Dallas, Texas — It's no secret that with more and more franchise dealers aggressively ramping up their used-car departments, independent dealers are facing increasing pressure to find fresh ways to keep up with the competition or see their profit margins further erode or, worst yet, have to close up shop. 

So to help used-car dealers go head-to-head with the franchise stores and not get left in the dust, two industry veterans showed the independent owners how to effectively maximize the Internet. They did that by exposing and debunking a dozen myths during a packed general session Thursday at the National Independent Automobile Dealers Association convention. 

Joe Lescota, chair of automotive marketing at Northwood University, and Chip Perry, president and chief executive officer of AutoTrader.com, examined 12 myths of used-car Internet sales and then presented what they perceived to be reality. 

1) Myth: The automotive Internet is more about new-car shopping than used-car shopping. 

Reality: There is tremendous opportunity to sell used cars via the Internet. 

Lescota pointed out that according to the 2007 J.D. Power and Associates New AutoShopper.com and Used AutoShopper.com Study, 61 percent of used-vehicle buyers use the Internet when shopping for a used car. 

"And online used-car shoppers outnumber new-car shoppers by more than two to one," he added. 

"It's not about new cars. It's about used cars. The math is clear about that. You need to be there," Lescota stated. 

2) Myth: Newspaper, television and radio still deserve the largest share of a dealership's advertising budget. 

Reality: Dealers should reconsider allocation of their ad budgets. 

Lescota referred to the 2007 NADA Franchise Dealer Media Spread Analysis that revealed that newspapers continue to command the lion's share of dealer advertising (27 percent), followed by television (17 percent); radio (17 percent); Internet (17 percent); direct mail (10 percent); and other (12 percent). 

But according to the 2007 New Vehicle Shopping Media Usage Study from the R.L. Polk Co., car shoppers found that the Internet was the most useful shopping source (42 percent), whereas TV was at 8 percent, direct marketing was at 2 percent and radio and newspapers were both at 1 percent. 

"Do you know where your customers are truly coming from? You should be wise enough to evaluate your own market and the effectiveness of your advertising dollars and what they are giving back in return," Lescota said. 

3) Myth: It's all about search. 

Reality: Consumers use classified sites to find specific vehicles and dealers. 

"While it's helpful to be tied up in search, if you're not on page 1 or page 2 on Google, we all know that you're basically dead because no one goes past those pages. You have to be high up," Perry pointed out. 

"Whereas, with the classified sites, you know you're going to be visible. Classified sites and dealership Web sites are where people go specifically to find dealerships and vehicles," he explained. "Search is important, but it is by no means the driver." 

4) Myth: I am reworking our Internet strategy and I do not have the time or resources to get involved with third-party Web sites. 

Reality: All you need is a phone, digital camera and a capable used-car manager to jump start your online business. 

"A good digital camera, involved management, a polite and engaging receptionist who knows how to answer and talk on the phone and a quality inventory uploading tool are the tools needed to advertise your inventory and dealership on the Internet," Perry said. 

"You don't need a fancy Internet department," he stated. "All you really need are listings on a site that people can visit and the ability to pick up a phone when they call you." 

5) Myth: E-mail leads are my most important measure of success. 

Reality: Better measures of success are phone-ups and walk-ins stimulated by my online advertising. 

"We want to create enough information and stimulus to cause customers to pick up a telephone, have contact with us and eventually walk in to our stores. Our goal is not to communicate back and forth via e-mail," Lescota said. 

"Let's quit spinning our wheels on the technology and think about how technology works emotionally. That's what we're looking for," he added.  ...