Dealerships

5 components of tool to deliver customized dealership ads based on user’s web activity

FORT WORTH, Texas - 

Imagine potential buyers receiving customized advertisements for your dealership before they even begin to navigate through your store website.

That’s the outcome Simpli.fi says it can deliver by introducing Prospecting Dynamic Creative for Auto, what the company claims is the industry’s first and only upper-funnel dynamic creative programmatic tool that can generate dynamic ads to buyers even before they visit a seller’s website.

The company explained this turnkey solution requires no integration to an advertiser’s inventory management system, making it more efficient for dealers who want a powerful programmatic solution that is simple, quick to set up and delivers rapid ROI.

Simpli.fi’s Prospecting Dynamic Creative for Auto can serve ads to potential buyers based on upper-funnel behaviors, such as keyword searches and the contextual content they are reading.

If a prospective buyer has searched for electric cars and read up on the environmental benefits of the vehicle, Prospecting Dynamic Creative for Auto will serve them a personalized dynamic ad showing the local dealer’s actual inventory that matches the make, model and even color vehicle in which they are interested.

Officials went on to highlight that Simpli.fi’s Prospecting Dynamic Creative for Auto is unique in that it can provide:

—An industry first that does not require a buyer to visit a dealership’s website before they are served a dynamically-generated ad showing actual inventory from that dealer

—A turnkey solution for the auto industry that requires no integration with inventory software (which is required of many dynamic ad solutions)

—Connections to buyer behavior so it can dynamically serve ads based on keywords searched and contextual content read

—Efficiencies for both buyers and dealerships. When user clicks on a dynamic ad they are taken to dealer’s vehicle dealer page (VDP) 

—Customizable ads. Customers can use their own ad templates and creative assets or take advantage of Simpli.fi templates that can be edited and personalized.

Since its inception, Simpli.fi has focused on building innovative programmatic solutions that drive stronger ROI for its clients. Prospecting Dynamic Creative for Auto is the latest unique solution from Simpli.fi that leverages unstructured data to target buyers at a much more granular level.

Simpli.fi’s use of automation and unstructured data can enable the company to efficiently deliver programmatic advertising to high volumes of localized and personalized campaigns.

“One-to-one marketing is the goal across all industries, and with this new dynamic creative solution we are helping our customers achieve that goal. Advertisers are now able to touch prospects very early in their buying journey with content that’s meaningful, relevant and timely,” said Frost Prioleau, chief executive off of Simpli.fi.

“The auto industry is an important vertical for Simpli.fi, and is a great fit for the granularity we offer through our use of unstructured data. We’re looking forward to bringing this type of solution to other industry categories that need it,” Prioleau went on to say.

For more information about the company or partnership opportunities visit www.simpli.fi.

VINFactor releases new 'save car feature' for dealers

ATLANTA - 

Automotive technology provider VINFactor has released a new saved cars feature that allows dealers to save vehicles across any website or software tool during the vehicle research and acquisition process.

Dealers using the recently launched VINFactor product can now click on any VIN on any website to activate the new car saving feature.

The company said this and other new product features are based on dealer feedback.

“This is the first time that a dealer can save any and every vehicle, no matter the website that they’re visiting,” VINFactor founder Steve Greenfield said in a news release. “We’ve listened to dealers who have been using VINFactor, and they’ve asked us for the ability to save cars as they use auction websites, their appraisal tool and even other dealership websites. Now they’ll be able to collect all of their saved vehicles in one easy to manage list that is always available in their browser.”

In addition to the new feature, the free product provides dealers with real-time actionable insights that are available inside the browser.

“Dealers have historically been challenged with a bunch of different software products that don’t work together,” added Greenfield. “VINFactor is the solution that bridges this gap between the various websites and software tools that a dealer uses, smoothing out their internal processes.”

Study: Brand loyalty, growing mass market interest give rise to luxury segment sales

CARY, N.C. - 

Luxury sales have steadily grown over the past three years due to the segment’s consistent owner loyalty and growing appeal among mass market vehicle owners, according to recent data from Jumpstart Media.

The luxury segment currently accounts for 13 percent of total sales, up 3 percent from 2014, shows the company’s latest auto shopper study in collaboration with Ipsos Connect, “Today’s Luxury Auto Owners: How Emotion, Experience, And Loyalty Drive Purchase Decisions.”

At 36 percent, a larger number of mass market owners say that they are interested in upgrading to a luxury vehicle.

Across Jumpstart sites, 34 percent of shoppers are researching luxury vehicles, up 4 percent from 2014, according to the company.

With the addition of more entry-level options offered at lower prices, a number of luxury brands have become more accessible to mass market owners in recent years, says Jumpstart senior web analyst Brian Miller.

“You’re seeing a lot more entry-level luxury options from traditional high-end brands such as BMW with its 1-Series, as well as Mercedes-Benz, Lexus and even Audi. Each of these brands realize the competitive forces being brought from mass-market producers and have focused significantly in competing for the entry-luxury shopper’s interest. I think the CLA-Class and A3 are the biggest examples,” Miller explained in an email interview with Auto Remarketing.

The amount of CPO options available today can be a draw for many of today’s mass market owners as well, according to Miller.

“The rise in luxury has certainly played a large role in the rise of CPO choices over the last few years. This, combined with the fact that a third of all vehicles have been leased in a very hot auto market now for several years, with luxury defining much of the leased market, means CPO has a lot of luxury choices today, and will for years to come,” he said.

Miller also acknowledges that maintenance costs associated with luxury vehicles can bring anxiety to both prospective and current owners.

The study found that 56 percent of mass market owners purchase a non-luxury car as their primary vehicle due to cost of ownership, and 41 percent of luxury owners spent more on maintenance than they expected.

“On average, maintenance cost in the past year has been two times greater among luxury owners versus mass market,” Miller said.

“The point here is that more so in the luxury market than the mainstream market, maintenance costs are a huge concern. It not only keeps people out of the segment, but is a huge pain point for those who currently own luxury. We heard in the qualitative that CPO helps bring peace of mind, so we do feel that the proliferation of CPO can be attributed to luxury.”

Because of price and value, Miller points out that non-luxury choices fitted with advanced technology and features have also appealed to consumers in recent years.
“The traditional luxury brands will always carry with them a healthy amount of fans due to brand loyalty. No doubt, these brands have worked hard over the years to build this loyalty, and the quality in their vehicles is among the most evident reasons why. That being said, there are a growing number of auto shoppers on the fringe that are just as interested in price and value, as much as they are interested in luxury features. This group will continue to explore choices produced by mass-market manufacturers.

When asked, “Which of the following attributes best describes luxury to you?,” nearly twice as many owners defined luxury as quality versus innovation.

Sixty-eight percent of luxury owners stated “quality”, while only 36 percent said “innovation.”

Among non-luxury owners, 93 percent listed “excellent quality” as a must-have for a luxury vehicle purchase, according to Jumpstart.

To capitalize on growing mass market interest in luxury, Miller said marketers should concentrate on promoting quality brand experience.

“Based on what we found in the latest joint report with Ipsos, auto marketers must focus on a quality brand experience in order to capture the interest and loyalty of today’s luxury shopper,” he said. “Gone are the days of retaining a customer just on brand alone.

“Marketers that successfully grow share in luxury will offer the right experience that includes service and maintenance options, and they will focus on demographics, cultures and age groups outside of yesterday’s perception of more established shoppers by age,” Miller continued.

Additionally, the study found that luxury owners are more likely to be self-employed, and 69 percent are likely to use their vehicles primarily for their personal business.

A large portion of luxury owners are younger today as well; 34 percent are between the ages of 25 and 34, according to the study.

CDK announces support for PCG's auto industry Google Analytics specification

HOFFMAN ESTATES, Ill. - 

CDK Global announced Friday that CDK websites will support the specification for Google Analytics that PCG Companies released for automotive dealers last year.

CDK dealers and dealer groups can now independently review website and marketing performance data from Google Analytics.

“We are excited to offer our dealers a standardized implementation of Google Analytics,” CDK Global product officer of consumer-facing products Max Steckler said in a news release.

“The demand for GA support from customers continues to grow, so it is the right time to meet that need and support this open standard. By leveraging the PCG specifications, our enterprise clients will be able to more easily compare the performance of our latest website technology and marketing solutions in their multi-vendor eco-system.”

The PCG specification provides dealer groups with a standardized set of measurement metrics across website platforms that can help dealers increase Return on Ad Spend from their marketing partners, according to CDK.

“Implementation of the PCG specification will be based on the CDK website data layer – a W3C specification for the uniform presentation of website data, which CDK supports with our responsive website platform,” the company said.

CDK joins a growing list of companies such as CarNow, which have recently publicly endorsed and implemented the PCG specification.

“By supporting a standardized implementation of Google Analytics, CDK demonstrates its willingness to increase data transparency with its clients. The PCG specification will allow dealers to more consistently document website conversions and engagement to improve marketing outcomes,” said Brian Pasch, founder of PCG Companies. “The support of the specification will also allow CDK clients to immediately leverage the independent data insights and traffic quality metrics in VistaDash, our popular Business Intelligence (BI) cloud software.”

This is the second specification published by PCG that has received widespread support from the automotive vendor community, according to CDK.

JM&A Group releases new dealer portal built to speed up online transactions

DEERFIELD BEACH, Fla. - 

JM&A Group recently introduced Dealer Source, its new application portal designed to speed up online transactions.

The new portal’s self-service capabilities can help dealers improve efficiencies and the customer experience, according to the company.

“Part of the value we bring to our dealers is in-store support for their day-to-day operations, and resources to increase their productivity,” said Gavin Tennant, vice president of customer services. “Dealer Source is an intuitive tool to further these efforts and streamline the processes our dealers already have in place.”

Dealer Source includes VIN scanning technology, contract entry, claim inquiry and invoice transaction history.

In addition to multiple browsers, the portal will enable complete functionality on any mobile device.

Podcast: John Possumato for Lyft

CARY, N.C. - 

Dealers sometimes see potential buyers who just don’t have quite enough cash for the down payment so the financing and vehicle delivery processes can be completed.

Now Lyft has established a dealer-relationship program that could solve the down-payment issue as well as bolster the number of drivers who work for the ride-sharing platform.

Veteran industry consultant John Possumato is working with Lyft and sat down with Nick during the recent Fall BHPH Conference hosted by the National Alliance of Buy-Here, Pay-Here Dealers to discuss this program.

Check out the conversation below.

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Lithia moves closer to used-vehicle per dealership sales goal

Lithia Motors is moving closer to its used-vehicle sales goal.

In its third quarter that ended Sept. 30, the Medford, Ore., new-car dealership group retailed an average of 67 used cars and trucks per store, per month. That was up from 65 in the year-ago quarter, said its president Bryan DeBoer.

Lithia’s goal is to sell an average of 85 used-vehicles, per store, per month, DeBoer said.

Over the last several years Lithia has been on a buying spree, acquiring single-line dealerships and large dealership groups.

The dealerships it purchases are typically underperforming their potential and sell significantly fewer used vehicles than the 71 units per month average sold by stores Lithia has owned for more than two years. The typical dealership Lithia acquires sells about 38 used-vehicles per month, DeBoer said.

“We are making incremental progress towards our goal of 85 used units per store, more than offsetting the effect of acquisitions that sell fewer used vehicles than our seasoned stores do,” DeBoer said during the company’s quarterly earnings conference call in October.

“I think our opportunity is coming in the three- to eight-year-old vehicle, which is still somewhat depressed,” he said. “And that’s what’s going to really take us up to that next level and get to that 85 units per store.”

Three- to 8-year-old cars and trucks Lithia calls “core” vehicles generate a gross profit margin of about 12 percent, DeBoer said.

The company’s gross profit margin on certified vehicles is 8 percent to 9 percent and its “value” vehicles over 8 years old yield a gross profit margin of about 18 percent, he added.

Publicly held Lithia operates 166 dealerships, representing 30 vehicle brands in 18 states.

This year, Lithia has opened one dealership and acquired 15 others. Its latest acquisition is Downtown Los Angeles Auto Group in Los Angeles, which it purchased in its third quarter.

Lithia chief financial officer John North said the company anticipates buying more dealerships, especially if the seasonally adjusted selling rate plateaus or slows down.

“Conversely, if the SAAR is strong, it’s going to keep acquisitions maybe on the sidelines a bit more,” North added.

Revenue grows, net income drops

Lithia’s net income in the quarter that ended Sept. 30 dropped 4 percent to $51.9 million compared to the same quarter last year. But its revenue for the quarter grew 18.7 percent to $2.7 billion compared to last year.

Used-vehicle retail sales accounted for $679.6 million of that revenue, which was a 17.0-percent improvement over last year’s third-quarter results. The company retailed 34,737 used cars and trucks in the quarter, up 17.2 percent.

The average selling prices of a used car or truck at Lithia dealerships slipped 0.2 percent to $19,565 in the quarter, and the average gross profit per used unit retailed dropped 2.5 percent to $2,264.

Lithia’s same-store retail used-vehicle revenue was up 1 percent to $2.3 billion, same-store used retail sales grew 3.3 percent to 30,133 units and same-store average gross profit per vehicle retailed was up 1.1 percent to $2,364.

Same-store sales of certified used vehicles account for about a quarter of those sales but were “down a little bit” from July through September, DeBoer said.

In the quarter, same-store certified unit sales volume decreased 4 percent, core unit volume increased 7 percent and value auto unit volume increased 4 percent.

‘Mining core product’

“When certified are pretty plentiful, which they are now, they’re easy to find, which means we can spend our time on going and mining core product and value product, which is where we make all of our money,” DeBoer said.

As of Sept. 30, Lithia’s days’ supply of used vehicles stood at 63, up from 57 on the same day last year. North said the uptick in used-vehicle supply is a result of the company ramping up used inventory before cost of sales catches up.

“When you look at the aging overall, we’re really comfortable with where the level is,” North said. “We think that those are investments. That’s the incremental dry powder we’re trying to unlock.”

Lithia’s retail new-vehicle sales in the quarter grew 18.6 percent to 45,570, and average gross profit per new vehicle retailed dropped 2.1 percent to $1,932. The average new vehicle selling price rose 1.2 percent to $34,169.

Lithia reported that F&I revenue in the quarter was up 15.2 percent to $101.0 million and that average F&I gross profit per unit slid 2.4 percent to $1,258. F&I gross profit generated by recently acquired dealerships ranged from $800 to $1,100 per unit while it was “running north of $1,400 a copy” on Lithia’s more seasoned stores, said Christopher Holzshu, Lithia executive vice president and chief human resources officer.

Of the vehicles Lithia retailed in the quarter, it arranged financing on 72 percent, sold a service contract on 45 percent and sold a lifetime oil product on 26 percent, North said

Standalone used-car stores a big 'opportunity' for Penske

BLOOMFIELD HILLS, Mich.  - 

During the Q&A portion of Penske Automotive Group’s latest quarterly earnings call, chairman Rogers Penske was asked if his viewpoint on CarShop and CarSense had changed since the dealer group purchased the respective used-car standalone retailers.

 “Yeah, it’s changed. I like it more,” Penske said with a laugh.

“I think we’re very fortunate to get into this business,” he said. “The technology, the people. We’ve had no turnover with senior management. Both of these businesses, I think they applaud the fact we’ve come in with capital, with ideas, with an expansion mode offense.”

Fortunate and prudent, perhaps.  

Quarterly numbers, expansion plans

In the third quarter, Penske Automotive’s standalone used-car businesses — which include CarSense in the U.S. and CarShop in the U.K — retailed 11,626 units.

Year-to-date, which includes results since acquisition, the standalone platforms have retailed 30,952 used units.  

Quarterly revenue from the standalone stores in Q3 approached $200 million, while year-to-date revenue was at $535.7 million.

Gross profit per unit retail was at $1,152 in the quarter, with the year-to-date figure at $1,222.  

F&I gross profit per unit on these sales were $1,188 in Q3 and $1,182 year-to-date, putting the total variable gross profit per unit at $2,340 and $2,404, respectively.

“We believe these used-vehicle dealerships further diversify our business and provide an opportunity to capitalize on a highly fragmented used-vehicle marketplace. We also believe these businesses provide an unlimited white space for scalable expansion,” Penske said during the call. “We’ve identified several new markets for expansion of the CarSense and CarShop brands and are on track to double those number of locations within 24 months of the initial purchase.”

The group announced in early January it had signed an agreement to buy CarShop, a chain of five standalone used-car retail stores in the U.K. That deal ultimately closed in February.  Penske announced the purchase of US-based CarSense in December, then closed that purchase in January.

There are likely to be a handful or more of expansions from these two platforms.

In the U.S. in particular, CarSense will likely be “growing off that base” in Pennsylvania and New Jersey.

“The interesting thing is, when you look at those two businesses, take all the inventory out, probably the total net-book value of the fixed assets is probably around $5 or $6 million,” he said. “So we don’t have tens of millions of dollars of fixed assets … we have cash and we have cars and we have profit.”

Penske’s goal is to take what its learning from those standalone stores and see if it can be utilized in the retailer’s traditional business. However, the goal is not — or does not appear to be — to compete with CarMax.

Brushing aside any comparison to CarMax, Penske said that used-car giant exists in a “zip code that we’re not in.”

Penske’s goal, rather, is to go into areas that can be scalable for the company, where it has employees, and so forth.  

“What we’re trying to do is look at areas that we can go into, where we have scale and we have people that we could transfer from the traditional business into this business as we expand,” he said. “I’m very confident that we’ll see at least six, either through acquisition or new-store openings, take place in our two businesses next year.”

Fair investment

These standalone stores, of course, aren’t the only used-car projects on Penske’s radar.

Fair, an app that provides used-car leasing to consumers on a flexible basis, announced on Oct. 20 that it was closing a BMW i Ventures-led strategic funding round that also includes investments from Penske Automotive Group, among other strategic investors.

In a news release, Fair founder and chief executive officer Scott Painter said the company will utilize Penske’s physical infrastructure.

In the same release, Penske president Robert Kurnick said: “Penske is committed to be on the leading edge of technology, and our investment with Fair reflects that commitment. The potential appeal of the Fair app to consumers is compelling while keeping our company at the forefront of bringing mobility solutions to the marketplace.”

During the quarterly call, Roger Penske also discussed the Fair investment.  

“We’ve invested $1.2 million, less than 1-percent ownership. We think this is an interesting startup,” he said. “You’re seeing GM and Ford and all these other people investing in some of these different business ventures and ideas, so we’re going to learn from this one and see if there’s any way that this might have an application to us at this particular time.”

Penske added that the company is exploring making $1 million to $5 million investments in similar projects like ride-sharing over the next 12 months.

 

 

 

 

 

Pearl integrates Experian's propensity scoring platform

DALLAS - 

Pearl Technology Holdings announced it has expanded its relationship with Experian to integrate its propensity scoring platform, designed to target consumers who have the highest propensity to make a purchase or lease a vehicle within a particular period of time.

Pearl now has the capability to calculate more than 1,000 elements when scoring a consumer’s propensity to buy or lease.

“We are simply thrilled to expand our relationship with Experian. We contemplated building our own scoring methodology, but ultimately there is no better data or analytic interpreter than Experian,” Pearl chief executive officer and founder Bruce Thompson said in a news release.

“Understanding what consumers are likely to purchase or lease, as well as when, is what it’s all about. Overlaying our existing technology on top of 240 million pre-screened records allows our clients to win big with much less investment. No more wasted advertising dollars with a shotgun approach. This new integrated platform gives Pearl one of the most powerful and accurate vehicle marketing system in the industry,” he continued.

Additionally, the newly enhanced platform enables Pearl to help dealers identify and market to pre-owned buyers, who amount to the largest segment of buyers, according to the company.

“We’re excited to continue our work with the Pearl team,” said John Gray, Experian automotive business unit president. “Understanding the current market landscape and when a consumer is in the market to buy is critical for automotive dealers and OEMs alike. With these insights available, dealers will be able to unlock the potential of the data and to uncover new pockets of opportunity, increase profitability and improve the overall consumer experience.”

Pearl’s incentive-based marketing platform VehicleXchange evaluates nearly 50,000 Experian consumer pre-screens per day for dealer and OEM clients.

CarMax names next COO

RICHMOND, Va.  - 

CarMax chief operating officer Cliff Wood will retire by the end of next summer, the company said Monday.

Taking on the COO role at that point will be Ed Hill, who has been CarMax’s executive vice president, strategy and business transformation since 2016.

Wood has been with the company since 1993, when he was a buyer at the first CarMax location in Richmond, Va.

“Cliff has been instrumental in building CarMax’s industry-leading store operations,” said Bill Nash, CarMax president and chief executive officer, in a news release. “He has helped guide the company successfully through many years of growth and has built a strong field leadership team.

“We are incredibly grateful for his many years of service and contributions to CarMax’s success.”

Hill, meanwhile, has been with the company since 1995, when he came aboard as director of service operations, eventually becoming senior vice president in 2012 and leading corporate strategy.

“Ed was the driving force behind the development and ongoing enhancement of our vehicle reconditioning process, one of CarMax’s key competitive advantages,” Nash said. “He has been an integral member of the executive leadership team, and his breadth of experience in operations, corporate strategy and enterprise change management will be essential for our future growth.”

In moves effective Wednesday, CarMax said Darren Newberry will be promoted from vice president of regional sales to senior vice president of store operations, and Joe Wilson is being promoted from vice president of merchandising operations to senior vice president, store strategy and logistics.