J.D. Power and Associates Reports: AutoTrader.com and Dealix Rank Highest in Satisfying Dealers With Online Vehicle Buying Services
Only 33 Percent of Dealers Pay for Search Engine Marketing to Optimize Their Web Site Visibility
WESTLAKE VILLAGE, Calif., Sept. 12 -- Dealix ranks highest in satisfying dealers with new-vehicle lead services, and AutoTrader.com ranks highest in used-vehicle lead services, according to the J.D. Power and Associates 2006 Dealer Satisfaction with Online Buying Services Study(SM) released today.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050527/LAF028LOGO-a )
The study, which measures dealer satisfaction with online buying services, ranks vehicle lead services in two segments: independent new vehicle and independent used vehicle. Within those segments, five factors are measured to determine overall dealership satisfaction: business generation, dealer support/service, fees, transmission of leads and advertising, which is not included in the independent new lead service segment. The business generation factor is the most important driver of dealer satisfaction in all of the segments, accounting for nearly one-half of the overall index score. AutoTrader.com and Dealix both received the highest ratings from dealers in this factor within their respective segments.
"The largest benefit to a good performance in the business generation factor is that price becomes less of an issue to dealers that subscribe to online buying services," said Min Cho, senior analyst of digital marketing solutions at J.D. Power and Associates. "Good online buying services can charge more for their leads as long as they deliver on other measures. Satisfying dealers is not just about the fees per lead -- it's more about the cost associated with the vehicle sale and the overall value."
The study finds that online buying services can help dealers be more successful with closing leads they receive through their Web sites by providing more information about the customer to the dealer. When customers shop for vehicles on the Internet, online buying sites will generally match them up with the right vehicle, demonstrate that the vehicle is right for them, and then transfer the shopper to the dealership where the deal is closed. However, when the customer is transferred to the dealership, the salesperson generally knows little or nothing about the customer's overall shopping experience and the shopper may know little or nothing about the dealership.
"Customers, on average, spend five hours researching vehicle models, features and options online," said Cho. "This is valuable information for dealers as it helps them to more effectively tailor their sales presentation to meet the needs and wants of the customer. However, online buying services generally do not keep track of this information, so the customer ends up starting from scratch again once they are connected with the salesperson. The more information a salesperson has about the customer, the easier it will be for the salesperson to close the deal."
Additionally, training on how to handle leads through the online service site is a critical component in dealer success. Dealers who receive training generally experience higher closing ratios for leads and report higher satisfaction with the service than those who do not.
Search Engine Marketing
Another way for dealers to generate quality leads is through the use of search engine marketing (SEM), which enhances dealer Web site visibility by using one of two marketing methods: search engine optimization and paid/sponsored clicks. Currently, 75 percent of dealers who use SEM subscribe to search engine optimization, which improves search rankings without having to pay for clicks (also known as organic searches). Additionally, 57 percent of dealers who subscribe to SEM use paid/sponsorship clicks (Google, Yahoo!, MSN). While only 33 percent of dealers currently use search engine marketing, more than 80 percent of those dealers believe it improves Web site visitation, as it takes vehicle shoppers directly to the dealer Web site as opposed to shopping through an online buying service. Visitation to dealer Web sites has the added benefit of increasing visibility of the service and parts department to potential buyers.
"Dealers are starting to recognize just how important and valuable their Web site is, especially considering that the best leads dealers receive often originate from their site," said Cho. "In the 2006 Used Autoshopper.com Study, we found that the percentage of buyers who located their vehicle online has doubled in the past five years. Having a presence on the Internet by subscribing to online buying services and using search engine marketing methods is increasingly important in connecting with vehicle shoppers as more traditional advertising methods decline in popularity."
The 2006 Dealer Satisfaction with Online Buying Services Study is based on 1,010 dealer evaluations of the online buying services they use.
Customer Satisfaction Index Scores: New-Lead Service Segment (Based on a 1,000-point scale) Dealix 668 New-Lead Services Segment Average 592 AutoUSA 574 Autobytel.com 570
Included in the study but not ranked due to small sample are: AutoTrader.com, Autoweb.com, Car.com, cars.com, CarsDirect, eBay Motors and Vehix.com.
Customer Satisfaction Index Scores: Used-Lead Services Segment (Based on a 1,000-point scale) AutoTrader.com 662 cars.com 626 Used-Lead Services Segment Average 604 Autobytel.com 568 eBay Motors 556
Included in the study but not ranked due to small sample size are: AutoExtra.com, AutoMart.com, Car.com, CarsDirect, SAM'S CLUB Auto Buying Program and Vehix.com.
NOTE: The study also measures dealer satisfaction with manufacturer and member lead services, however, rankings are unavailable due to small or insufficient sample sizes.
About J.D. Power and Associates
Headquartered in Westlake Village, California, J.D. Power and Associates is an ISO 9001-registered global marketing information services firm operating in key business sectors including market research, forecasting, consulting, training and customer satisfaction. The firm's quality and satisfaction measurements are based on responses from millions of consumers annually. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.
About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands such as Standard & Poor's, McGraw-Hill Education, BusinessWeek and J.D. Power and Associates. The Corporation has more than 290 offices in 38 countries. Sales in 2005 were $6.0 billion. Additional information is available at http://www.mcgraw-hill.com/.
J.D. Power and Associates Media Relations Contacts: John Tews Syvetril Perryman Troy, Mich. Westlake Village, Calif. (248) 312-4119 (805) 418-8103 john.tews@jdpa.com syvetril.perryman@jdpa.com
No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power and Associates. www.jdpower.com/corporate
Photo: http://www.newscom.com/cgi-bin/prnh/20050527/LAF028LOGO-aPRN Photo Desk, photodesk@prnewswire.com