Today’s installment of the Q&A series from the recent Power 300 issue of Auto Remarketing features Jared Rowe, the president of Autotrader. In this story, Rowe covers everything from certified pre-owned opportunities to facilitating quicker F&I processes and the consumer experience.

Auto Remarketing: You’ve said in the past that although good work is being made toward adapting old sales processes, consumers say changes aren’t being made quickly enough. What do you see as the key area that some dealers are having a hard time changing and adapting to that would, in your opinion, make the biggest impact on consumer satisfaction?

Jared Rowe: Great salespeople and great experiences both trump lowest price when consumers are selecting a dealership to buy from, and one of the greatest areas of opportunity is to improve consumers’ perception around the amount — and the value — of the time that they spend at the dealership. From our research, we know that buyer satisfaction with the dealership begins dropping after 90 minutes in store on the day of purchase.

By focusing on the parts of the process that contribute to purchase-day delays and dissatisfaction, particularly around the finance and trade-in, dealers can significantly increase consumer satisfaction, which will have a positive effect on dealership and brand loyalty. Both of these areas are evolving in really interesting and positive ways.

The F&I process alone accounts for an average of 61 minutes on the day of purchase — more than two-thirds of the ideal time consumers are satisfied spending at the dealership. The great thing about this area of opportunity is that there are more tools available than ever before to accomplish what we need to as an industry and also meet the ever-increasing expectations of the consumers.

AR: CPO sales set a quarterly record at the end of June. When you spoke at the 2015 Digital Summit in February, you focused heavily on the CPO market and said “that’s a lever we haven’t fully pulled” — what have you seen in recent months that dealers are doing differently to increase CPO sales, and what sorts of benefits are they reaping because of it?

JR: A large influx of CPO-eligible vehicles that have come off lease recently, and that trend will only amplify, with around 9 million certifiable cars coming into the market over the next three years. We have also seen CPO inventory levels rise significantly on Autotrader, with an increase of 12 percent from 2014 to 2015.

Dealers realize that CPO vehicles offer an opportunity for better revenue, and more satisfied customers, so they are putting more focus on promoting CPO vehicles. But as the Autotrader CPO Study found, educating consumers about CPO is key to increasing their consideration and likelihood to purchase CPO.

Autotrader’s 2014 CPO study showed that familiarity with CPO is still low, as less than half of used-car shoppers report being familiar with the option. However, once exposed to a comprehensive definition, 69 percent of used-car shoppers said they would consider purchasing a CPO vehicle. These shoppers ascribed a significant economic value to the benefits — at around $2,000 — with peace-of-mind being the top reason to purchase a CPO vehicle.

This all goes to show that if dealers can help close the knowledge gap on CPO, they can reap major benefits, as the study also showed that people who purchase CPO are highly satisfied and more loyal to both the dealership and the brand. Eighty-five percent of CPO owners are likely to buy from the same dealership for their next purchase, and 77 percent of owners are likely to buy the same brand again (49 percent are likely to be a new vehicle from the same brand).

AR: The 2015 Automotive Buyer Influence Study released by Autotrader put a heavy emphasis on creating a dynamic experience for mobile and non-mobile users — what do you see as the key difference in marketing effectively specifically to someone using a mobile device as opposed to someone utilizing more traditional forms of media?

JR: The use of mobile devices for car shopping has been growing exponentially, and Autotrader’s projection is that by 2020, 80 percent of car shoppers will use multiple devices to shop for vehicles. But the key phrase in that projection is “multiple devices.” Right now, we see a very small percentage of car shoppers using mobile only, so dealers should not think about marketing platforms in silos.

The most successful strategies are those led by cross-platform thinking — where there is consistency in messaging, price and branding. Consumers spend just under 17 hours shopping for vehicles, with 75 percent of that time online — and 42 percent use multiple devices. They visit 9.3 sites (up from 8.8 a year ago). What they’re doing is triangulating information and narrowing their selection — not just of vehicles, but of dealers they want to buy from. The more consistency and reinforcement that dealers provide online across all of the platforms consumers use, the better their chances are of influencing those shoppers.

AR: Looking forward, what do you see as the biggest challenge for your company, and what is its primary focus to maintain and/or grow its influence on the automotive industry?

JR: Autotrader is in the midst of an exciting strategic pivot that will further differentiate us from the competition. Our primary focus right now is on evolving into an integrated marketing solution provider that is focused on matchmaking the right buyers with the right sellers.

As more dealers use advanced tools to focus on price to market and scarcity when acquiring inventory and pricing vehicles for sale, we’ve seen the difference between asking and selling prices narrow.

With that, we have seen more dealers focus on differentiating themselves in other ways — through their unique value propositions and the experiences they will offer consumers. Autotrader’s Car Buyer of the Future study showed that 54 percent of consumers would buy from a dealer that offered their preferred experience, even if it didn’t have lowest price.

So by enabling dealers to better communicate their unique value, we can help them build value in the experience and relationship that is connected with doing business with them.

One way we’re doing that is by more fully integrating Haystak into Autotrader’s digital solutions portfolio, which will help dealers more effectively target the “right” consumers and provide them with the “right” message by means of an enhanced search engine marketing product.

Sixty-seven percent of all consumers visit Autotrader and KBB.com each month, which gives us unique insight into where they are in the shopping process. By leveraging this knowledge, along with our unique perspective on scarcity and price-to-market through the combined insights of vAuto and Haystak, we can help dealers do more than just push sales volume. We can also help support their inventory turn preferences while enabling them to put their best foot forward to shoppers.

Other features in this special section include:
4 questions with NextGear’s Brian Geitner
4 questions with NADA Used Car Guide's Larry Dixon
4 questions with Infiniti CPO manager Sam Liang
4 questions with Black Book’s Anil Goyal

Stay tuned to Auto Remarketing Today for more.