Products/Software

TrueCar Reiterates Dealer Value in IPO Filing

SANTA MONICA, Calif. - 

With a former OEM chief executive officer joining its board and paperwork filed for an initial public offering, activity is buzzing at TrueCar. That IPO paperwork filed with the Securities and Exchange Commission offered a glimpse as to what’s going on underneath the hood of the lead-generation website.

TrueCar indicated the number of common shares to be offered and the price range for the proposed offering have not yet been determined. But according to the registration statement on Form S-1 filed with the SEC, the company is coming off of a year where it generated revenues of $134.0 million and recorded a net loss of $25.1 million.

Of the $134.0 million in revenue, TrueCar noted that 89 percent consisted of transaction revenues with the remaining 11 percent derived primarily from the sale of data and consulting services to the automotive and financial services industries. Transaction revenues primarily consist of fees paid to the by its network of TrueCar Certified Dealers under its pay-for-performance business model where the company generally earn a fee only when a TrueCar user purchases a vehicle from them.

TrueCar mentioned in its SEC filing that its dealer network consists of more than 7,000 dealerships, primarily franchised stores as well as a smaller amount of independent operators.

“We typically charge TrueCar Certified Dealers $299 upon the sale of a new car to a TrueCar user,” company officials said. “In 2013, the overall industry average advertising expense per new car across all forms of media was $616, according to NADA.

“By helping dealers better target their acquisition efforts to in-market consumers using our platform, we believe that dealers can improve their close rates, which results in other operating cost efficiencies such as savings on selling expenses and inventory carrying costs,” they continued.

TrueCar recapped the challenges it has experienced with its dealer network. At the end of 2011 and the beginning of 2012, due to certain regulatory and publicity-related challenges, officials acknowledged many dealers cancelled their agreements with TrueCar, and its franchised dealer count fell from 5,571 on Nov. 30, 2011 to 3,599 on Feb. 28, 2012.

“TrueCar Certified Dealers have no contractual obligation to maintain their relationship with us. Accordingly, these dealers may leave our network at any time or may develop or use other products or services in lieu of ours,” TrueCar officials said in the SEC documents.

“Further, while we believe that our service provides a lower cost, accountable customer acquisition channel, dealers may have difficulty rationalizing their marketing spend across TrueCar and other channels, which potentially has the effect of diluting our dealer value proposition. If we are unable to create and maintain a compelling value proposition for dealers to become and remain TrueCar Certified Dealers, our dealer network would not grow and may begin to decline,” they continued in the filing section that described their risk position.

TrueCar went on to acknowledge that larger dealer groups not choosing to use its services and have a significant impact on its growth possibilities as well as its stock value.

“Although the automobile dealership industry is fragmented, a small number of groups have significant influence over the industry,” TrueCar said. “These groups include state and national dealership associations, state regulators, car manufacturers, consumer groups, individual dealers and consolidated dealer groups. To the extent that these groups believe that automobile dealerships should not partner with us, this belief may become quickly and widely shared by automobile dealerships and we may lose a significant number of dealers in our network.

“A significant number of automobile dealerships are also members of larger dealer groups, and to the extent that a group decides to leave our network, this decision would typically apply to all dealerships within the group,” the company continued.

“We cannot assure you that we will maintain strong relationships with the dealers in our network of TrueCar Certified Dealers or that we will not suffer dealer attrition in the future,” TrueCar officials went on to state in the IPO filing. “We may also have disputes with dealers from time to time, including relating to the collection of fees from them and other matters.

“We may need to modify our products, change pricing or take other actions to address dealer concerns in the future. If a significant number of these automobile dealerships decided to leave our network or change their financial or business relationship with us, then our business, growth, operating results, financial condition and prospects would suffer. Additionally, if we are unable to add dealers to our network, our growth could be impaired,” TrueCar added.

Nonetheless, TrueCar reiterated that it is poised to capitalize the growth potential of rising vehicle sales, referencing some new solutions in the company pipeline.

“In the future, we intend to introduce additional products and services to improve the car-buying and car-ownership experience. For example, we are developing TrueTrade to provide users with an estimated daily market value for their existing cars and a guaranteed trade-in price,” the company said.

“In addition, we are developing TrueLoan and TrueLease to provide users with a more convenient way to finance their cars at TrueCar Certified Dealers,” officials continued. “We are also in the process of launching a number of new services for our dealers designed to enable them to make better informed inventory management and pricing decisions and to close transactions more efficiently.”

With those elements in place, TrueCar decided Friday was a good time to launch the IPO. Goldman, Sachs & Co. and J.P. Morgan Securities will act as the joint book-running managers for the offering.

TrueCar Adds Ex-Hyundai CEO Krafcik to Board

In other company news, TrueCar announced last week that the former top boss at Hyundai Motor America has joined its board of directors.

John Krafcik, former HMA president and chief executive officer, was at the helm of HMA from 2008 to 2013, and will now become a director at TrueCar and serve as a member of the board’s operating committee.

“Very few people are credited with elevating an emerging brand to top-tier status within the automotive industry,” said Scott Painter, founder and CEO of TrueCar.

“John Krafcik is one of those remarkable leaders who has done just that over the last five years. At the heart and soul of his success at Hyundai was the trusted relationship the brand developed with its dealers and customers,” he added.

Krafcik noted: “I believe transparency is a better business model that builds trust between consumers and retailers. I want to help retailers in automotive and other industries build a bridge of trust with consumers, and joining TrueCar lets me get fully immersed in doing exactly that.”

New App Offers DMS Access from Service Lane

CLEARWATER, Fla. - 

Mobile data access right from the service lane is available via a new app extension.

AutoLoop on Tuesday announced the debut of SmartLane, an app extension of AutoLoop Book, available for the Apple iPad.

SmartLane allows auto dealerships running the Book program real-time access to customer data right from the service drive.

“AutoLoop Book is already one of the most user-friendly and feature-rich automotive scheduling programs available,” said Matt Rodeghero, AutoLoop chief product officer.

“SmartLane gives users access to that information where they need it, instead of restricting them to a stationary terminal,” he said. “Being untethered from the desk is a huge advantage for service reps; SmartLane gives them all the information they need to directly engage the client, in a much more personal manner.”

According to Rodeghero, SmartLane ties directly into a subscribing dealership’s customer database so dealers and service staff can access customer information, make notes, review vehicle service history and more, all while standing with the customer in the service lane.

“SmartLane’s comprehensive capabilities translate into easier, faster, more accurate customer check-ins and walk-around inspections,” he said.

Expanding Book’s usability further, SmartLane allows users to scan in a VIN for rapid customer lookup, take photos of damage, and capture electronic signatures from the drive.

Drag-and-drop indicators help point out problem areas, and service recommendations offer vehicle-specific Good-Better-Best service menus.

SmartLane is available as a free download from the Apple App Store, and requires an active AutoLoop Book subscription.

Haystak Highlights Website Platform Capabilities

FORT MYERS, Fla. - 

Haystak Digital Marketing shared more details about its all-new website platform — HAYSTAK KORE360 — a platform the company created in-house using leading-edge technology and data from thousands of top performing dealer websites. 

The company highlighted on Monday that HAYSTAK KORE360 is built for the ever-changing needs of shoppers who demand instant access to information on a variety of devices.  Haystak’s “responsive” technology is geared to adjust the dealership’s website format automatically according to the type of device shoppers use to access the dealership online, making navigation fast and easy whether shoppers use a phone, tablet or desktop computer.    

“We had a great initial launch of HAYSTAK KORE360 at the NADA convention in January. It drew a lot of attention and dealers were excited to see a new website platform built from the ground up with the latest technology and features,” Haystak Digital Marketing founder and general manager Duncan Scarry said.

“In addition to the responsive technology, most dealers particularly liked HAYSTAK KORE360's advanced SEO capabilities, behavioral targeting and timed content features, all of which can help lead to significant increases in traffic, leads and sales,” Scarry continued. “In addition to our focus on providing the latest, most powerful technology, we also continue our commitment to offering the best customer service.”

Scarry went on to mention Haystak’s unique, proprietary search engine optimization reporting can combine organic with paid search results to show the “true dollar” value of organic initiatives.

“SEO content is created dynamically, based on prior keyword performance, thus continuously increasing effectiveness,” Scarry said. “Further, Haystak’s SEO reporting tracks competitive data for comparison and insight.”      

Furthermore, Haystak’s intelligent behavioral targeting can automatically customize the display on the dealership’s website with the most relevant information for shoppers, based on the content they viewed on other popular automotive websites. 

The company said the behavioral display and retargeting tools can help dealers understand what website visitors are looking for from the moment they enter the dealership website, “delivering a truly personalized experience.”    

Finally, officials pointed out HAYSTAK KORE360 also can let dealers control the timing of certain content. Content changes can be scheduled to appear and disappear on specific dates.

For example, dealers can schedule limited time offers and other specials, rebates and incentives to be available on the website for specified periods of time, and then automatically removed from the website when they expire. Also, dealers can quickly and easily create and schedule timed landing pages.

HAYSTAK KORE360 also offers award winning account management. All Haystak search team members are Google and Bing certified and available to consult with customers. In addition, Haystak received the Google AdWords Premier SMB Partner Award for Customer Satisfaction in 2012 and 2013.     

For more details, visit www.haystak.com.

Carfax Used Listings Site Allows Car-History-Specific Search

CENTREVILLE, Va.  - 

In what the company has described as “an innovation in online car shopping,” Carfax announced this morning that online car shoppers at Carfax.com can now search for used vehicles with specific history details — meaning shoppers can tailor their searches to include, for example, vehicles that have service records available or cars with no accidents reported to Carfax, just to name a few modifiers. 

The used cars available on the new listings site are from thousands of dealers and each one comes with a free Carfax Vehicle History Report. (These free Carfax Reports, of course, are for consumers and are provided by dealers.)

The company noted that because the vehicles being shown are based on the history attributes specifically desired by the shopper, it allows the shopping process for site visitors to be easier and quicker.

With key vehicle history details being shown, shoppers can sort through search results in a more time-efficient fashion.

Here’s how it works: Shoppers at Carfax.com begin their search by choosing the history attributes they want in a used car. Also included in the listings from Carfax Advantage Dealers are vehicle price, photos and a detailed description.

Once the shopper finds the car he or she wants to purchase, the consumer can connect with the dealer directly through the car listing on Carfax.com.

Additionally, company officials pointed out, Carfax Used Car Listings is an ad-free selling environment

“I found a great car on Carfax,” said used-car shopper Nathan Walker from Washington state. “I called the dealer immediately and he said the car was not listed in their inventory yet because it was still in detail and undergoing inspection. I already knew from the information in the Carfax listing that I wanted to see it. I drove 40 miles to the dealership and bought the car.”

Offering the dealer perspective, Jeff Best, vice president of used cars for Brown’s Car Stores, said: “We’ve made sure our inventory is included on Carfax.com for years. It’s an easy way for us to get in front of ready-to-buy shoppers. Consumers trust Carfax, which helps build their trust in the cars we list on Carfax.”

Carfax president Dick Raines added: “Millions of online shoppers today click on readily available Carfax Reports to see if the cars they want have a history that meets their needs. Now, consumers can know right away by choosing which history details are most important to them at the beginning of their search. Carfax puts the right cars with the right history right in front of you.”