Let’s talk about friction.

Friction doesn’t just play a critical role in physics. Removing friction from the automotive shopper’s journey is the key to automotive dealerships prospering in an industry fraught with challenge of running a modern dealership. 

Twenty years ago, an automotive retailer needed to be proficient with one-to-three traditional media outlets to promote its value while investing the majority of its time on hiring, training, developing people and honing and executing on processes to win with the consumer. Digital introduced some interesting wrinkles – on the one hand delivering more informed and purchase-ready consumers but also complicating the dealership’s life. The challenge of managing myriad digital advertising platforms and software alone actually began to compete with a dealership’s ability to develop its people. As a result, while the consumer is more empowered than ever, the dealership team members have struggled to master the very tools designed to empower dealerships. 

It’s time for third-party marketplaces -- dealerships’ vital digital advertising partners -- to step up and simplify the dealership’s job in the most important way we know how: removing friction from the shopping journey. Making the journey faster and less complicated will help dealerships balance supply and demand more effectively, whether the dealership is creating a sense of urgency around used-car pricing or guiding the shopper more intelligently through new vehicles.

But not all marketplaces remove friction the same way, and some are better than others. So, I propose a friction test to help dealerships better understand who really removes friction and thus connects more high-value shoppers to the lot faster.

The Amazon Example

First, some context: removing friction from shopping is the foundation of success for marketplaces such as Amazon that are shaping entire industries. Amazon enables consumers unfettered access to products, price details, consumer-generated reviews, information on similar products, and ease of transaction. For example, the Amazon Dash button provides an easy way for consumers to replenish staple goods such as detergent with a simple button. Amazon GO, the emerging brick-and-mortar grocery store, makes it possible for shoppers to literally take what they want from the store shelves and walk out the door without seeing a cashier or even a self-service kiosk. As Fortune magazine put it, Jeff Bezos is waging a war with friction, and he’s winning. No wonder Amazon is on track to become the first $1 trillion company by 2022.

Third-party automotive marketplaces may not have the scale and reach of Amazon, but they’re connecting in-market shoppers to dealerships similar to how Amazon connects shoppers with merchants. Marketplaces all remove friction differently, though. Dealerships can better distinguish these differences by applying a basic “friction test” in three different categories as follows.

Price Contextualization

Friction test: review how your car inventory is contextualized on the marketplace you use.  

The key question dealerships should ask is this: does your digital marketplace contextualize car prices to reduce friction between the auto retailer and the consumer?

It’s not enough for a marketplace to provide a standard price rating. A marketplace needs to provide the “why” behind a price, calling out a vehicle’s attributes that may be affecting the price and weighing additional factors such as the vagaries of supply and demand. Doing so enables dealers to be more transparent with their customers, show value beyond price and, ultimately, close the deal quickly and efficiently.

It is important to challenge your automotive marketplace on factors that contribute to the “price badge.”  If the marketplace is only using price without incorporating considerations such as supply and demand and the availability of sub-trim levels like options and packages then they are greatly adding friction by not neglecting to tell the complete “why” story behind the price.    

Additionally, does your marketplace treat its price ratings dynamically – or does your marketplace apply a one-size-fits-all formula to distribute vehicles into different pricing categories (e.g. “Good Price” or “Great Price”)? For example, when a shopper compares prices on a group of Ram 1500s -- some limited edition and some not – the marketplace should not apply the same rules for assigning different price badges as when a consumer compares a group of base trim Toyota Camrys. The number of vehicles that fall into Great or Good ratings should be influenced by dynamic metrics that respond to each unique consumer browsing scenario. If your marketplace is simply bucketing a set percentage of inventory into the “Good” price rating and set percentage into the “Great” price rating for every browsing scenario, then the marketplace is adding friction. 

At Cars.com, we provide price badges to remove friction in the car buying process. Our badging uses machine learning to assess the closest comparable vehicle and considers features that are either in high demand for a region or those that affect the price beyond year, make, model, and trim. If there are 25 2013 BMW M3s in a certain area and all are either “Great” or “Good” deals based on the data, then we take pride in conveying to the consumer this data and do not force a subset of these vehicles differently. 

Creating Connections 

Friction test: How well does your marketplace connect dealerships with customers 24/7?

In a business that depends on one person selling a car to another, marketplaces should connect a dealership with customers on the consumers’ terms. Doing so delivers more qualified, ready-to-buy shoppers on the dealership’s lot. 

For example, at Cars.com, we offer a tool known as Salesperson Connect, which helps shoppers identify a dealership’s salespeople ahead of time and build a relationship with them before the shopper walks on the lot. Salesperson Connect integrates into a VDP the top-rated salespeople based on their reviews (published on a review platform operated by DealerRater, a Cars.com brand) and thus gives shoppers one easy place to review details about the vehicle and the person selling it. Doing so removes friction by streamlining the process for consumers and connecting them to the right dealership and right salesperson to meet their needs. The dealership benefits by having its salespeople connected with a stronger lead. 

Salesperson Connect meets a fundamental shopper need: according to our own research, 97 percent of auto shoppers would like to select their salesperson ahead of time.[i]In addition, In according to a recent survey of DealerRater Certified salespeople, more than 80 percent of DealerRater Certified salespeople said their employee profile helps them sell more cars, drive more showroom visits per month, and speed up the sales process resulting in a higher close rate.[ii]

Making salesperson profiles available to shoppers also humanizes a dealership’s brand. And humanizing a brand builds trust, which leads to a buyer becoming more confident and ready on the lot.

Predictive Selling Indicators

Friction test: review how you and your marketplace uses predictive selling indicators to create a sense of urgency. 

Predictive selling indicators are common in digital marketplaces. Consumers demand real-time and predictive insights on how quickly an item may move, whether they’re shopping on a real-estate marketplace, an airline site, or Amazon. The retail housing marketplaces do a solid job of predicting when a house will sell, which removes friction between the buyer and seller because now both buyer and seller use the same data in deciding price. 

Automotive marketplaces should provide predictive selling, too, and Cars.com does exactly that. By analyzing vehicle supply, demand, and pricing data in a specific market, Cars.com now offers consumers the insight needed and dealers the third-party validation to ensure both parties win in an era of information parity.  For example, our “Hot Car” technology helps car buyers determine when and how to act on a purchase -- and assists in accelerating sales for both new and used cars.

The new technology leverages a proprietary machine learning algorithm from Cars.com to identify which vehicles are most likely to sell quickly, based on car make and model, geographic demand, time on lot, pricing and consumer shopping behaviors. Importantly, Hot Cars discerns between differences in purchasing windows for both new and used cars. For instance, a Hot Car badge is featured on used vehicle listings that have a 70 percent chance of being sold within seven days from the day it was added or modified on Cars.com. New vehicles earn a Hot Car badge when they have a 70 percent chance of being sold within 20 days from the day it was added or modified on the site.

This innovation creates a sense of urgency for consumers, which also benefits local retailers by increasing turn rate and speeding the time to complete the transaction.

Removing friction improves trust and speed to sale while engendering the most powerful sentiment in sales where both the buyers and sellers feel that they have won.   

Improving the On-the-Lot Experience 

Friction test: how well does your marketplace facilitate the purchase process on the lot?

Lot traffic still defines a retailers’ success.  The typical car shopper visits fewer than two auto dealerships before making a purchase versus five visits in the early 2000s.[iii]  And while they are on the lot, consumers are showrooming, or using their mobile phones to compare dealerships and their inventory. 

Dealerships should demand from their providers information on what consumers are shopping for and how they are cross-shopping while on the lot. For example, Cars.com provides a monthly report that provides dealerships insight into cross-shopping behaviors of mobile shoppers while they are on the lot. In addition, to remove friction, marketplaces should help shoppers make better decisions while they are on the dealership’s lot. 

We are on a journey as we strive to remove friction and connect in-market shoppers with sellers. Removing friction saves retailers’ and consumers’ time and money and importantly, improves the quality of the transaction.  How we remove friction will change (and often) as we use technologies such as artificial intelligence and machine learning to make our site adapt to shoppers based on their evolving preferences. Expect Cars.com to provide a more personalized experience that will result in more confident buyers coming to the lot. Stay tuned. Our friction free journey is just beginning.

Why are you paying Google to drive traffic to your site?

The automotive industry wastes billions on paid search, social, and re-targeting to drive consumers to their own websites – and consumer behavior data suggests that people are increasingly avoiding these sites. The auto industry needs to resist the seductive lure of spending billions to drive consumers to their websites. Instead, they need to focus on where consumers spend their time and invest there while appreciating the conumers’ growing desire to invest their times in comprehensive online market places.

A Disparity Between Spend and Results

In 2017, digital automotive ad spend alone will hit nearly $10.7 billion -- with 45 percent, or about $4.8 billion, being sunk in paid search, and 48.7 percent, or about $5.2 billion, going to display.[1] It’s fair to assume that automotive OEMs, local dealers, and their agencies will spend more than $10 billion to drive consumers to their first-party websites. 

The auto industry is wasting a ton of money on advertising – actually, 10,000 tons. Here’s one big reason why: while agencies spend billions to drive consumers to their websites, traffic to these sites is decreasing as first-party sites do not meet the customer’s expectations.  For instance, according to comScore data, from May 2016 to May 2017, traffic to automotive manufacturer sites alone decreased by a whopping 28 percent. [2] In addition, comScore data indicates that:

• Traffic to multiple national dealers’ sites over a similar period decreased by an average of 15 percent.[3]
• Third-party automotive resource sites (marketplaces) such as Cars.com averaged 2.4 times the unique monthly visitors as automotive manufacturer sites.[4]

The $10 billion wasted to promote first-party website traffic looks even more grim when you realize that shoppers don’t spend much time on dealership and automotive sites, either. In fact, they spend 60 percent of their time on third-party sites and only 25 percent of their time on dealership/OEM sites combined.[5]  

To make matters even worse, advertisers risk spending their money on bogus sites or sites that will hurt their brand. As recently reported, Google is refunding businesses whose advertising dollars were spent on websites with fake traffic. In all, advertisers lose $6.5 billion to fraud, and tracking the value of their legitimate spend is complicated by a system that fails to be transparent.[6] The 10,000-ton Google elephant in the room is the $10 billion that automotive industry is wasting to drive traffic to first-party websites. And the industry needs to talk about the elephant or else continue wasting money. With a flat-to-down seasonally adjusted annual rate in 2017[7], OEMs and local dealers need to be hyper-vigilant about the effectiveness of their marketing or risk losing share to more advanced/aligned OEMs and local retailers. 

Why do automotive shoppers prefer third-party reference sites over first-party automotive sites? Well, two reasons stand out: 

Rising Consumer Digital Expectations

Consumers’ expectations of automotive sites are being influenced by their experiences on comprehensive marketplaces sites such as Amazon, Zillow, and Expedia. On these and many other market place sites, consumers have become accustomed to and demand:

• Speed.
• Trustworthiness.
• A wide selection of easily searchable inventory.
• Expert reviews as well as user-generated content.
• A mobile-first experience.
• An experience free from ad disruption – either free of ads completely or free of ads (such as pop-up ads) that get in the way of finding what consumers want to find.

Consumers continue to interact with non-automotive sites even as they research for an automotive purchase. All the sites they visit shape their expectations of their digital experience with automotive sites.    

Automotive Sites Come Up Short

Most dealerships and OEM sites still struggle to provide a complete, easy-to-navigate vehicle selection and an independent as well as crowdsourced reviews of the price, vehicle, dealership and sales staff. According to a DrivingSales white paper, Competing on Consumer Experience, “. . . consumers use online sources they consider to be the most trustworthy and objective. Three out of four shoppers reported using third-party car buying websites while shopping for their new car while substantially fewer used dealership websites.” The white paper cited these reasons for why consumers avoid dealership sites:

• “They find them confusing and cluttered 

• They don’t want to be ‘bugged’ if they submit a question or inquiry 

• They feel information on 3rd party sites are more ‘trustworthy’ and complete” 


Being mobile-friendly is another trait that consumers have come to expect. According to Google, the average load time for mobile landing pages in general is 22 seconds – yet 53 percent of visitors abandon mobile sites that take more than 3 seconds to load[8]. Chances are your site is not fast enough for the mobile consumers. (At Cars.com, 59 percent of our traffic comes from mobile and we can help you reach those consumers no matter what device they’re using.) You should consider the mobile experience of your site before spending advertising dollars to drive consumers to your first-party site.

The real beneficiaries for the promotion of first-party traffic have been Google, Facebook, and their reseller agencies that promote such traffic.  For instance, Google recorded $25.7  billion in revenue for Q2 2017, and Facebook beat expectations for its most recent earnings report. Advertising fuels earnings for both companies. In Google’s case, advertising accounts for 87 percent of the company’s revenue, thanks partly to automotive dealers and OEMs pumping money to drive people to first-party websites that do not meet the consumer’s digital expectations.

How to Address the 10,000-Ton Elephant

To address the 10,000-ton elephant in the room, OEMs, dealers, and their agencies need to meet consumers where they are in their journey (rather than try to pull them to automotive websites) and understand what influences consumer’s decisions. I recently discussed in a blog post how the automotive industry needs to operate by a redefined four Ps of automotive marketing: product, price, place, and person. As I discussed, consumers have redefined place to mean not only the lot, but also all the digital destinations where they interact with your brand as they research their purchase.

We know from our own experience and data that the consumer’s purchase journey is varied and layered. Those research touchpoints include social media, reviews, OEM sites, industry trades, and third-party publishers such as Cars.com. Leading automotive OEMs and local auto retailers understand the perils of spending too much money and energy on driving traffic to first-party websites. Instead, they are trying to best promote their people, dealership, product, and vehicle price, on third- party marketplaces to get them to walk into the dealership. 

Finally, it is critical to understand and appreciate the differences in goals that your OEM or local auto retailer have against the car shoppers’ goals. As the DrivingSales white paper discusses, car shoppers want independent validation; a large, unbiased selection of inventory; and trust and transparency.

Understanding the 4 Ps and differences in your goals versus the consumer’s goals is key to addressing the 10,000-ton pound elephant in the room.

Automotive dealers and OEMs are obsessed with widely inaccurate CRM metrics that focus on traditional email and phone leads. There is a growing movement from leading OEMs and dealers to focus on what drives outcomes – the sales of new, used, and CPO vehicles and services. As consumers use a few key sources to decide what, where, and from whom to buy, it is critical for dealers to advance beyond single source CRM email and phone leads – or be left behind by OEMs and advertisers who are rapidly evolving with consumers. 

Cars.com recently surveyed hundreds of recent and prospective car buyers to understand how they interact with dealers throughout the purchase journey.[1] We carefully screened these shoppers from a large national research panel to ensure that we were getting responses from in-market shoppers. We found that quality leads – people who are serious about making a purchase – fall into three buckets:

• Phone. About 22 percent of shoppers call the dealership to set up an appointment.
• Internet. About 28 percent use their mobile phones or desktops to contact dealers online – through email, text, a lead form, or some other digital contact.
• Walk-in. A whopping 50 percent do not contact the dealer or submit a lead before visiting a dealership. Instead, they research on their own and then go directly to the lot.

To convert quality leads to sales (outcomes), dealers need to tailor their approach to identifying, nurturing, and closing leads for each channel. It is critically important they optimize their approach for the largest of these buckets – walk-in traffic. 

According to research we completed in June, 52 percent of walk-in shoppers purchase a car within one day of their visit, and 67 percent buy a car within 72 hours.[2] To succeed with walk-in shoppers, dealers should train sales staff to understand how a consumer’s motivations and behaviors may vary depending on where they are in the shopping journey.

While our research indicates that consumers visit less than 2 dealerships before purchasing a new, used, or CPO vehicle, we’ve also uncovered three different categories of walk-in traffic:

Early shopper: Early in their car search, walk-in shoppers are more likely to visit a dealership to experience vehicles firsthand. They will often show up without a specific model in mind – just to learn about car features and attributes that will be important in their search. An exploratory visit may help them to begin the process of narrowing possible options.

Mid Funnel: Later in the car search, walk-in shoppers will visit a dealership with the goal of finding a specific make and model, test driving it, and vetting it as a possible option. The goal is to ensure that a car is the right one for their specific needs.

Low Funnel: Near the end of the car shopping process, walk-in shoppers go to the dealership with a purchase in mind. They begin to feel out the dealership on their real price and start the negotiation and purchase processes. Their goal is to get the right car at the best possible price.

It is critical that local automotive sales people appreciate that walk-in shoppers are heavy online researchers. Best practices include having the local retailer acknowledge how digital research drives walk-in traffic and asking the consumer which sites they visited. Just as your best automotive sales people know the features of their product and how it stacks against the competition, successful sales people also appreciate and know the differences between core third-party sites and OEM sites. They know that connecting and speaking to the consumer wherever they are looking is critical to driving greater retail outcomes (sales). 

As mentioned previously, 50 percent of car buyers are walk-in visitors that have not submitted traditional leads before they visit a dealership. Walk-in shoppers are arriving on dealers’ lots confident that they don’t need to engage with a dealer ahead of time. They don’t hesitate to use their mobile phones to research your competitors before and during a visit to your lot. In fact, 64 percent of walk-in shoppers use smart phones to compare vehicle prices, 41 percent use their devices to read reviews, and about half to compare vehicle makes and models.[3]

In assessing the ROI of your advertising mediums, challenge your advertiser to review how much walk-in traffic they influence.  For more insight into quality leads, check out the newly published The Cars.com Guide to Converting Leads to Sales in the Digital Era.