Dealix, a division of the Cobalt Group, says it has an answer for dealers who are tired of paying for online leads that have no chance of turning into a sale.
The third-party lead vendor this month is rolling out an initiative, called Quality Pledge, which allows dealers to return leads that don’t match certain criteria.
Under the program dealers can return leads that do not have a working phone number for the person submitting the lead, does not represent an active in-market shopper who is 18 years or older or is a duplicate lead previously sent by Dealix.
Dealers can contact Dealix through its Dealer Extranet. Dealix has three days to review the lead. If it’s good, Dealix will provide the dealer with all of the appropriate information to help initiate contact with the customer. If the lead is determined to be bad, Dealix will credit the dealer’s account.
Anna Zornosa, executive vice president and general manager for Dealix, admits the company could not have offered such a quality pledge last year.
In past years, Dealix, along with most other lead agreggators/providers, would sell dealers leads in bundles. It was a volume game – Dealix needed huge numbers of leads to feed the beast. As a result, the firm, and others like it, often obtained leads from inferior sources.
If a dealer complained about lead quality too much, lead providers typically would tweak the mix, making sure the dealer received more optimal leads.
The technology wasn’t advanced enough to let vendors do any differently.
Dealers, likewise, had no choice but to play what was the only game available. That meant paying for leads that weren’t needed.
It’s a different game now. Dealix has winnowed its lead volume from millions to 300,000 a month, resulting in leads with better quality.
“We’ve had a year of tremendous improvements in technology and relationships,” Zornosa says. “An immense amount of innovation has gone into this. It allows us to spell out exactly what a valid lead is and what we will charge for it.”
Despite all of the technology improvements, no provider can absolutely guarantee some bad leads won’t slip through, she says. But the company now is at a place where it can offer these types of screening services.
Dealix has been busy despite the industry downturn. In January, the company launched an overhauled UsedCars.com site and through a partnership with Vast Inc., is able to charge dealers for used-vehicle leads on a per lead basis.
The firm has had 50% growth year-over-year in the number of dealers using the service. Vast’s partnership with Kelley Blue Book now means Dealix’s used-vehicle inventory will be in front of 18 million consumers – up from 5 million.
Dealix also has deals with several large portals, powering the inventory listings on Yahoo Autos, MSN and AOL. “If you’re an auto maker, you can’t buy leads from those sites without talking to Dealix,” Zornosa says.
Meanwhile, parent company Cobalt Group, known primarily for marketing and building dealer websites, has been under pressure from firms such as Dealer.com, which has bit into some of Cobalt’s business recently.
A partnership with General Motors Co. in which the auto maker paid Cobalt to build websites and provide marketing services to its dealers, opened Cobalt to criticism that it was more focused on serving GM’s needs instead of those of GM dealers.
Additions in the last couple of years to the executive ranks are helping change that perception. Cobalt best serves an OEM if it focuses on taking care of the auto maker’s dealers, says an executive.
Greg Meyer, vice president-product development for the Cobalt Group; Chris Reed, who runs Cobalt’s marketing efforts and others have tried to create a laser-like focus with a primary goal of taking care of the dealers.
Conversations with CEO and founder John Holt reveal him to be as passionate about the business as he was when he started Cobalt in 1995.
The firm has launched several new marketing initiatives this year, including mobile solutions and digital display advertising that consists of geo and behavioral targeting.
