Given the amount of car research, browsing and shopping that is done online before a potential car buyer even arrives at your store, a new twist to mastering certified pre-owned sales is to reach those shoppers on the Web.
As part of our annual “Best CPO Dealers in the United States” special edition this winter, Auto Remarketing asked a few of Volkswagen’s top certified dealers for some of their more effective techniques to engage with CPO shoppers online.
Starting off with Luther West Side Volkswagen — VW’s No. 1 ranked CPO seller in 2014 with 1,345 sales — general manager Steve Hendricks had this to say.
“Here is how we engage the CPO guest: One, we have great photos showing the unique aspects of the cars; for example, if we have brand new tires installed with picture those up close, if the vehicle has heated seats, we show them in the ‘on’ position. If the car has navigation, we show the navigation screen with the map of our location on the screen. Back-up camera, too, we show a shot of it in action,” he said.
“Two, we make sure we have great comments on every vehicle, not ‘canned’ comments like ‘Clean’ or ‘Extra Clean,’ but some real info on each car,” Hendricks added.
He gave a few examples of such comments:
- ‘Perfect CARFAX history’
- ‘Maintenance Records from New’
- ‘Fully inspected and serviced to very strict VW Certified Standards’
- ‘As close to new as you will find!’
- ‘You will love the great care this one owner car has had since new’
- ‘You will absolutely love the way this one rides, drives and handles, as well as its great looks!’
Continuing on with the third item on the list, Hendricks added: “Three, we also state the main aspects of the VW Certified Warranty in every description. These three items, if done on every CPO car, will generate interest to the online guest to contact us.
“Every vehicle has to have each of these three points, no exceptions,” he continued. “We sold over 1,300 CPO VWs last year, far outpacing the rest of the VW stores, and this is one way of how we do it.”
Next up, Steve Meadows of Gunther Volkswagen Coconut Creek, explained what his store (ranked second on VW’s 2014 list with 997 CPO sales) does to engage with CPO shoppers online.
“Here at Gunther, we clearly distinguish are CPO cars with the World Auto banner and a two-year/24,000-mile warranty. We consistently monitor our prices to ensure they are the best in the digital marketplace,” Meadows said. “We also provide all recommended maintenance, interior and exterior reconditioning in order to provide our CPO cars a like new appearance in all our photos.”
At Volkswagen Santa Monica — VW’s third-ranked certified dealer with 853 sales last year — pre-owned manager Dan Nguyen listed four points of advice.
First, include “15 or more photos of vehicle in a nice display area,” Nguyen said.
“Therefore, the customer does not have to leave the comfort of his or her own home to shop for a vehicle; the dealership with the most photos and a detail comment will most likely sell the car,” he added.
Nguyen also emphasized the importance of having a website that can be easily navigated by the consumer, making it simple for the shopper to find the car.
Next, he said that the “vehicle needs to be price at market value, not over-inflated.”
Finally, Nguyen recommends you include “an easy explanation of the CPO warranty and process that led up to a car being certified.”
Staff Writer Josh Hyatt contributed to this report.
Arguably one of the more important keys to selling certified pre-owned is making customers take notice. In other words, how you convey what makes CPO vehicles different and desirable.
So, as part of our annual “Best CPO Dealers in the United States” special edition this winter, Auto Remarketing asked Matt Ryan, general manager of Niello MINI in Sacramento, Calif. — one of the brand’s top 10 CPO sellers in 2014 — how he makes the certified pre-owned offering stand out at his dealership.
Ryan shared these five points to recap how his store distinguishes vehicles in the MINI NEXT certified pre-owned program, as listed below:
- Sales and service advisers heavily focused on the MINI Next program and discuss the program benefits with our customers, both online and in-dealership.
- Concentrated digital advertising effort on our NEXT inventory
- Every vehicle in NEXT inventory is photographed on our website with extensive details on the story of that particular vehicle.
- We feature weekly/monthly specials on specific NEXT units
- General commitment to the most comprehensive certified coverage in the industry
Of course, one of the more distinguishing aspects of the certified market is the fact that it provides a used vehicle option with a “like-new” experience. As part of this same feature, we reached out to Wentworth Subaru, the brand’s top-selling CPO dealership in 2014 with 611 sales, and asked how that store provides a like-new experience for Subaru CPO customers.
“Whether you are purchasing a new Subaru or a Subaru CPO at Wentworth Subaru, customers receive the same quality level of service. It’s a ‘new’ vehicle to our customer, and we want them to enjoy the buying experience and leave the dealership happy,” said Bob Tewell of Wentworth Subaru and Wentworth Chevrolet.
Staff Writer Sarah Rubenoff contributed to this report.
Asian-brand dealerships sold more than 99,000 certified pre-owned vehicles in April for nearly a 9-percent year-over-year increase.
And European-brand dealers increased their CPO sales nearly 10 percent with more than 37,000 units moved for the month, according to Autodata Corp.
More specifically, there were 99,046 CPO sales from Asian brands in April, Autodata said, which was an 8.8-percent increase from April 2014. Through four months, they moved 374,693 certified units (up 6.2 percent).
European brands moved 37,057 certified vehicles for the month (up 9.6 percent year-over-year). In the first four months of the year, they moved 142,525 CPO vehicles, up 11.6 percent from last year’s pace.
Autodata noted that two European brands achieved best-ever certified sales during April: Land Rover, which had 1,201 sales for the month (up 12.3 percent); and Porsche, with 1,209 CPO sales (up 18.6 percent).
Domestic-brand dealers increased their April certified pre-owned sales by more than 15 percent, pushing their year-to-date total above 300,000 units, according to Autodata Corp.
The Big 3 sold a collective 78,864 CPO units for the month, beating April 2014 figures by 15.5 percent, Autodata noted.
Through four months, domestic certified sales reached 312,763 units for an 18.3-percent hike.
Over at Ford, its brands combined to move 24,777 certified vehicles in April, which marked a 13.1-percent increase. Sales through four months were at 93,431 units (up 8.9 percent year-over-year).
Certified sales for the Buick, Chevrolet, GMC, Pontiac and Saturn brands at General Motors reached 36,666 units for the month (up 10.9-percent) with yearly sales hitting 152,599 units (up 21.5 percent), Autodata indicated.
Cadillac dealers moved 2,402 CPO vehicles (up 28.3 percent) in April, with year-to-date sales at 8,666 units (up 29.2 percent).
There was a combined 15,019 Chrysler, Dodge, Jeep and Ram CPO sales in April (up 31.7 percent). Year-to-date sales were at 58,067 units (up 25.6 percent).
CPO sales for Fiat (which are not included in the aforementioned totals) were at 81 units in April (up 170 percent) and 272 for the year (up 112.5 percent).
In light of Auction Direct USA entering the certified pre-owned market through a partnership with NIADA, one of the questions that chief executive officer Todd Hoagey acknowledged people might have is this: why does the company need a CPO program?
Speaking last week at the partnership’s kick-off event at the Auction Direct store in Raleigh, N.C., Hoagey said the answer is two-fold.
For one, he said, going CPO is about meeting consumer demand in the market. However, “more importantly, it’s the right thing to do,” Hoagey added.
Customers, he said, are looking for an extra layer of assurance through certified vehicles. Not to mention, CPO actually gives them more options in terms of vehicle choice.
Certified pre-owned, Hoagey said, is “customer-centric.”
The event in Raleigh followed an April 27 announcement that Auction Direct had partnered with the National Independent Automobile Dealers Association to offer NIADA Certified Pre-Owned vehicles at its stores.
NIADA executive vice president Steve Jordan talked with Auto Remarketing about the demand for CPO, particularity as it relates to third-party providers like NIADA.
“With our program and certainly with (CarMark Certified Pre-Owned), I think it serves a unique niche in the marketplace, where independent dealers can have a product that is an answer to a franchised product, or an OEM product,” Jordan said.
“And certainly even franchised dealers now have an opportunity to sell an off-brand CPO. If I’m a Toyota or a Honda dealer, I’ve obviously got those CPO programs, but if I’ve got five Ford Explorers on my lot and people are wanting to buy a CPO unit, this would give them an opportunity to certify an off-brand vehicle.”
In terms of branding its own CPO program, NIADA is looking to emphasize “satisfaction and service after the sale,” so that the independent dealer’s consumer has peace-of-mind after the sale.
“When you buy a car from a used-car dealer, one of the biggest concerns and thoughts that they have is, well, what happens when it breaks down?” Jordan said. “This helps us answer that question.”
Auto Remarketing has learned that Volvo has new leader for its certified pre-owned program to replace Steve Golow, who is now aftersales operations manager for the Southern region at Volvo Cars of North America.
Now serving as the national pre-owned manager for Volvo Cars North America is Robert Zilinski, who came over to the company after leading Mercedes-Benz’s CPO operations.
Zilinski’s title is now national pre-owned car line manager for Volvo Cars North America.
Volvo and its top-selling CPO dealers were featured in Auto Remarketing’s "Best CPO Dealers in the United States” this winter, among other OEMs.
Despite a slowdown from March, certified pre-owned sales in April beat year-ago figures by more than 11 percent, and two brands posted their best-ever months.
According to Autodata Corp., there were 214,967 certified sales last month, an 11.3-percent increase from April 2014 and a 3.4-percent decline from March.
Through four months of 2015, the industry has sold 829,981 certified vehicles, beating last year’s pace by 11.4 percent.
Enjoying record-high CPO sales were Land Rover, which sold 1,201 units in April (up 12.3 percent year-over-year), and Porsche, which moved 1,209 certified vehicles (up 18.6 percent), Autodata reported. Through four months, Land Rover has sold 4,345 CPO vehicles (up 15.9 percent), and Porsche has sold 4,240 (up 15.7 percent).
The daily selling rate for CPO sales in April was 8,268, up from 7,427 in the same month of 2014.
After first announcing the plan to launch a certified pre-owned program for the Model S last fall, Tesla has officially launched the offering online.
Auto Remarketing confirmed with a Tesla spokesperson that the Model S pre-owned website launched this past Friday.
The website, whose launch was first reported by Clean Technica, features the CPO warranty, front-and-center.
According to the site, every pre-owned Model S comes with a four-year, 50,000 mile limited warranty.
Every pre-owned Model S also receives a full inspection, remaining battery and drive warranty, and 24-hour roadside assistance.
Car shoppers have the ability to search by market area and color. They can also specify which type of Model S they are in the market for, choices which include the 60 kilowatt-hour, 85 kilowatt-hour, and the 85 kilowatt-hour performance Model S.
Model years includes 2012, the EVs debut year, plus 2013 and 2014 models, as well.
Though prices vary across the site, on the lower end is a 2013 60 kilowatt-hour Model S with 24,558 miles, going for $55,000 in the Atlanta market.
On the other hand, an 85 kilowatt-hour Performance Model S with 19,894 miles is going for $91,500 in the San Francisco Bay area.
Underneath the bright red “buy” button for each model is a disclaimer noting the requirement of a $1,000 deposit.
Auto Remarketing followed the Tesla CPO announcement closely this past fall, taking an in-depth look at the questions of pricing and sourcing.
And though electric vehicle residuals remain soft overall, Tesla’s lack of competition and niche audience are keeping used prices strong for the automaker — a statistic that bodes well for the company’s new CPO offering.
According to NADA data, used value retention for the 2012 Model S with the 86 kilowatt-hour battery stood at about 57-percent retention earlier this month.
In comparison, retention for the 2012 versions of the Chevy Volt and Nissan Leaf were at around 35 percent and 27 percent, respectively, according to NADA data.
And NADA Used Car Guide’s latest Perspective report asserted electric vehicles may be a good choice for certified programs such as Tesla’s, which ramp up and lengthen initial factory warranties.
The report explained many three-year-old EVs are nearing the point where they are no longer covered by their respective manufacturer’s basic warranty due to age or mileage accrual.
“This is a potential concern since an extra layer of risk is being added into the mix when used EV buyers are shopping for vehicles,” NADA UCG analysts explained. “As mentioned previously, technology concerns are one of the biggest drawbacks for prospective EV buyers, and the lack of warranty coverage will undoubtedly increase this hindrance further and erode prices on out-of-warranty vehicles accordingly.”
Consequently, NADA UCG asserted CPO programs are a “logical fit” for used EVs, as extended warranty features may prove attractive to shoppers conference about the reliability of new technology.
There’s one thing in particular that Will Amiri notices about buyers of certified pre-owned vehicles that may make them different than most used-car buyers.
As part of our annual “Best CPO Dealers in the United States” special edition this winter, Auto Remarketing asked Amiri — the used-car director of Longo Toyota & Lexus — what he considered to be some of the biggest differences he has seen between CPO customers and other types of shoppers.
“The biggest difference I find with CPO buyers is that there is a much higher level of trust in the car. The salesmen don’t have to overcome some of the typical objections you normally get with used cars, so the sales process is much closer to that of a new car,” said Amiri, whose Toyota store ranked No. 3 on the brand’s list of top 2014 CPO sellers with 2,883 units sold.
“The quality/reliability of the car is taken out of the equation, so the focus goes back to having the right car/color at the right price, like new cars,” he added.
What else do these shoppers value? For some, it may be the value proposition of the car itself.
Also as part of that feature this winter, we asked Rich Matthews, the president of Red Bank Volvo, how his store — Volvo’s No. 7 CPO seller last year with 218 sales — presents the value of a certified car.
“We sell the value of the following touch points that start on the Web listing, including: A better shopping experience, because the customer knows what they’ll be getting from the beginning; no added hassle of purchasing extended warranties at time of sale; access to more competitive interest rates; and nationwide manufacturer warranty that offers no hassle coverage,” Matthews said.
For more insight from top-selling CPO store, see our Best CPO Dealers issue. Staff Writers Josh Hyatt and Nick Zulovich contributed to this report.
Auction Direct USA is jumping into the certified pre-owned space.
It was announced Monday that Auction Direct USA, which is one of the largest independent used-car retailers in the U.S., has partnered with the National Independent Automobile Dealers Association and will be offering NIADA Certified Pre-Owned vehicles at its stores.
“We couldn’t be more excited to begin this partnership with NIADA to offer CPO vehicles in our existing markets,” Auction Direct USA chief executive officer Todd Hoagey said. “Auction Direct USA is very proud to be affiliated with NIADA, an organization committed to helping used-car dealers provide the best possible buying experiences to customers all across the country. We will represent them and their vision very well.”
NIADA Certified vehicles are required to pass a 125-point inspection. Among the benefits they include are the following, as listed in Monday’s news release:
• A worry-free six-month/6,000-mile limited warranty
• A Carfax vehicle history report
• Special financing for qualified customers
• Flexible, fully customizable warranty options
• Free vehicle maintenance
Consumers can also receive an exclusive 100-day/1,000-mile return option from Auction Direct USA.
NIADA executive vice president Steve Jordan called AuctionDirect USA a top-performing dealer member of the association that is “committed to providing top-quality products and a buying process that is second to none.”
Jordan added: “Their integration of NIADA’s Certified Pre-Owned program is another example of how innovative thinking is creating a winning experience for Auction Direct customers and their commitment to upholding the NIADA Code of Ethics.”
