Cars.com CEO Mitch Golub remembers the early days when his company and others would advise auto dealers not to post vehicle prices on the Internet.
“But if you don’t post them today, you will lose the customer,” he tells Ward’s, recounting the evolution of online automotive sales and marketing. “It’s the biggest change we’ve seen.”
First and foremost today is transparency, Golub says of digital must-dos for dealers. “Dealerships need to provide all the information customers need up front.”
Consumer-behavior studies indicate Internet users on marketplace sites such as Cars.com will click elsewhere if a price isn’t included for a listed car. Consumers also typically pass over vehicles priced much higher than other listings.
Dealers needn’t offer the lowest prices, but they must remain competitive on automotive marketplace sites where users can readily comparative shop, say experts.
“There is no secret sauce; it's about the right car at the right price,” says Shaun Kniffin, director-Internet sales and e-business development at Germain Motor, a 17-store, Columbus, OH-based dealership group.
It doesn't have to be the lowest price, “but it has to be competitive,” says Mike Page, Cars.com’s vice president-advertising productsPage.
Listing a used-vehicle price that's competitive lifts contacts by 263% and page views by 191%, according to Cars.com tracking.
Most auto shoppers today do almost everything on line that they previously did at the dealership, except test drive cars and finalized transactions, Golub says.
“The consumer has done all the shopping and has a pretty good idea on pricing, so when they send the dealership an email or a text message, they are ripe,” he says.
That’s why smart dealers respond quickly. “Before, an acceptable response rate was 24 hours,” Golub says. “Then it was eight hours, then two. Now, it’s immediately.”
Agile dealerships have the advantage. “That is why the Internet is a blessing for many dealers but a curse to some,” he says.