At NADA 2020 in sunny Las Vegas, host Jim Fitzpatrick was joined by Jessica Stafford, Senior Vice President and General Manager at Autotrader and Kelley Blue Book. The pair discussed common mistakes dealers make when interacting with consumers online and how to avoid them.
Jim Fitzpatrick: Let’s talk a little bit about how’s the dynamic between shoppers and dealers evolved?
Jessica Stafford: Well, we see a changing, and from a consumer standpoint of course, looking at it across Autotrader and Kelley Blue Book, these two big consumer brands in this space, our goal along the way is to help those connections between consumers and dealers, of course. But we continue to see the dynamic shift as consumers are doing more and more research, close to 14 hours of online research ahead.
Jim Fitzpatrick: 14 hours?
Jessica Stafford: Yeah.
Jim Fitzpatrick: Oh my god.
Jessica Stafford: It’s a lot.
Jim Fitzpatrick: It is.
Jessica Stafford: With that dedicated time, consumers then expect to contact a dealer either online or when they do walk in the store, and they want that dealer to know something about them. Right?
Jim Fitzpatrick: Imagine that. Rather than starting all over again.
Jessica Stafford: All over again.
Jim Fitzpatrick: Right.
Jessica Stafford: And so we’re seeing that being a really important change in the dynamic with those connections, because it puts really high expectations on the dealer to leverage the data and the information that a consumer is giving them in order to create a personalized experience.
Jim Fitzpatrick: Sure. What are some of the mistakes that you feel dealers make when interacting with consumers online?
Jessica Stafford Well, I got to tell you, I think the one biggest mistake is probably at that exact moment between the online to in-store connection.
Jim Fitzpatrick: Okay.
Jessica Stafford: Because consumers are doing all this activity online first, if you then submit a lead or make contact with the car dealer and then walk into the store, and that salesperson starts you all over again from the beginning of the process, that’s kind of that golden moment to really meet a consumer where they are, meet and exceed their expectations by knowing who they are and what they were doing and kind of carrying them on from there. We see that idea of meet the consumer where they are as really the biggest opportunity and probably the biggest area for mistakes right now, so make sure you make contact with a consumer the way they want to. If they’re interested in chat and text, get ready to chat and text back with them, because they’re not all necessarily picking up the phone like they used to.
Jim Fitzpatrick: That’s right. That’s right. And for dealers that are not chatting and texting to their customers, they’re going to lose customers, aren’t they?
Jessica Stafford: That’s right. That’s right. We still see consistent numbers in the 15 percent or so range of consumers that make physical contact with a dealer before they walk into the store, but we see those numbers start to shift when you talk about these new technologies. Not so new in general, but to the automotive space of really leveraging chat and text. If you’re not ready to communicate with a consumer the way that they want to, you might lose that customer in the first place.
Jim Fitzpatrick: That’s right. That’s right. And this is no longer a generational thing, right? We used to say, “Oh, it’s millennials or it’s young people that want to text.” It’s everybody, right?
Jessica Stafford Yeah, it’s across the board. Yeah. We pay close attention to millennials, gen Z, this younger audience that absolutely demands that type of engagement-
Jim Fitzpatrick: Of course, yeah. That’s a gimme, right? Yeah.
Jessica Stafford: – but it’s across the board. It’s just easier. It’s convenient. It helps consumers save time. It makes it more convenient, and that’s what they’re looking for.
Jim Fitzpatrick: Yeah, for sure. What enhancements is Autotrader debuting to help dealers drive higher quality leads to their dealership?
Jessica Stafford: Well, that truly is our biggest focus, is the quality and the quantity. For us, we want to drive quality leads, quality engagements that drive profitable sales. We’ve done a lot of research around that recently, and it’s great. Our leads tend to close over 70 percent higher than the competition, and what we see as we dig deep into that is that the profitability of each of those leads to the car sale is over two times higher than the average of the rest of our competition. And digging into some data across Cox Automotive, that’s given us a good guiding light to make sure that we’re creating products and tools that drive that quality.
Jessica Stafford: We’ve got new products we’re talking about at the show. Things like advanced ads, which is a way to go out and retarget consumers that were on Autotrader and Kelley Blue Book looking at a dealer’s listings, go back out and get in front of them again offsite. Leverage these powerful brands that we have like Autotrader and Kelley along with the dealer brand in order to bring more quality consumers to their doors. We’ve got tools like that. We do have a managed chat tool that’s an added value to our customers that helps them with that communication we were just talking about, so that consumers can engage with dealers, or we have a managed chat function that’ll engage on behalf of the dealer if they’d like to around the clock.
Jim Fitzpatrick: That’s great. That’s great. Wow. That’s really good. And as we know, most car shopping is taking place from late hours of 7:00 or 8:00 at night through about 11:00, 11:30?
Jessica Stafford: That’s right. It’s at the convenience of the car shopper, right?
Jim Fitzpatrick: That’s right.
Jessica Stafford: They might be working all day, at school, taking care of their family, and then when it’s convenient for them, sitting on the couch and doing that research. Yeah.
Jim Fitzpatrick: That’s right. Yeah. I had interviewed this dealer. He’ll remain nameless, because I’m sure he doesn’t want me to drop his name, but he has 27 dealerships in the Northeast and we were talking about the relevancy of third party lead providers. And he said, “I couldn’t live without Autotrader and Kelley Blue Book in my family and my suite of vendors that I do business with,” and he was a huge fan of yours. I thought I’d mentioned that to you when I saw you, because obviously at the head of Autotrader.
Jessica Stafford: Well, that’s awesome to hear. Yes, yes!
Jim Fitzpatrick: But he said, “No, it’s we’re in a day now that you need every single buyer you can get your hands on that’s online.” He said, “And of course, with Kelley Blue Book and Autotrader, they’ll start out there in a very big way. I want those customers. That’s where I want to be.” So the notion that dealers can maybe live without a third party lead provider or a Kelley Blue Book, don’t try it. Yeah, she said, “Don’t try it!”
Jessica Stafford: Yeah, yeah. Well, it’s great to hear. It’s kind of the thing we’ve said is, you fish where the fish are.
Jim Fitzpatrick: That’s right.
Jessica Stafford: And consumers consistently are coming to Autotrader and Kelley Blue Book in their research process throughout the whole process, and so getting in front of over 80 percent of car shoppers in any given month, it’s important. And as consumers continue to go to these third party spaces to do their shopping, to compare… And again, we’re lucky with the two brands that we have, Kelley Blue Book, really emphasizing the trust and confidence in the pricing and partnering with dealers on that. And then of course on the Autotrader side, the breadth of shopping and discovering the vehicle that’s right for you.
Jim Fitzpatrick: Yep, yep. That’s right.
Jessica Stafford: Yes, we feel like it’s still a really powerful part of the process.
Jim Fitzpatrick: Yeah, that’s great. What advice would you give to a dealer to maximize profits and attract more consumers to their lots?
Jessica Stafford: I think at this point, it really feeds into what you were just mentioning. I mean, you’ve got to get in front of the right shoppers. You’ve got to really try to own your market and think through the ways to get in front of the right shopper with the right car at the right time and the right message. Everything that we’re doing at Autotrader is relevancy-based. We launched an all new relevancy algorithm in the middle of 2018, which really we’ve continued to optimize day-by-day in real time to today in order to make sure that we’re using all the data we have across Cox Automotive, knowing what shoppers are looking for, and being able to target the right shop or with the right vehicle.
Jessica Stafford: I think to a dealer, that’s exactly what they need to be doing today. Make sure that your marketing and all of your media, your tools are efficient and effective. And we’ve got so much data and technology at our fingertips. Why not use it and get in front of the right person at the right time? And again, really focus on the quality and the quantity, because we want to make sure that the leads that we drive to our dealer customers are going to close. Why spend time working leads that won’t? I think using tools like that, leveraging the data is really key these days.
Jim Fitzpatrick: As we hear so much more about digital retailing, every dealer is trying to get their hands around digital retailing. What does it mean? When does it start? I say it starts when they click on to a site like Autotrader, right? I mean, their digital experience begins with the shopping, doesn’t it?
Jessica Stafford: Yes, yes.
Jim Fitzpatrick: And goes all the way through the delivery.
Jessica Stafford: Through the purchase, yeah. We in our industry in automotive, we tend to think about digital retailing because it’s somewhat new for us, and all of us, this idea of buying online. But if you put yourself in a car shopper, a consumer’s shoes, they’re just used to buying everything online.
Jim Fitzpatrick: Like, “What are you waiting on?”
Jessica Stafford: For them, it’s just retailing. Everything should be digital, right?
Jim Fitzpatrick: That’s exactly right.
Jessica Stafford: Yes, for the moment that they start their research online on Autotrader or Kelley all the way through the delivery. What we continue to find is they just want as much of the process as we can give them online and digital. And that might mean from their couch at home, or that just may mean still in the dealership, but digitally, so it’s all enabled to be seamless and simple.
Jim Fitzpatrick: That’s right. That’s right. Seamless is the key too. Jessica Stafford, Senior Vice President and GM at Autotrader and Kelley Blue Book, I want to thank you so much for joining us here at CBT News.
Jessica Stafford: Thank you so much for having me.
Jim Fitzpatrick: It’s always such a pleasure. You have a wealth of knowledge because of where you sit and your perspective of the auto industry as a whole, so thanks so much for joining us.
Jessica Stafford: Thank you so much.
Jim Fitzpatrick: Yeah. Thanks.
Jessica Stafford: Excited for a great NADA.
Jim Fitzpatrick: Thanks.
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