In making a presentation about how AutoTrader.com fits into the large world of online marketing, chief executive officer Chip Perry also revealed how much revenue the site expects to generate this year.
A figure that would surpass its previous high by a wide margin, Perry projected AutoTrader.com’s 2011 revenue to be $1.037 billion. Last year, the site posted its highest figure ever since forming back in 1999. AutoTrader.com’s 2010 revenue was $720 million, up from $626 million in 2009.
And for reference, Perry divulged AutoTrader.com’s revenue during its first year — $5 million.
So how does AutoTrader.com believe it will pass $1 billion in revenue this year? Perry discussed six important steps:
—Careful strategic positioning given the realities of the automotive industry.
—Strong vertically specialized marketplace that provides good customer value and sustainable competitive advantages.
—Effective business model that includes multiple revenue streams and creates incentives for advertisers to increase their spending.
—Willingness to price well under traditional media and provide research-based value validation to foster advertiser adoption.
—Major investments in brand advertising and 800-plus sales force.
—Innovation around “unmet needs” in the online auto space.
Perry shared all of this information during a presentation titled, “Getting to the First $1 Billion.” He was one of the featured speakers last week during the Local Online Advertising Conference hosted by Borrell Associates in New York.
The AutoTrader.com CEO previously has been involved in similar events. Last fall in Raleigh, N.C., Perry served as a primary speaker during the Internet Summit, another nationwide gathering of online marketers and executives.
Similar to what he did in North Carolina, Perry told the gathering in New York how AutoTrader.com connects dealers and vehicle shoppers in ways geared to be productive both for the seller and buyer.
AutoTrader.com’s objective for surpassing $1 billion in revenue comes after a year of immense activity. During the last two quarters of 2010, the company made a flurry of acquisitions.
In September, the site announced the purchase of vAuto, a provider of advanced software tools for used vehicle management, pricing and inventory optimization. Then a month later, AutoTrader.com revealed its acquisition of Kelley Blue Book. Before the year closed out, the company secured the assets of HomeNet Automotive, a decision described as benefit to dealers who list their inventory on AutoTrader.com.