Extending Your Ability to Reach More Buyers in More Places to Sell More Cars

Thank you so much for joining us for this, version of the AutoTrader WardsAuto FastChat. With me today is Peter Topazio. He’s the Client Success Manager for AutoTrader and Kelley Blue Book. Peter, thank you so much for taking time out of your crazy schedule to chat with us today. We really appreciate it.

Hi, Nancy. Pleasure’s all mine. First time, long time. So thanks for having me. Oh, well, thanks for being here.

You know, it’s funny, we’ve been writing a lot in WardsAuto about how consumers have gotten so used to, I probably shouldn’t use this term, but they call it the “Amazon effect”, where it’s simple. You click a button, it comes to your house. There you are. And whether they like it or not, I mean dealers, we’ve seen data that shows that dealers are competing with that kind of e-commerce space.

And again, shoppers just want to quickly and easily research, complete all kinds of purchases.

You know, I know people have been buying sofas and dining room sets and everything. You know, as consumers look towards that kind of e-commerce marketplace, it seems that offering vehicle home delivery, would be important for dealers and for OEMs. Yeah. You know, I think in, in today’s landscape and over the course of the, the internet, really, I mean, a lot of consumers have become what I would consider entitled because they find everything as soon as they possibly can, and they want it now. You know, in the digital age, it’s it’s hard pressed not to find something within a second.

You know, the average car buying cycle is 61 days. So they are going to be doing a lot of searches and and taking their time and getting a lot of information into their queue. But to your point, I think what we’re finding when we talk about our dealer community is that the dealers that are being proactive as opposed to reactive, are the ones that are really getting the lion’s share of those consumers that are expecting things right now in, you know, at their fingertips.

You know, it’s no secret to anyone that auto retail has gone through incredible changes in the past five years. Certainly, dealers have always looked to, get a leg up on their competition and bring in more sales, of course.

It seems like now is the time to really employ more tactics and strategies to do that, for all the reasons we know. Can you tell me a little bit about what AutoTrader does to reach and to help their dealers reach more clients? Yeah, of course. I mean, first and foremost, it’s it’s great to be working for a company that has the number one and number two auto consumer websites in the country, i.e.

Maybe the world. So with that being said, it’s not as simple as just putting your cars on AutoTrader anymore. I mean, obviously we can go back to the three P’s which have been with the company for a long time, but it’s photos, it’s it’s pricing and it’s puffing, i.e. what, you know, you’re merchandizing.

What are you telling the story about that specific unicorn that’s on your lot because every car is different. You know with AutoTrader., most of our consumers will actually change the default mile range. And with that being said, there is a product that was introduced a couple years ago that to me is a no brainer.

With, you know, 95% of my clients who currently have it and it’s called Market Extension Essential.

In a nutshell, what it does is it brings your cars out as many miles as you want. Right. The minimum miles is 250 miles, which is a great starting point. and at a great price point for $500, typically for dealers that have an upwards of 2 or 300 cars. And my dealers have found nothing but success when they extend their reach, you know.

I hate using the analogies because I’m not I’m not a big fisherman. But, you know, when I talk to my dealers, it is like fishing in a larger pond, right? So that kind of gives them a, a visual, but not always like fishing in a bigger pond where the water is bigger. But there’s more consumers, and you’re fishing with the bait that they’re looking for. You know, you’re increasing your opportunities and really putting yourself in a position of power.

You know, one question I like to ask my dealers is “when is more ever more advertising a bad idea?” “When it’s reaching more customers, a bad idea?” “When is increasing your footprint a bad idea?” They can’t say it ever is. So it’s it’s really, an assumed product because of the power of AutoTrader, the power of Kelley Blue Book and the power of the consumer experience put your cars in front of more people.

Now, just so I understand.

And and when dealers are looking at what you provide, what is the difference between the typical listing for and and then the market extension. Is that the essential listing? What’s the difference between those two? Well, I love the fact that they call it essential because I truly think it is in today’s malleable automotive industry.

The difference is basically when you when you go to AutoTrader, Kelley Blue Book, you have a zone, so to speak. Where I am, it covers roughly 60, 70 miles. We have a pretty big zone here, in the Portland area. When you advertise on AutoTrader, Kelley Blue Book here, you get put into that zone.

Right?

And the default search criteria is typically 50 miles. ok. A market essential, but market extension essential does is it puts it out 250 miles. So one objection I get from my dealers is “well, I’m going to show up on page 13”. And you know, obviously I ask my dealers, “do you ever call Google and say, I want to be on page three”?

The answer is always no. You know, placement. There’s power in placement. Correct? But what’s so advantageous and so beneficial about Market Extension Essential is that it puts those vehicles out 250 miles.

And yes, it’s after the zoned vehicles. But with AutoTrader and Kelley Blue Book, we don’t count a search result page or virtual detail page or as I say, virtual drive by virtual test drive until eyeballs see it or until consumer clicks on it. So not only is it, it’s a great position of power for that dealer to put vehicles in an area where there may not be as many of those like same make, model year, price point, whatever the case may be. Once again, every car’s a unicorn, but it it provides the consumers the opportunity to see and click on something that they otherwise they wouldn’t have anyway.

I think you would agree with me that really every dealership, is a unicorn in a way too.

And I guess I’m looking as if I was a dealer. I would wonder, you know, is, is this Market Extension Essential a smart move for me? What should I consider when I’m looking at this? It’s a no brainer. Is is the answer.

It’s not only a smart move. If you haven’t done it. You’re behind the times. you know, typically when you look at the dealership community, once again, I can say 100 times when it comes to online advertising, placement is key, right? And what market extension essential does is it gives you placement in areas that you do not currently have.

So when a dealer says, why is this important to me? It’s it’s why wouldn’t it be important to you? Do you, you know, say you’ve got a Toyota Camry, an objection I get all the time as well. I just have, you know, a non scarce vehicle, so to speak. Okay, great.

Well, maybe in Portland there are a thousand vehicles that are like the one you have, but 80 miles from now or 100 miles from here, there may not be that many.

So your car becomes less scarce and becomes more into a consumer’s purchase process. So to answer the question to the dealers, why would I want to do this? It’s very simple. Why wouldn’t you?

You know, more advertising is never bad. Putting the vehicles that you have painstakingly taking the time to purchase to recon on the used side, which we know is obviously very hard right now with with these car prices being inflated or on the new side where allocations are, are very vast right now.

So there’s a lot of new car vehicles out there. Why not put your vehicles that are super important to you and your bottom line in front of more consumers? I think you mentioned and correct me if I’m wrong, but I think you mentioned or I read that something like 95% of your clients are on this Market Extension Essential?

Are there any kind of performance metrics you can share with us? Because I know the dealers are always interested in those. Yeah for sure. You know, I think there are two ways to sell, right? You can sell and then you can explain the value on that exceeds the price that’s when the deal gets done.

The value of Market Extension Essential far exceeds the price. And so the value is really threefold. Placement, branding, and opportunity. And when we explain it that way typically the ROI is kind of a no brainer. But yes, to your point, there are some dealers that really like data.

So I have a couple examples. I have a dealer I’m actually meeting with later today.

And he was questioning his Market Extension Essential spend. What I did is I looked at the just year to date, year to date, his VDPs are not as high as his classified VDPs and or his spotlight VDPs, but he is getting a 1.44% click through rate on his Market Extension Essential vehicles.

Now, anybody that works in the digital sector knows that anything north of one is a pretty good click through rate. Most, most SEO companies would be very, very happy with that. and be, projecting that back to their dealers. But on top of that, we talk about really kind of cost per click, right. and I talk about this because that’s really the in the dealer’s vernacular, a lot of times, whether they have an agency or their marketing director or whoever they’re using to to look at the data.

This is a Chevy dealer, not a very large one, but their cost per click is $0.63 per VDP. Now, in the digital world, that’s not very high. That’s a very good cost per virtual test drive, if you will, specifically for somebody outside of your marketplace. On top of that, their cost per view is less than a cent.

So when I talk to this dealer for the amount of money they’re spending every month, they’re spending less than a penny for somebody outside of their market to see their unicorn. They’re trying to sell badly, and they’re spending less than $0.65 for that viewer consumer outside of their market to virtually test drive that vehicle. Now, that’s one example. I do have two others.

One that is, a very specific high line independent. We started just going out 500 miles. The next month we went out a thousand miles. We wanted to include Los Angeles. Now, this is a very high line.

It’s a Porsche dealer. So very specific. Right? His return on investment was ten fold. Very, very quickly.

Right. You know, it’s very easy to tell when you go. That’s amazing! Yeah, you know, it’s That’s incredible..

What I love about this product is that if you go out a thousand miles and you start getting calls for, for us, you start getting calls from Los Angeles, you know why? It’s the only thing you change in your advertising.

So that dealer is now gone national with this Market Extension Essential. Wow. Wow.

And now granted, you may say, well, that’s just the Porsche dealer. That makes sense. Well, I also have, an independent that averages about 200 cars a month. They have also gone national as well. So there there is a lot of opportunity for the dealers, once again, that want to be proactive as opposed to reactive and obtain market share.

That’s really all it is, is, is placement and market share and putting yourself in that position of power, of being in front of the consumers that are looking for like vehicles that you have that otherwise wouldn’t know you had them unless they had Market Extension Essential…

And if I’m a dealer and I’m interested in hearing more, I want to I want to adopt this. who can I contact? What should I do?

Well, I wish you could all contact me, but you cannot, contact you. Take your home number. Yeah, I contact your autotrader Kelley Google client success manager. You could also ask your performance manager for Kelley Blue Book or the auto. And I and I employ my dealers to to ask around, right?

Now, the dealer community can be two sides of the coin, right? One will be honest with each other, and one will say, oh no, that doesn’t work.

But I can tell you it does work. So, reach out to your Autotrader Kelley Blue book rep, your V auto rep, your performance manager. Really?

Anybody within the Cox Automotive suite of products, and they’re going to be able to get you in touch with the person that can really help you get Market Extension Essential and as quick as possible because the customers are there. Your cars aren’t. Until you have this product. And not to put words in your mouth, but you’ve already told us you have the metrics to show how effective it is. So I appreciate.

Yeah. Peter. I know that you have a busy schedule. I so appreciate you taking all this time with us. So thank you for that.

Of course, I appreciate it’s an honor to talk with you and get a chance to, extrapolate good information. You know, when it comes to the auto industry. It’s not always good, and it’s not always pleasant. But this product, like you said, 95% of my clients have it, and they keep it.

And there’s a reason.

I want to thank everyone for watching this Autotrader WardsAuto Fast Chat. I’m Nancy Dunham, Principal Analyst for Retail at WardsAuto, and I’ve been speaking with Peter Topazio, who is the Client Success Manager at Auto Trader, and Kelley Blue Book. Thanks so much again for tuning in. Thanks, Nancy. Thank you.

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