ATLANTA -

Making its first investment in online retailing, Cox Automotive has introduced a new company to its lineup called MakeMyDeal, a communication platform that allows dealers and consumers to begin putting together a purchase deal online.

Shoppers get to begin setting up the deal from their home computer or wherever they so choose, while the benefit for dealers, the company says, is they maintain control of the deal structure.

Dealers can get the information they need from consumers and are able to work closely with the shoppers and manage the deal’s structure. Dealers are not required to honor any third-party price guarantee.

“There’s no question that online retailing is coming to automotive, but we firmly believe that the ‘shopping cart e-commerce’ model that works for books and electronics, doesn’t translate to automotive retail for the majority of car buyers,” MakeMyDeal founder and general manager said Mike Burgiss said in the product announcement released Tuesday.

“People will continue to buy cars from people, so we designed a platform based on our philosophy of connection commerce, which puts the relationship between the dealer and the consumer first while enabling the deal structuring process to take place online,” he added.

The news releases explains in six steps how MakeMyDeal works, as listed below:

  1. Shoppers visit dealership websites for any dealers who participate in the MakeMyDeal platform.
  2. Once they land on the VDP (vehicle details page) of a car they’re interested in purchasing, they can start personalizing the deal by using the MakeMyDeal self-penciling experience located next to the vehicle photos and advertised price.
  3. Shoppers setup an account for the MakeMyDeal platform to connect and communicate with the dealership around the terms of their car deal.Shoppers provide the following information to create a personalized deal structure and monthly payment estimate on their vehicle of interest: 
    — Purchase price offer (this is not included for single price inventory)
    — Needed information to obtain a trade-in value
    — Credit tier and desired length of term for financing
    — Down payment amount
  4. After a shopper saves and submits a proposed deal, a dealership representative receives the details along with the shopper’s username and personal message to the dealership, which may include pertinent questions and details the shopper has shared about his/her buying situation. 
  5. The shopper receives an alert from MakeMyDeal when the dealership sales representative responds to the offer by “accepting” or responding with an updated deal structure.
  6. At any point during the process, the shopper can decide to visit the dealership or schedule a test drive. When shoppers are ready to take the next step, they receive a MakeMyDeal Deal Summary, which includes instructions for completing the purchase in the dealership.

Development of MakeMyDeal & Its Goals

Prior to Tuesday’s announcement, Auto Remarketing talked with Burgiss about the development of MakeMyDeal, what the company aims to foster between dealers and consumers, what the future entail for this platform and more.

In developing the platform, Burgiss said they conducted focus groups, while also utilizing consumer and dealer research from Cox Automotive.

He pointed to data found in this research indicating that the four pain points of the car-shopping process for consumers are most often the following: price negotiation, arranging financing, trade valuation and taking care of paperwork.

The experience of working through those steps — which typically takes place at the dealership — can be “a stressful one,” for shoppers, Burgiss said.

“What MakeMyDeal is really all about is creating a consumer experience that addresses those concerns through a deal communication platform,” he said.

Taking care of those concerns online is something that can help alleviate that stress. In fact, Burgiss mentions in the news release: “MakeMyDeal bridges the online and offline experiences by enabling dealers and consumers to build meaningful business relationships and come together on the terms of the deal online. And it does that all while alleviating some of shoppers’ top frustrations and giving them an experience, an online experience, that they prefer.”

Going back to Burgiss’ thoughts on the “shopping cart e-commerce” model versus the “connection commerce” model, he explained why he believes the former doesn’t necessarily work in the car business.

For starters, cars are often the second, if not first, largest purchase for many people.

“The other reason that I believe people will continue to sell cars to people, not computers — in other words, connection commerce is the future, instead of shopping cart e-commerce — is because it is a very complicated transaction.

A car deal, he said, has taxes, fees and can often include such considerations as debt-to-income ratio and payment-to-income ratio.

Putting together a car deal, Burgiss says, includes many elements that “would be very challenging” to navigate alone for a consumer “who doesn’t buy a car every day and doesn’t know how that process works.”

Platform Growth

Currently, there are approximately 100 dealers using MakeMyDeal and that number is “growing every day,” Burgiss said.  

When asked about the initial reaction from these dealers, he said: “First of all, they tell us that they’re surprised at how open consumers are with them about their car-buying situation, what I call their ‘car-buying story.’”

Burgiss added: “When you let the customer tell you their car-buying story right there on your VDP, they’re very open with you. They’re very forthcoming about how much cash-down they have, about the trade-in condition of the vehicle that they really believe is the value of their car.”

He went on to mention that MakeMyDeal aims to solve the “relationship imbalance” that he believes exists on vehicle details pages.

“The VDP has a lead form that asks me for my information as a consumer. It makes me go first in the relationship. And what we’re doing is helping that relationship imbalance be solved by letting the dealer and the consumer connect in a way that doesn’t make the consumer go first in the relationship … selling cars is a relationship business. You can’t ask your customers to go first in the relationship when you’re in the position of selling.”

So far, dealers have been saying customers arrive at the store more relaxed and happier, he said. They’re primed for a test-drive and to finish that paperwork, Burgiss said.

“In other words, they’re mentally closed,” he said. “That phrase that dealers say to us quite often is that the customer is mentally closed when they get here. They haven’t signed any paperwork, but the online experience of coming to an agreement, coming together on the terms of the deal gets that car sold in the mind of the customer.  And then it just becomes a process of completing the transaction.”

As far as where MakeMyDeal goes from here, the company has just begun a “very small” beta test of leasing and is preparing to start a beta test of aftermarket products. The latter will start with vehicle service contracts, where “the same approach applies,” Burgiss said.

“The dealer is in control of structuring the retail pricing of the vehicle service contract. They retail the service contract. We’re a platform for them to communicate that offer to the consumer. ”

Those expansions would be rolled out at a to-be-determined date later this year.