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Lindsey Auguste and Dennis Galbraith

Lindsey Auguste and Dennis Galbraith Investigative Reporters

Exclusive Blog Posts

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BDC training for 2017

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Comparing AutoTrader.com and Cars.com


Comparing AutoTrader.com and Cars.com

Our conclusion to the years old AutoTrader.com and Cars.com comparison debate boils down to one simple word, "don't." We've seen and heard lots of these debates over the year. What follows is our take on why the most commonly used comparisons just don't hold up, as well as our recommended approach to dealers.

Relative Number of Site Visitors

When you buy AutoTrader.com or Cars.com you are not buying access to the audience on those websites. You are buying access to the vast audience across those networks of websites. For many years, these companies have been posting the millions of vehicles listed on their websites on other sites as well. Some of these sites are regional, so this added benefit is not evenly distributed geographically. Of course, the popularity of the core sites varies geographically as well. If you are selling vehicles nationally or across a huge region, like Finish Line Ford or Suzuki of Wichita, then total audience size matters. But for most dealers, what matters is the relative audience in the dealer's market. Getting good metrics on visitation that are consistently defined for both services across your market is difficult to impossible. Some markets are relatively strong for one service vs. another. Cars.com is very strong in Boston and Chicago, but that is not the case in San Antonio. Does that mean Cars.com is worth half as much as AutoTrader.com in San Antonio? One-third? One-fourth? We don't think it is possible to gauge the comparative value based on audience alone. Smaller audiences tend to attract a smaller number of competing dealers.

Experience of Trainers and Other Vendors

We've heard trainers and vendors try to weigh in on this discussion, because they can bring larger sample sizes to the debate than most dealers can. However, the degree to which those samples of dealership results on Cars.com and AutoTrader.com are representative of your brand in your market is almost nil. Even if a vendor had results from 100 stores in the same market, the results vary greatly from store to store based on product, price, and merchandising. AutoTrader.com was always better than Cars.com at attracting Pickup Truck buyers, so Cars.com bought Pickuptrucks.com and put their truck inventory on that site as well. Has that closed the gap? Is Cars.com as good for Dodge dealers in your market as it is for Lexus dealers? Are Cars.com and AutoTrader.com impacted equally in your market by adoption of a velocity pricing strategy? I doubt your trainer, or anyone else, can answer these questions.

Cost per VDP

Dennis was once a leading advocate for Cost per VDP as the strongest comparative metric. It remains the supreme metric for comparing one Cars.com package to another or one AutoTrader.com package to another. VDPs are very useful in comparing packages within a company, but they cannot be compared across companies. DrivingSalesData.com is a site that allows dealers to anonymously input their data and see where they stand relative to competing dealers, at no cost. Within that site, we have gathered enough trending data from enough dealers using both services to be extremely confident in saying this vital metric is not comparable across companies as currently reported.

Cost Per Sale

Cost Per Sale relies on your ability to track all five forms of contact generated by these sites: phone, email, chat, visit to your dealership site, and walk-in. Of these, walk-in traffic is largely thought to be the one generating the largest numbers and the one that is most difficult to track. Does your sourcing program include attribution to the entire network of sites or just the core site? Secondly, not all sales have the same value. Does the site do a good job of selling the portion of your inventory that is most difficult to sell, the portion that offers the best margins, or the portion that you were going to sell quickly anyway? Cost per Sale is a useful metric, but not a sufficient metric for comparing one vendor to another.

You Don't Need to Decide

We hate to see dealers waste time on a decision they don't need to make. You don't need to know which service sells more vehicles. You don't even need to know which one is most cost effective. You just need to know that each service is cost effective or you don't buy that service. These services compete over consumers, and they compete over additional places to put their dealers’ inventory and provide exposure for their dealers. But they don't need to compete for dealers. Consequently, you don't need to decide which is best. You have two distinct decisions to make: Should I use Cars.com? Should I use AutoTrader.com? Keep them separate and you'll find them quicker and easier decisions to make. When you find yourself dissatisfied with the results of either, look at the market demand for what you are stocking, your price to market, and your merchandising. Then ask yourself, "Is the product not working sufficiently to justify its price, or am I not working the product?" We have seen both cases, but the only thing that matters to your decision-making is your situation. Whether or not this same thinking applies universally across all listings publisher is something we are still collecting data on.

Jim Bell
I don't know what to make of all of the cars vs. AT thing. We as a dealership look at all trackables with the same lens with every vendor we use. AT is always higher just due to the fact that they are so much more in cost. When sales are good, they like to take a lot of credit to that success and I feel that is not right. We have had some of the biggest months in the store's history, and the AT SRPs and VDPs seems to be stagnant with prior months with no increases. It was the same with cars.com in those big months that we have had. SRPs and VDPs have always been consistent. I'm not saying that AT or cars isn't generating floor traffic, but the SRPs and VDPs on both sites are not a direct corolation of our success. I like the cost per VDP idea, but being at $.80/VDP vs. $.20 is a HUGE difference. I do believe that sourcing is the key, but the consumer is confused themselves. They will call in on a cars.com line and say they saw it on AT or visa versa. They are confused. We will continue to look at the data and also data that Dataium offers and continue to evaluate it month to month. I just don't buy the whole floor traffic thing that they just continue to say they generate. Just my 2 cents.
Jeremy Alicandri
In my last post, I didn't follow your advice of not comparing Cars.com vs. AutoTrader. As I explained, in my experience, Cars.com generates more trackable sales - it used to be AutoTrader.com. With that said, when you take a big picture view of where the industry is headed and the desire for customers to receive transparent information, you'll be even more perplexed.
Russ Chandler
I think sourcing is a really inconsistant came these days. Like Jim said customers are just plain confused half the time on where they came from or what made them decide on a dealer. Customers visit so many sites, so quickly over and over its a combination of things that lands them at the dealer they buy from. As far as AutoTrader vs Cars.com I agree what the point in figuring out who is better? They are both vital to any marketing strategy and a must have if you truely want to compete online in the auto market. I do believe they are resposible for a large portion of floor traffic, however how exactly they contributed to getting them in and at what point during the process did they make the largest influence is hard to tell. Branding, lead generation, or price comarison could all be reasons a customer made it on your lot from Cars.com or AutoTrader. I would rather spend my time focusing on making the most of the dollars I spend with each, then who is worth more. Great article Lindsey!
Philip Moore
If you have the time and the inventory, you can borrow an approach from the operations research discipline to answer the "effectiveness" question for virtually any policy or procedure in your store. The two key factors in executing this approach are the ability to randomly sample your inventory and the ability to hold constant all factors other than the test factor for at least one purchase cycle. In other words, can you do everything the same for at least 45-60 days. The approach is to apply a standardized measure of effectiveness that can be analyzed for any subset of your inventory. In my prior job, we used daily rate of per-unit profit (DROPP). You calculate DROPP by dividing your average net profit by turn. This can be done at the individual car level, for you whole inventory, or for any subset of vehicles. That is the key because you can compare the DROPP for a test set of cars (for example cars you have listed on Autotrader.com) with the DROPP for cars you haven't listed. As long as the test and control sets are selected at random and all other factors for each set are the same, you can attribute the difference to your test variable. Here's an example of this approach. Bob has 60 cars on his lot. He uses the same detailing standards and lot washing schedule for all 60 cars. Bob randomly selects 20 of the 60 to advertise on Autotrader.com, 20 of the 60 to advertise on Cars.com, and leaves 20 of the 60 out of his online listings. For 45 days, Bob changes nothing about his process. Any cars added to the inventory during the 45 days are tracked separately. At the end of 45 days, Bob looks at the data for each set of 20 vehicles: AutoTrader cars 14 sales, average net profit $1400 Cars.com cars 12 sales, average net profit $1600 unlisted cars 10 sales, average net profit $1800 So the DROPP for each set is: AutoTrader 20*45/14=64.3 turn> $1400/64.3 = $21.78 DROPP Cars.com 20*45/12 = 75 turn> $1600/75 = $21.33 DROPP unlisted 20*45/10 = 90 turn> $1800/90 = $20.00 DROPP So Bob determines that AutoTrader is slightly more effective. In this case the results are very close and would warrant a repeated test with a different set of vehicles to confirm the finding. One thing that is clear to Bob from this test is that online advertising has a positive impact on his business. Remember the average net profit calculation includes the expense of advertising those vehicles, so a higher DROPP actually represents more dollars dropping to the bottom line.
Dennis Galbraith
Russ, I think you have the right approach. For most dealers there is plenty of opportunity to get to more out of what they are already paying for through better vehicle merchandising. Better merchandising will also improve site conversion.

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