NewGen Launches Carabunga
27 June 2000
Carabunga.com Goes Live -- Auto Industry Backs the Power of Online Promotions
Business Editors & Automotive/High-Tech WritersSAN DIEGO--June 27, 2000--Carabunga.com, a wholly-owned subsidiary of Newgen Results Corp. , today announced the official launch of the dealer's one-to-one marketing vortal. The Web site (www.carabunga.com) was recently introduced in private demonstration sessions at e-AUTOWorld Chicago, June 19-21, and received enthusiastic responses from both manufacturers and analysts within the automotive industry.
In today's fast moving environment, Carabunga.com delivers an easy-to-use, cost-efficient method to deploy online promotions that target and deliver the right message, to the right customer at the right time, from their own proprietary customer database.
In addition to providing dealers a method to create customized online promotions (instant letters, e-mails, and coupons), they are also able to schedule follow-up teleservice efforts to help increase consumer visits to their dealership, whether for routine service and maintenance or to purchase new or used cars.
Leading automotive manufacturers such as Kia Motors of America recognize the benefits that Carabunga.com's online promotions provide with the ability to track costs and return on their investment.
"Carabunga.com came along at a perfect time for Kia," said Lloyd Law, manager, Fixed Operations Marketing at Kia Motors America. "From what we've seen, there will be great synergy between the portal we have in development, kdealer.net, and Carabunga.com. But most importantly, Carabunga.com will enable our dealers to quickly respond to the needs of their various departments to build immediate, highly personalized promotions with built-in return-on-investment tracking abilities. We're pleased that our Parts & Service Advisory Group members were able to help them beta-test their program."
In addition to Kia, other manufacturers such as Volkswagen of America have also recognized the power of online promotions. www.dealerfirst.com, a Web site that incorporates e-COUPON technology from Carabunga.com, enables Volkswagen dealers to quickly create targeted, highly customized direct mailings of service coupons to both existing and prospective customers 24 hours a day, 7 days a week via the Internet. With www.dealerfirst.com, dealers are able to choose either a featured promotion, or they can craft their own coupon mailer from several refined examples available to member dealers as point-and-click dynamic HTML files.
Industry analysts that monitor the automotive industry are also quick to comment on the forward-looking resources and capabilities of Carabunga.com.
"The Internet represents a significant and unprecedented opportunity for the automotive industry to create a new era of customer relationship management. The future Internet customer will expect personalized marketing messages, such as online promotions, that are tailored to his or her specific needs. Auto manufacturers, dealers and other market participants that are unable to deliver this level of customization in their marketing activities are doomed to fail," said Thilo Koslowski, senior analyst for E-Market Intelligence Automotive, GartnerGroup.
The Power of Online Promotions
The effectiveness of personalized promotions is well documented. A recent study by the Polk Company, reported in the Jan. 24, 2000 issue of Dealers Edge, showed that a significant number of new car buyers were influenced in their purchase decisions by dealership Customer Relationship Management (CRM) that took place prior to the purchase. Two of the five items that customers reported receiving most often -- personalized letters and owner magazines -- were also rated as the most influential in making a decision. A 1999 study of new car buyers by R. L. Polk indicated that coupons for discounted service influenced 81 percent of new car buyers.
Manufacturing giants like General Mills Inc. and Procter & Gamble Co. spend millions placing coupon inserts into Sunday newspapers. Designing and distributing coupons over the Internet or via a targeted mailing list eliminates many of those costs, as witnessed by the fact that there are over 100 Web sites devoted to getting coupons online.
"We expect lots of `hits' when Carabunga.com revs up," said Jim Roche, president of Carabunga.com. "News of the results of our pilot testing has already generated much interest in the industry. One of our test campaigns on a new tire promotion had a 23 percent response rate. Another campaign that we tested was a new car sales promotion. The dealer wanted to sell a 2000 model car to existing owners of the same but older model. Out of 243 letters -- 5 vehicles were sold (4 new and 1 used), for a substantial profit and a return on investment of 25 to 1. We have definitely validated the concept behind direct marketing and establishing customer relationships to boost sales."
This news release contains certain forward-looking statements that involve risks and uncertainties, including statements about the formation and operation of Carabunga.com and the benefits of new and existing products. Such statements are only predictions and the company's actual results may differ materially from those anticipated in these forward-looking statements. Factors that may cause such differences include, but are not limited to, the response rate realized on Carabunga.com promotions, the acceptance of the Carabunga.com Web site by its customers, the introduction of new products by competitors of the company, and the Company's ability to successfully develop and deploy the Carabunga.com Web site and associated products and services. These factors and others are more fully discussed under the heading "Risk Factors" and elsewhere in Newgen's Registration Statement on Form S-1 (No. 333-62703) and in the Company's most recently filed quarterly report on form 10-Q, each as filed with the Securities and Exchange Commission.