Third Party Vendors, The Great Debate

One of the most common (and opinionated) conversations we have heard frequently over the past few months is, what is the true value of third party listing sites in the Automotive ecosystem? These listing sites include Autotrader, TrueCars, Kelly Blue Book, Cars.com among many others. Not only is it a question of value and ROI, but which vendor is the best to work with over the other and why? 



From a dealer perspective, the answer to this question varies greatly from one dealership to the next based on a multitude of factors. Factors can include cost, lead quality, dealer support, are they selling these leads to other dealerships, etc. The question we at Max Connect ask these dealers is, “why don’t you own the relationship with the consumer yourself?”


Though we can all agree there is some value in sticking with one of these 3rd party listing sites for your inventory, the reality is, these vendors often get between the customer and the dealer. Devin Deaton, who is a partner here at Max Connect and was key in pivoting our business into the digital powerhouse it is today explained it best, “It’s essentially like putting your inventory on Amazon or at Costco. You’ll be right up against your competition with no control of that customer's buying journey.” 


Does this strategy work? The short answer is yes, you will get sales by having the right vehicle at the right price for the right customer. Is this model sustainable? Maybe, but there will always be costs associated with making bargains like this, so why not take control and own your customer journey? 


It may seem illogical to advertise outside a given market, but that’s essentially what these services provide - access to customers who aren’t aware of your dealership. In essence, they consolidate vehicle listings and make it easier for consumers to find a particular vehicle anywhere in the country. In some instances, a dealer might get a sale without the customer even going to their site, viewing their other inventory, or interacting with their sales team.


Your marketing budget can create the same kind of national footprint without sacrificing the relationship, and potentially bring more value to the table. And if the word “national” is off-putting, don’t let it be. The right pairing of technology and human intelligence can achieve this outcome incredibly efficiently. 


Many of the automotive dealerships we partner with are taking the forward thinking approach and talking to potential customers directly, through their marketing approach. They work with one 3rd party listing site for their inventory and then allocate the remaining budget towards a true omni-channel approach. VIN prospecting/retargeting and model specific campaigns across multiple channels have proved highly effective at driving sales. Putting their brand and their vehicles in front of consumers who are currently in-market or will become in-market for a new vehicle within the next several weeks. 


If dealers can successfully build brand recognition and stay top of mind among consumers, rather than pay for the customer to create a relationship with a 3rd party vendor first, they will experience greater market share growth and potentially increase gross margins.


This approach not only keeps the ball in the dealer’s court, but it allows the dealer to “own” the relationship with that customer. There is a tremendous amount of value in this, particularly in a considered purchase journey. Specifically in automotive, Google has found that 81% of purchasers research vehicles for up to 3 months before buying and will consider up to 6 brands on average. As a dealer, if you are able to stay in front of the purchaser during this journey and have multiple touchpoints, your odds of winning that customer are much greater. The alternative is to continue relying on the third party lottery machine for hopeful leads/sales.


At Max Connect, we preach and deliver on the omni-channel approach right within the dealership’s digital marketing ecosystem. Our campaigns are audience led using real-time consumer behavior data to optimize marketing dollars, generate engagements with in-market individuals, and deliver results month over month.