Picture a coffee table at one of those beach rentals or family vacation homes.

On one side of the table might be travel books, beach-reads and magazines — these are finished products that are signed, sealed and delivered.

On the other side might be a guestbook, where vacationers sign their names and share stories from their respective stays — that would be an evolving product, if you will.

Consider the Dealer Pledge that TrueCar released about a year ago more akin to the latter.

“We see our pledge as a living, breathing action plan that evolves based upon both the continuing work related to those original concerns and improvements based on ongoing feedback we’re getting from dealers,” TrueCar president and chief executive officer Chip Perry said in a late-January interview here just before the NADA Convention & Expo.

Earlier that month, TrueCar had shared several updates to its Dealer Pledge initiative for 2017, following up on the March 2016 overhaul it made in how it conducted business with dealers.

These latest updates are among three focus areas for TrueCar in 2017, Perry said.  The others include upgrading the TrueCar website and starting work to broaden the company’s services beyond its current offerings.

To begin this series, Part I will look at Dealer Pledge Updates.  

Continually evolving pledge

To use a baseball analogy, Perry considers TrueCar to be in the “second inning” in terms of progress made since launching the pledge.

“It’s very early days for us. We’re digging ourselves out of a pretty deep hole of negative perceptions by many dealers across the country,” Perry said. “Our pledge has enabled us to make some significant progress. We’ve seen a lot of dealers give us a second look.”

In fact, during the first nine months of 2016 – including the six months following the late-March launch of the pledge – the number of dealers using TrueCar climbed by more than 2,000, he said.

What’s more, AutoNation is working with TrueCar again after the companies stopped doing business together in 2015.

Still, Perry said TrueCar is not “anywhere close to being done” with working on the pledge. The company has been picking up suggestions and generating feedback from dealers. It has put more muscle in its dealer training, updated pricing tools and more. 

One of the updates to the pledge allows dealers can post their marketing assets and YouTube videos on TrueCar.

Perry pointed out that third-party sites have learned through the year that “in-market car shoppers are information seekers.” When a car shopper is just about to make a purchase, he or she tends to be a “sponge,” soaking up all the information they can on the vehicle they are considering or competitive rides.

 “And that’s why, just before buying a car, consumers will bang on the door of a dealer’s website pretty hard and hit the car they’re interested in multiple times,” Perry said. “Third parties can also see that when consumers are very close to buying a car, there’s intense use and intense interest.

“And that is expressed through multiple views of the same car. People come back and back and back. And so, at that very moment, rich video content is of high interest,” he said.

“All the third parties over the years have seen significant click-through rates from video when its presented to close-to-purchase, in-market consumers. So, this is low-hanging fruit and we want to be able to help the dealers capture that low-hanging fruit by presenting video about their vehicles and about their dealership through TrueCar,” Perry said.

“This is not revolutionary, but it’s an important incremental improvement in our business.”

Dealer training upgrades 

Another one of the pledge’s goals was to boost the level of service TrueCar provided dealers. The company studied why certain dealers had higher close rates on leads from TrueCar. After research into what those dealers did differently, TrueCar put together an initial roadmap based on 10 habits successful dealers were incorporating, which is now the foundation of its training.

That, however, was just the first step, Perry said; you can expect more improvement this year.

 “In parallel with the in-store intensive service we’re providing, we wanted to create public forums to provide this training and to hear dealer feedback,” Perry said.

Hence, the Dealer Summits. TrueCar hosted six of these in 2016 and has plans for at least six in 2017.  

Perry said he will be at as many as possible.

“Our job there is to explain in very common sense ways the changes we’re making, the improvements we’re trying to build into our business to benefit dealers and also provide a public outlet for anybody to say anything,” he said. “And it’s always interesting what comes up.”

For instance, some dealers have expressed a need for further improvement to trim down “the race-to-the-bottom effect,” Perry said.

“And they have practical ideas for that. And so we’re very attuned and based on their input we have further changes planned in that area this year,” he said.

The billing model has also come up before. For instance, one dealer asked why TrueCar was billing the store for sales to consumers who were buying a second car or were using TrueCar in the store when they were buying from dealer.

“And it gave me an opportunity to explain (that) we actually changed that,” Perry said. “We no longer bill you for transactions that come from a consumer showrooming you, meaning using TrueCar for the first time in your store and becoming a lead that day, in that very moment.

“The fact that we made that kind of change wasn’t known to everybody. And so I’ve learned that it takes a while for improvements to sink in and become understood. So, it’s very helpful when dealers help us realize that we need to more strongly communicate what we’ve already done. That just highlights how long the road we have to go is.”

This reinforces the notion that the pledge is designed to be a “journey,” and one that further balances the marketplace to benefit both dealers and consumers.

“Many dealers’ perceptions are based upon what TrueCar looked like last year or two years ago,” Perry said. “We’ve tried to make some leaps-and-bounds types of improvements in the past year and we’re working hard to help dealers understand them, continue to listen and make even more improvements based on their ongoing feedback.”

The summits also bring in folks from outside the company to offer additional points-of-view.

VIN-based pricing

TrueCar made improvements in dealers’ ability to present VIN-based offers last year and the company plan to “drive that home even stronger” this year, Perry said.

He also explained why VIN-based pricing is so important for dealers.  

“As we’ve studied performance of dealers and the behavior of consumers, we’ve observed a very strong correlation between dealer close rates and their ability to present actual VIN-based pricing offers to consumers through our site,” he said. “The more VIN-based offers presented at the dealer level, the more closed sales we observe. And it makes complete common sense that people want more than a virtual certificate.

“They have configured a car. They are seriously interested in buying that car and we help them see an upfront pricing offer from a dealer, presented in the context of what other people paid, so they can see that the dealer’s price is, indeed, market correct. It motivates the consumer to want to go visit that dealer and get the deal done,” he said.

“That experience of being able to view real, live, upfront pricing in the context of what other people paid is not generally available on third-party sites and it’s not available on dealer websites. So that’s why consumers are very much attracted to TrueCar. The devil is in the details of how well we do that.”

Stay tuned to Part II of this series for more updates from TrueCar.