q3 or Q4?

What happens is July and August, we see a little bit of an uptick in shopper activity. Again, a little bit of an uptick in volume, and then I'm talking used cars.

I think a lot of that happened, and I'm talking about tracking this for 10-plus years, we'll start seeing a little bit of a summer uptick. It falls around that July and August area.

I think a lot of that has to do, because I scratched my head at that, and some of its road trips and things like that, people are replenishing cars and stuff. But I think what happens is there's a lot of, and I know this is probably a more true statement now. Again, I have no way to validate this, but watching the shopper patterns, I'll show how I can defend this statement is, I think a lot of that uptick in used car activity.

Now it doesn't go back up to the 100, what I was talking about earlier in February, March, it might go up in the 70s, instead of being down to 40s and 50s shopper activities, it'll go up to about 60, we get a little bit of uptick.

And the reason why I think that happens is I think it's wrapped around the new car summer sales events, Toyota summer sales-athons, right? So there's a lot of good deals happening on new cars in the summer months, a lot of leasing and things like that, that attract people to shop for cars again? The reason why I say I can back that up is back in 2020, 2021, and a little bit of 2022, we didn't have new cars, and so there weren't a lot of summer sales-athons and that shopper index didn't spike back up from 50 to 60. It just kind of stayed the same and trailed down all the way to the end of the year.

If March is at 100 on a scale of zero to 100 on the shopper index, it's down in the 40s by December. So usually we get this March 100% shopper tax season, drops down to about 60s and 70s into going into the spring, and gets into the 50s and tips back up in the 60s or so in July, August, and then goes down all the way to about 40% going into December.

The reason why I bring that up is I don't know if we'll get the used car activity. I think it'll come because I think there's going to be a lot of attention on new cars come summer sales-athons and summer sales events. Inventories there for most manufacturers, Chrysler, Dodge, Jeep, Rams, and mostly Ford stores. The domestics have the inventory. Honda still struggles with it as a little bit there, but the domestics, and especially any Stellantis-type dealership, are already running pretty decent incentives.

I think by summer, the incentives are going to be even bigger. I almost think this year, if it's not springtime or summertime, it's going to be by the end of the year, you're probably going to see some of the biggest incentives ever because interest rates are still high and a lot of people have a lot of negative equity. So if these manufacturers want to continue to sell a lot of new cars, you're going to have to give special rates, which I think Chrysler has 0% or 1.9 for 72 months, but no rebate combination. By summer, I think you get the incentive and the rebate combination going on like, hey, 1.9 for 72 months and three grand rebates to get a lot of new car activity going. I do think that come summer, we're going to get a lot of new car activity, which then what happens is we're going to get a lot of trade-ins, which will continue to make use car values continue to drop. It peaked at like, the average price went from $18,000 to $22,000 average price for a used car, which just shot up.

I think that number is going to be back down to $16,000 after summertime for used cars because we're going to get a lot of trade-ins on new cars.

Now that's speculation. I know we're going to get a lot of new car activity with summer sales events, but I do think used car values are going to get really soft all the way to the next tax season after this window goes if new cars become really popular in the summer.

 How has the market remained this strong with the higher interest rates?

Really what's going to happen until rates get back below that 5% rate is it's the "need market" and not the "want market", hey, I want a new vehicle, no, I kind of need a new vehicle. And that's where I think the market stayed strong too because we got up to, I think over 12-year average for the car on the road. At some point in time, these cars are tapping out and they have to be replaced.

Mine wasn't, but I had an F-350 diesel dually that the warranty was up in six months and I had big old 36-inch tires and they're six tires and they're 500 a piece. It was like $3,000 worth of tires that I would have to replace something and okay, do I do that or get rid of it now while the tires are decent and get something new?

So anyways, I do think it's going to be more of a need up until instead of a want economy, and right now a lot of cars are aging out and they need to be replaced, so that's where it kind of keeps it strong.

I think people are open to refinancing in a year or two when the rates go down. But once they get below that 5%, I think it does open up the floodgates for more things to be sold.

New and used car pricing.

I think used cars are going to drop down to about the $16,000 range this year. I posted on Facebook a while back, probably three or four months ago, that there's a market trend where it showed the average used car went from 14 grand to 16 grand, and then at COVID it shot all the way up to 22,000 and it took about a year or two to do that. But then in less than a year, it's gone already back down to 20,000 and 18,000. And so just the normal trajectory would have put us around a $16,000 average used car price by 2025 or 2026 if COVID wouldn't have happened. We would have gone to 16 grand if COVID wouldn't have happened. COVID did happen, and it jumped up to 22 grand.

It's already down to 18 pretty quickly and I think we'll get to 16 before 2025, 26 because of, like I said earlier, I think people are going to gravitate toward new cars to get the better rate and to get a rebate to help them get out of a car they might've bought in the last two to three years, negative equity wise. Also, I think the deals are going to be good enough, again, going back to these cars being so old on the road.

I do think used cars will go down. I could be wrong, but it might stick around the 18 grand, I think a lot of cars are going to get traded in on new, they're going to be cheaper, 8 grand, 10 grand, 12 grand type cars that people have been holding on to.

I think that will help drive this down. New cars though, Chrysler I know, I think on Jeep they dropped the MSRP 4 grand. Look at what Elon Musk doing with Teslas and they dropped the prices on those, which forces, I think Ford did on their Lightning, dropped their prices.

I think these manufacturers are starting to drop MSRPs down a little bit more realistic. But the technology is there to kind of defend it. I keep looking, I look out the window of the truck I bought, it's got the lane assist and the almost automatic driving, the depth, I mean, I know a lot of cars have that, but the Apple CarPlays, the technology, the automatic headlights, and no emergency brake, I mean, there's just some technology that defends the extra cost on these cars. But I do think we're going to hit a wall with that for a little bit.

I definitely don't think manufacturers, especially like Stellantis are going to keep raising their prices when the inventory is sitting right now. If anything, they're cutting back, which they did on the Jeeps Cherokees, and they're doing the rebates and incentives. That's where I think the incentives get really big. I don't know if they really want to go in there and drop the MSRPs, that way they can a year or two from now keep that type of number, but I think they put these big rebates on them to help offset that added cost that probably not there anymore.

Because you think about it, they went up really quickly because of the part shortage, right? When they have to buy a part for extra money because of the shortage, they're going to have to add it to the MSRP. If the part shortage is no longer there, they can't defend that price range, so instead of dropping MSRP and losing credibility on that, I think they'd throw it in a rebate and make it look like the good guys trying to stir business up.

How does LotWalk help dealers with their used car inventory?

Well, again, so let's talk used cars and a lot of this, especially through COVID, you're going to apply it to new cars too. But I want them to sell their current rate. If they have 100 cars, let's sell 100 cars, okay? You don't need 100 cars to sell 70. If you got 100, let's sell 100.

So let's get the volume there, but increase the gross also, and how you do that is increase the amount of cars you sell fresh. You ask any dealer, when's the best time to make the most money on a car? Day one. If you increase the amount of cars you sell within that first 30 days, your gross will go up and sustain. Our goal is for them to do 60 to 70% of their sales in the first 30 days.

You do that, you're really maximizing gross, minimizing bleed through aging problems and costing your gross, and then your volume kicks in with that. When 70% of your sales are going out in less than 30 days, you're able to turn that inventory faster.

But the new approach also is lead management. One of the things, and the reason why we call it product LotWalk is you do a physical lot walk. You look for any issues on your lot, fill in holes, and dirty cars, but also you do a lot walk to make sure that any customers are out there being met and greeted on your physical lot. The virtual lot, you've never been able to do that before because you have a CRM over here that's run by an internet BDC department that this tool doesn't talk cars. I'll explain that in a minute. And then you have an inventory management tool over here that really doesn't talk customers.

So what we've done over the last year or two is put these two worlds together, and it really exposed to me, because I started doing internet sales in 1997, we've been doing it, not wrong, but we've been doing it the same for 25 years. We follow up with leads based on the age of lead. When we get a fresh lead, we're calling it and emailing it every day, every other day, because it's a fresh lead. and that 30, 40-day lead, we're lucky if they're still following up with them, or maybe it's every other week by then.

What I realized is when we get a lead, we don't know when the customer is two days out or two months out. So managing it based on the age of the lead could be irrelevant to where the customer is in their buying cycle. They're either doing something quickly or starting their research. But I don't know until I get a hold of them. so it's really not an effective way to follow up with leads.

The other area that we're looking at is inventory issues to keep that inventory turning, right? Well, you've got to figure out if I'm not selling 100, carrying 100, selling 100, and not doing 60 or 70 in the first 30 days, I got to figure out why. What's slowing me down? It could be something like your heavy and large pickup trucks.

Our example is, let's say you have 30 in stock and you've only sold, I don't know, 10 of them in the last two weeks. Well, if you sold 10 in two weeks if you times that by two, you're only on pace to sell 20 in a month, but you have 30 in stock. So if you want to turn your inventory every month and you have 30 in stock, but only on pace to sell 20, you're 10 units heavy in large pickup trucks, right? So that could be why you're slowing down. Okay, well, let's isolate large pickup trucks in our inventory.

But here's the next question I would ask a dealer. If you have a truck problem and you happen to have any leads on your trucks, how often would you want to call and email these leads to get your truck sale rate up so you're not just dropping a bunch of prices? And guess what they'll say? I'd want to call them every day, every other day.

And this is the point is, the reason why I said earlier, CRMs doesn't talk cars. You can't go into a CRM and say, give me my truck leads. Much less you can't go into a CRM and say, give me my truck leads where the car's still in inventory and it hasn't been sold from that underneath that customer. Or give me my truck leads that the car's still in stock and I haven't contacted in the last two days.

Because again, if I have a truck problem, I would want to call and email these leads every day, every other day. I don't care if it's a 50-day-old lead or a two-day-old lead. I need to get my trucks going, so let's call and email my truck leads. But again, in the CRM, you can't do it.

Our lot walk tools allowed us to do that now. And we could say, hey, you got a truck problem. Let's isolate the trucks before we make adjustments. Let's go look at our leads. Let's increase our contact ratios over here. And now we can actually attack leads based on situations on my lot and not just based on the age of the lead.

To me, that's a huge concept that we never really had in the industry when it came to inventory management or lead management, these two worlds should be running side by side.

 These two departments should be run by one person or at least share the same office and come up with a game plan every day and say, here's where inventory is struggling. Here's where I need you to focus on the activity with your leads today.

The impact of inventory on Internet leads.

We're recycling the leads. We're marketing, getting all these leads, and what we found was there were three numbers that I thought were important that we found.

The first one is like 60% to 70% of your current active leads, if you look at zero to 60-day old leads, 60 days' worth of leads, 60% to 70% of them are on cars that are no longer in stock. They can't buy the car that they inquired about because the car is sold. So that was one number.

The second number was half of your current leads on the car still in stock, half of those leads are on just 10% of your inventory, so if you have a hundred cars, okay, half your leads are just on 10 cars. I like to tell a dealer, think of a lead as an activity. I get a lead, I'm going to do a call or an email and an activity. So if my team did a hundred calls and emails today, okay, half of those calls and emails, because half my leads are on just, it's just going to impact 10 of my hundred vehicles. Think of that.

The third number was half your cars have no leads. If I have a hundred cars, 50 of them don't even have leads at all. This is where the eye gets, this is really where I open my eyes and go, huh, that means half of my cars get no activity at all. What am I doing about those? And that goes back into marketing dollars. Do I, do I go spend money and advertise this car? Do I drop the price and cost me money or the 60% over here that was on cars and no longer in stock? What if I recycle them?

That customer who wanted that F-150 at $40,000, but it sold last week, it's a 30-day-old lead. Do I just get off of them because it's a 30-day-old lead and the car he wanted, it's no longer in stock? Or where most people, 60, 70% end up buying a different car than they acquired in the first place, right? So why don't we take that 30-day-old lead and say, Mr. Rice, I know that the F-150 you're interested in has sold, but are you open to other large pickup trucks around 40 grand? Because if you are, I got a Ram 1500, I got a Silverado, I got another F-150, right? Offer them a switch opportunity because we would do it on the showroom floor.

So why don't we take the customers over here, the 60% that can't buy the car there anymore, and see if there's a match on my inventory, especially the 50% that don't have leads? Hey, I don't have a lead on this Focus, but I got five people looking for a compact car around 18 grand. Let's call and email them before I just go drop my price.

That’s where I say, inventory management should be lead management and lead management should be inventory management. These two departments have to go hand in hand to maximize those dollars.

Explore the forefront of automotive purchasing with "Indulge in the Future of Car Buying" — a captivating interview with Matt Chinn of Gubagoo, presented by DrivingSales. Dive deep into the transformative digital retailing solutions that are reshaping how dealerships interact with customers online and in-store. In this insightful conversation, discover how Gubagoo is leading the charge in integrating digital tools for a seamless car buying and selling experience, especially in the evolving landscape post-COVID.

What is the current dealership climate on digital retailing?

COVID sped everything up, kind of forecasted the direction that Gubagoo among many companies that offered digital retailing thought we were going anyway. Coming out of that we've seen a slower adoption. I think people are eager to do what they haven't been able to do and that is get into a store and test drive vehicle, kick the tires, so to speak.

There has been kind of a lull, but just taking the opportunity to take advantage of the entire car shopping experience. But for us, where that really comes in is kind of move in the direction of maybe the the need or desire that we thought was going to be there to buy a car exclusively online, that was required out of necessity from COVID, has been reduced a little bit and now the the real demand is for that blended buying experience so that online and in store to match and to be seamless. I think that's really the need for digital retailing is most important. 

The definition of digital retailing differs from customer to customer.

That's what we see it as moving more in that direction. I think you nailed it. I think the previous notion, especially from dealers, was that the customers are gonna want to buy A to Z online, and that might not be the case now. We had to go through the experience like we just talked about, but the the demand is still there that you need to be able to offer some sort of shopping experience online, even if it's not fully a buying experience online.

And it's really important so that all the work the consumer's done, when they show up, it matches 1 to 1. And it like I said, it just builds that blended experience and the numbers and the interactions that they have online matter. It's not just smokescreens of what you want them to think they're seeing., it actually is like that.

Where do you find dealers struggle with digital retailing consistency?

 Some of it is just capabilities, working with tools that don't speak well to each other. Maybe they have a website that comes with a digital retailing experience, but has no interactions or talking to their DMS or CRM. So in the inventory that they're looking for online maybe isn't updating as quickly. The numbers that they're seeing online aren't backed by actual lenders or the desking tool would desk a deal that's not going to match at all. I think for us, it's really just using such disjointed tools. 

You've got dealers who say, Yeah, I have a digital retailing tool, that's what customers demand, but then when they go instore or they try to back up and try to do the car buying process, as if they didn't do any of that work themselves. Those are the things that immediately fracture trust and hurt the consumer experience.

Lack of consistency is frustrating to the customer.

I think it's a kind of akin to the existence of DoorDash and Ubereats. If you're going online and you're like, "it makes it so simple, here's all the information, here's all the stuff I want", and I place the order and what shows up isn't what I ordered. I don't know if I'm calling DoorDash or I'm calling the restaurant. The restaurant doesn't have any record. They say that's DoorDash's fault. That's not my fault. And if that happens to the car process, you get there, these numbers that you talked about are fractured. It's going to lead to that same experience.

I hate to say it, but there are restaurants I don't frequent anymore because the online to physical interaction just didn't match and there wasn't any support or trust in those tools that I had. 

What are top dealers doing right?

I think you find this with any software application. It's the commitment to the tool that you're paying for and training and dedication from the staff. We have a chat platform that is all hands off if you want it to be, but where you really see the improvement is where they have the dedication of the staff and have people that are bought into the tool as well and are handling those conversations, moving people through the digital retailing process, moving them from a conversation, just a chat question out of the blue about inventory to okay, here's how you explore your payments, execute a credit app and things like that. 

I think when you have that commitment end to end it, you can really feel it. Whenever a customer arrives in store, they understand what you were talking about. We can pick up right on our iPad. We can jump right in. I think that and commitment to the applications and the software that you're purchasing, that's going to drive the difference. 

How does Gubagoo approach support?

There's onboard training. We want to make sure that people are in the store training people how to use these products.

I think the big differentiator for us is our client success team. You have someone you know tied to your account immediately right off the bat that is there to support you, is there to show you the different things you do to leverage and implement in the store, train you up on things and give you like real honest, conversational reporting when these things are happening to show how either your salesforce or your team is using the tools.

What is the best digital retailing structure?

I think the scale of dealerships you work with varies wildly, so I'm not going to say anything is like a one size fits all approach. I think anytime you are working within silos, that just creates the opportunity for communication breaks and gaps. I prefer if there's the opportunity to eliminate those silos that have everybody on the floor understand, whether your BDC, or maybe you have a chat team, or maybe it's just one Internet manager that's trying to facilitate all this, the people on the floor are aware of what's happening on the Internet side whether they're working those leads themselves or not. As long as the communication is consistent that if someone arrives into the store, everybody on that floor can understand how they may or may not have interacted with on your website.

I feel like that's a big miss a lot of times that your sales folks don't even understand what's possible on their website. They haven't got anything for themselves. They haven't gone through that digital retailing experience to see what a customer is going to see before they arrive at the dealership. I think going through that process one time and level setting for all the salespeople, they'll have a better understanding of what the expectation will be when the actual customer arrives.

So regardless of who's working the leads in the back end, I think that consistent communication and level setting is what's really going to drive success and make for a better customer experience when they arrive on a lot. 

What are some chat trends you are seeing?

I don't have the stats in front of me, I probably should, but a lot of these chats that we're handling and we manage, that we train our chat specialists to handle as well as the AI within the tool, is to handle these like concierge chats.

When I think of the fixed ops side, I think of that a lot. Our goal with sales is that we want to gather PII, we want to make these are actionable leads. We want to work them into digital retailing so that you're working a deal when you get that information not just chase down lead information. 

On the fixed side, it's a little more interesting because there's not that 1 to 1 as much. But if as we say, if our websites are truly extension of the showroom and extension of the dealership, when someone hops on, when they are chatting, they expect it to be someone in the dealership. That's where we use AI and our chat specialists really step up and if you want hours we know what they are and we respond immediately.

We have integrations that allow you to schedule your service appointment directly within the chat and have that turned around immediately. A lot of those concierge chats are the ones that really step up, and that's a huge bulk of what people expect when they land on a website. They interact with somebody and it's surprising how often those fall flat or require follow up when consumers today demand that 1 to 1 immediate answer. I feel like that's probably the biggest role that we play on a fixed side. 

What is your philosophy on AI in chat?

We believe our model is very much like Goldilocks terms. If you want to have the AI there to answer easy, simple questions that people want immediately and you want to be able to turn that around just to make sure that interaction was good and they got what they needed quickly and then our chat specialists are trained to jump in when those conversations get more complicated. Where does it make sense to start with PII, let's get this person working, here's a vehicle or two that they should be shopping and then they know to when to notify the dealership of when there's what we call like rescue opportunities for them to jump into chat themselves.

So we really believe in like that balance between artificial for immediacy, which people demand today and the human touch to make sure that they are getting where they need to go and we are supplying the best possible help lead to deal information to the dealership.

Redesigning chat interfaces.

 We've got this one example that seems so subtle, but it was pretty impactful for the dealers. Coming out of NADA a couple of months ago, we had a simple like an option for the dealer to have a redesigned chat interface. It's not the bubble that pops up, that just screens at you right when you're on the website, but it's one that's a little bit more subtle that people can react with. We're listening to dealers, giving them the tools that they're hearing from people that they want on their website and allowing them to customize these interfaces to be what they want.

Because every website is going to be different in terms of how much real estate they want covered by a chat agent, for example. So we listen, we react, we create different interfaces that they can choose from. But we also do want to be present and be there, so when people have questions, they know to come to us and have the answers immediately, that they will get their answers immediately. 

Consumers are more and more getting comfortable interacting with these chat agents, and they have a higher expectancy of getting the right answer. I remember when these things first popped out, it was so kind of like a it was a coin flip whether or not this was going to be a go, or do you just kind of like trained your brain to ignore it? But now more and more on it is like customer service. People are willing to engage the chat agents and actually get answers as opposed to here, we'll call you with answers.

That's what we train our chat specialists to do. 

How comfortable are consumers chatting with AI?

Candidly, the way that people are more and more comfortable, like interacting with your expectations, they are people who don't care. I think there's an expectation when you interact with somebody first on the website, you kind of expect this is the person that's going to facilitate, get my conversation to the right to the right person. So that's where AI comes in and answers all those like immediate question that is like that. You just want answers immediately. No person needs to hop on an answer that we know you're hours. You set those yourself, all that good stuff, and then a person can come in and take over and kind of pick up right where I left off. It's a very seamless interaction. But they're getting our chat specialist chat specifically for these chat conversations. And then when someone from the dealership comes out, we make it very clear like this is someone that's physically at the dealership, they're the person you're going to talk to you when you get there.

For the most part, when people hop on and handle chat, they're not concerned that they are talking with AI, what they're concerned about is the quality and the answer that they get. And that's where we try to put our focus. 

What does the future look like for Gubagoo?

For Gubagoo specifically, our focus has always been trying to create the best consumer experience and dealerships and providing their customers. What we've found is that people want immediacy. They want answers now. Down the line our focus is kind of going to be kind of like a CRM, and create a platform that allows for that immediacy, that messaging, and it gives dealers the opportunity to know where their prospect is online, and be able to reach out and engage in any step of their car-buying journey. Blending it so that you don't have your chat, the digital retailing, that goes from your digital retailing tool a prospecting that might not have any information on it. 

Our goal is to combine that all into one to make for that optimal consumer experience. It's just another opportunity for that disjointed experience that we talked about for online store. If you've got prospecting tools like CRM that aren't talking, that don't have any idea of what chat conversations you had or how far along they got in their digital retailing experience, where they're shopping for their own vehicle, where do they abandoned, then you're creating another disjointed experience where they're going to go jump on some prospecting schedule for internet leads. It's just going to seem like they don't know I that already picked my vehicle, that I'm just waiting on this credit application. Our goal is to create that kind of CRM that pulls that all together and create for that even more optimal consumer experience.

That's on the horizon out a ways. But I know that that's the kind of direction Gubagoo is thinking and wanting to go, essentially make sure that all those consumer interactions are together. 

A digital retailing customer is not a lead.

We really try to differentiate ourselves from a lead provider because this is all part of the consumer journey, really just maximizing and capitalizing on their intent and giving the dealerships the tools. 

If you're getting something from your digital retailing tool it shouldn't be seen as a lead, in my opinion. That's a partially worked deal. It's just picking up where you left off. It's engaging the customer, getting to the dealership, just finalizing some steps. That's my view of digital retailing, and we want to create a tool that is it providing lead information so a dealer doesn't have to chase down and see if this is a real email address or a real phone number.

We're creating a conversational experience with the customer that is working them down the funnel of this digital retailing experience where by the time they get to the dealership, they should know obviously all the PII information that normally lead would have. But we know it's good because they have shopping intent on the website, what vehicles they are interested in, what payments they want, maybe their exact credit score if they run the credit application. We know what their trade-in is. We know what lender and loan payment they picked. They're coming to you with that partially created deal. I view it all as a consumer experience and the digital retailing tool should signal some really strong intent for dealerships and it should equip them to be able to pick up right where that consumer left off.

And I think the CRM is the next iteration of that because we're just trying to identify every gap in that car buying journey and try to fill it with a tool that we think can talk to your other tools and create that better consumer experience.