When a seller has more precise pricing with a higher degree of accuracy for the actual 17-digit VIN for the car that’s being remarketed at a point in time, the odds of the seller getting the most money for that car increase.
That’s one of several benefits that DRIVIN vice president of commercial solutions Terrence Wynne sees in KAR Auction Services’ new DRIVIN-powered Pricing Insights. KAR describes the product as “a robust, data-driven solution.”
With the product, commercial consignors can use optimized pricing to “maximize the net economics of their portfolios,” according to KAR, which acquired DRIVIN in 2017.
The newest product in the DRIVIN Insights product suite of portfolio management solutions, Pricing Insights uses proprietary, state-of-the-art data science algorithms that create predictive models that determine VIN-level market channel and pricing, according to KAR. The company said the analytics and valuations are uniquely tailored and can help consignors achieve targeted conversion rates and remarketing financial objectives. And KAR says the company can achieve those objectives whether the primary goal is to increase upstream conversion, increase overall net economics or both.
KAR says Pricing Insights’ proprietary, data-driven model includes various input variables that go beyond the variables of traditional pricing approaches. Those variables are unique to the KAR ecosystem, with the company saying they generate pricing models that are tailored to each consignor’s unique remarketing goals.
The application programming interface-driven technology is fully integrated with private-label platforms and other third-party marketplaces. According to the company, that provides seamless, robust and real-time analytics in a single workflow. It also minimizes manual assays and opportunities for error. The technology provides daily views, which allows consignors to understand real-time performance, impact and results.
The company said the new Pricing Insights product uses data across KAR’s ecosystem. It integrates the data with DRIVIN analytics and modeling. The product moves beyond traditional algorithms that are grounded in broad assumptions, according to the company.
According to KAR, the product is dynamic and customizable for each consignor brand. That customization means it aligns the technology with the strategic objectives of each customer. The product adjusts as remarketing priorities change, and KAR says it can quickly change as objectives evolve.
Each consignor is paired with dedicated DRIVIN resources, serving as an adviser that monitors and adapts for effective pricing recommendations.
“Pricing Insights enables customers to benefit from Big Data at an industry-leading level,” Wynne said in a news release. “The customizable analytics and precise valuations of Pricing Insights deliver the returns our consignors are looking for.”
These new DaaS capabilities are powered by DRIVIN, and by using data and technology from across the KAR platform and also by using proprietary algorithms, they deliver actionable intelligence to customers, according to the company
“Pricing Insights has achieved proven results for a number of our commercial consignors,” said Don Gottwald, president of KAR digital, data and mobility solutions. “By customizing the solution for each consignor and its brands, we have achieved a $170 per-unit net economic gain overall — potentially creating more than $86 million in annualized value for those customers.”
The second benefit that Wynne sees with Pricing Insights is the way the company designed the tool to understand how pricing impacts the saleability of a vehicle.
“So we understand if we move price up or down, by certain incremental movements, we can expect to either sell more … if we lower the price, or fewer cars if we increase the price, based on what our customer is trying to achieve,” Wynne said in a phone interview last week. “It allows price to be a strategic lever, not just sort of a fixed price, set it and forget it.”
Wynne sees the third benefit or value of Pricing Insights in terms of the digital nature of the product.
“Everything we build at DRIVIN is API driven,” he said.
That means DRIVIN can integrate directly with a private label site or integrate directly to an in-lane provider, he said.
“And we can deliver on price directly to the platform in sort of real-time fashion, in milliseconds,” he said.
“That reduces the human workload for our customer in terms of generating prices for a list of vehicles, that reduces the workload associated with delivery of those prices to the platform and also eliminates a lot of the opportunity there for human error or process error or procedural error,” he said. “So I think those are the three … big benefits or the value we’re adding with the solution.”
He said that the company wants its customers to be able to enter what he called the “KAR ecosystem” and have a seamless experience. That means the users don’t have to go to one spot to sell their car online, for example, and then have to go to a completely different spot to sell their car in lane and then have to go to a completely different spot or vendor to get a second key cut for the car, he said.
“We want that customer to be able to come in, have all of those products and services available in a digital manner, and they can come in, zero friction … get everything they need from vehicle acquisition to all the ancillary support services we offer to either sell the vehicle they need to sell or acquire the vehicle they need to sell so that … our customers and the buyers can get to the real business of ultimately retailing those cars back out to customers.”