Why auto dealers and manufacturers are spending more time and money online
Ford and Lincoln Mercury dealers who once saw the Internet as a threat to their business now see the web in a different light and regard it as an effective retailing channel for driving more car sales, Steve St. Andre, president and COO, FordDirect, told attendees Wednesday at the Internet Retailer Conference & Exhibition in Chicago.
But auto dealers and manufacturers still need to do a better job of using the web to identify customers and their buying preferences earlier in the sales cycle. St. Andre says. When FordDirect was formed about five years ago many dealers saw the organization as a means by which Ford would bypass the dealer, sell direct to the public or use as means to own and operate factory stores.
But today FordDirect, which accounted for about 9% of all Ford car and truck sales in 2004, has more than 3,900 participating Ford and Lincoln Mercury dealers. The dealers, which make up FordDirect, a joint-venture Internet marketing cooperative, own about 80% of the voting rights.
St. Andre said Ford looked early on at using the web to sell direct to the public but later abandoned the concept because of the complexity of new car sales and other issues. Today, FordDirect, dealers and other original equipment manufacturers and third-party sites have done a good job in building web sites that give online shoppers copious amounts of information. “The original content data bases came from engineering specifications,” St. Andre said.
The industry is also shifting more of its marketing and advertising dollars from traditional newspaper listings and circulars to more interactive programs, particularly integrated campaigns that use television advertising to drive traffic to a manufacturer’s web site, which in turn can capture specific leads for dealers. Compared to the industry average of $577 to acquire a sales lead, the web lowers that cost to about $100, he said. “The advertising spending trend is shifting and car shoppers are looking for more options on the web,” St. Andre said. “They are becoming more savvy.”
While the web is becoming a more effective sales channel for Ford, participating brand dealers and other manufacturers, the industry needs to do a better job of using the web to understand customer behavior and acquisition, St. Andre said.
Another priority is using web-based technology to eliminate separate “information silos” and deliver more consolidated lead generation data that helps Ford and its dealers understand buyer behavior and close more sales.
A priority at FordDirect is aggregating sales and customer contact data from more than 19 sources, including various Ford Internet sites and call centers, into one data repository, then delivering leads in a more timely and meaningful way to dealers. “We will become smarter about how we will collect and analyze lead generation information going forward,” St. Andre says. “We need to look at customers and how they want to shop.”
Back...
