While the standardization of multi-platform selling is a hot topic among auctions and consignors alike, there’s a new dealer-to-dealer platform that’s likely to turn some heads in the online wholesale selling environment, as well.

Aiming to spur a similar change on the wholesale side that sites like AutoTrader.com and Cars.com did on the retail dealer-to-consumer side in the late 1990s, Greg Easterly is leading the charge at DealerMatch, a new subscription-based Web and mobile platform for dealers to trade vehicles that revolves around network building.

Easterly is the president of this growing company that is part of Cox Enterprises just like auction giant Manheim, but interestingly enough, challenges the auction business model — something from which Easterly doesn’t shy away.

During his discussion with Auto Remarketing, he also explained the origins of DealerMatch and what he hopes to accomplish in the wholesale space.

“(Retail consumers) had very little access to information about used cars,” Easterly said of the days before online classifieds sites took hold. “As recently as 15 years ago, it was a very arduous process. And AutoConnect, which became AutoTrader.com, and their competitors like Cars.com came along and changed that pretty dramatically.

“The theme behind DealerMatch is really the same story for dealers on the wholesale side,” said Easterly. “So, that transparency that consumers gained with AutoTrader.com and Cars.com putting all the information up online — which gave them a lot of power in shopping for and negotiating the used-car deal — is the same mission we have at DealerMatch: to empower dealers to be able to grow their profits and reclaim some of their lost margins.”

A shopper arrives on a dealer’s lot “armed to the teeth” with information about the car the dealer is selling: pricing information, photos, videos, which other dealers has the car, the value of their trade-in, info on financing rates and so on.

“So unlike 15 years ago, when a dealer was in a position of power from the negotiation, now the consumer can negotiate a much better deal. That’s inherently a good thing for consumers, but it has crunched dealers’ profit margins over the last 15 years,” he suggests.

During this time, dealers have gotten innovative to improve their margins, Easterly says. For example, they have implemented turn-time as a key metric to move cars faster and utilized inventory management systems.

But there’s something missing.

What Easterly calls the “key issue that hasn’t been addressed yet” is taking that significant “transparent access to inventory” that has been available on the retail consumer side for many years and providing it to dealers on the wholesale side.

“We give dealers visibility to all of the inventory that’s available across dealer lots across America, instead of asking dealers to list cars and to exert effort or money to sell in our marketplace, we make sure that their cars are visible without any effort on their part,” Easterly explained.

“And we allow dealers who have a need — a car that a retail buyer wants or something they need to stock on their lot — to reach out and make an offer to them through a networking tool,” he continued.

“It’s analogous to LinkedIn or Facebook, but specifically for dealers to help them build their trading networks of people they already know and do business with, but now they can see each other’s inventory in real time and they can interact through a platform that helps them make the process faster, smoother and more profitable.”

Later in the conversation, Easterly would make another connection to the retail online classifieds environment.

DealerMatch takes the data available via dealers’ retail vehicle listings to show other dealers what cars are out there.

“Dealers have already invested millions and millions of dollars over the last couple decades making sure their inventory is visible to retail buyers. It’s just part of their operations and a cost of doing business as a dealer in the U.S. today. You’re either on AutoTrader or Cars.com, and most of them, of course, have their own retail front-end website that they spend a lot of time and money making sure is available,” Easterly noted.

“They’ve already invested tons of effort and money in making sure their inventory data is out there,” he said. “What we do is we tap into the existing flow of data and repurpose it to show the wholesale audience — other dealers —  what cars dealers in the U.S. have available.”

On top of that massive amount of inventory data — Easterly said DealerMatch has somewhere in the neighborhood of 800,000 cars on its site at any one time —  are networking tools to help dealers sort through this “huge pot of cars.”

This is where the analogy Easterly made about Facebook and LinkedIn is pertinent.

 “The networking piece of it is very critical in that it allows you, very quickly, to figure out which cars are on the lots of the guys that you already know and have relationships with, which is really important to our users,” he noted. “We have about 500 members, and we spend a lot of time helping them understand that trading within the dealer community is not just about making offers or bids to guys you’ve never met before.

“It’s about leveraging your relationship. Make offers to people you’ve already done business with – and/or to build out your network with new trading partners.”

 “What we really focus on is … you already trade with 10 or 12 other dealers in your area, let’s network you with them so you can see their inventory in real time and source quicker with the folks you’re already trading with.’”

How Connections are Made

Easterly went into further detail as to how dealers get connected. He emphasized that the company is continually learning and evolving with regards to the process, “but it boils down to having transparency and visibility to the marketplace.

“If you can see all the cars, and you can see over time, the VIN numbers that appear and disappear at each individual dealer’s lot — which we have access to — you begin to get a feel for what kind of inventory they’re moving on a regular basis, and what they should be seeking,” Easterly continued. “You can look in their market or an adjacent market and see other guys that have complementary inventory flows.”

Consider the following example.

Dealer A is in Charlotte, and Dealer B is in Atlanta. They don’t know each other. Dealer A has cars that are moving fast. These same cars are slow-moving for Dealer B.

These dealers probably should be doing business together, but simply haven’t connected. Again, this is where DealerMatch aims to build that connection.

“And there’s been a number of instances where we have brokered transactions between dealers; we’ve teed them up — transactions between two different dealers who never knew each other but they were only a few hundred miles apart,” he said.

The two keys here, Easterly noted, are the transparent access to the data and the fact that DealerMatch has people on its team who know the industry. These folks included former buyers for major dealer groups and people who have worked at dealerships or auctions. In other words, folks “who get the art of the industry as well as the science.”

They can help the company understand, “from a relationship basis, who should be introduced to each other,” Easterly added.

“And there are all sorts of flavors of this. Sometimes it aligns around BMW dealers in a region who should be matched together, or sometimes a particular grouping of independent dealers in a certain market who sell different types of inventory. So you can imagine all the different permutations of combinations that you could create, but all that’s really been blocking it, historically, is being able to see it.”

And that introduction he speaks of typically takes place around a car — for instance telling Dealer A that Dealer B has a car that’s hot in Dealer A’s market, but slow in Dealer B’s. Then, the company asks Dealer A if he or she would like to buy that car.

“Usually, once you put together one or two deals, they’re off and running and they begin to transact with one another without any assistance. And that’s really the magic that we’re trying to create.”

And if say you are trading with a dealer you don’t know and you’re a bit anxious about it, to assuage this fear,
DealerMatch offers an optional product for sale called DealShield, which provides 100-percent buy-back guarantee.

Sharing more about creating networks, Easterly noted that it’s currently an open-network building tool, so any dealer can add any other dealer to their network.

And a huge part of the network- and relationship-building on the site is using the filter and search tools that help dealers narrow down the massive amount of available cars and create specific networks of dealers with whom to trade.

Once those networks are established, the user can see the cars on the lots of the dealers in their network. To illustrate how searching on the site works, Easterly walked Auto Remarketing through the process, pulling up a search for Infiniti.

“This is the nuance that you’ve got to understand. This is not an Infiniti search we’re looking at now. This is a search of a network of guys that I buy and sell Infiniti’s with. I may see some Infiniti's in there obviously,  but I’m also going to see the other inventory they have on their lot,” he explained. “This is a relationship search, not an inventory search.

“It’s the combination of the two where the real power is here,” he added.

How Inventory Arrives at DealerMatch

To illustrate in more detail how the inventory actually gets to the site, Easterly explained that the company has partnered with retail sites like AutoTrader.com to include cars on DealerMatch. It also has a relationship with Hertz, through which  they are fed inventory from the Hertz Dealer Direct platform.

Easterly said he was not at liberty to mention the other partners per contract stipulations, but he did say DealerMatch is “looking to partner with more.”

He mentioned that most dealers in the U.S. are using one of the retail sites DealerMatch is partnered with, so most will have inventory on the site automatically.

“Most dealers who don’t know who we are have inventory on DealerMatch. And to make sure that they get offers that they would want to get, what we do with those dealers is only show the cars that have been advertised from their lot for 40 days or more,” he explained. “So theoretically, if it’s aged inventory, they should be open to getting a wholesale offer on what we show. For all our members, we show all of their inventory.”

Editor’s Note: This article appears in the Aug. 15-31 print edition of Auto Remarketing as part of our special look at Multi-Platform Selling. For more coverage of this issue, check out this issue and stay tuned for our digital edition of the magazine, which will include a video demo from DealerMatch.