Autotrader beware, many dealers are reeling in their big nets

Whilst speaking to many dealers recently, both franchised and independent, it is interesting the way in which the marketing of cars is constantly evolving.

For example we are encountering many dealers who are becoming increasingly unhappy with the price hikes being introduced by Autotrader. Many are choosing to either limit the kind of cars they put on there or invest more money in their own websites, SEO and pay per click.

One dealer we spoke to told us that having tracked where most of his footfall came from over the last 3 months it was noticeable that, as his dealership sold predominantly newer cars, the money he was paying to Autotrader to advertise these cars was simply not generating the enquiries and the older stuff was selling locally without the need for advertising in the classifieds.

He worked out that it was costing him in some cases £300 per sale because of the lack of enquiries coming through Autotrader despite being paid for upfront and by cancelling his account he reckons it will save him around £1,500 a month.

A brave decision you may think given the sheer volume of search traffic currently enjoyed by Autotrader, which is the Google of the used car trade. But by increasing their prices Autotrader could well force dealers, who may currently choose to market their whole stock of used cars on, to be somewhat more selective on exactly what and how many cars they choose to advertise. This in turn may lead these same dealers to be smarter with how they market their cars elsewhere.

Interestingly many dealers are also telling us that trying to compete on price and being on the first few pages may sometimes be productive where there is a wide selection of similar models and age of car, but it may well be a losing battle in the long run. A lot of car dealers believe strongly that whilst many car buyers may search the web to research and compare or give themselves an idea of what they might have to pay for the car they are interested in, they invariably end up buying locally.

Car dealers who are not selling the volumes they were because of the economy have to recognise that, in order to hit targets, they will need to ensure that what cars they do sell have to be more profitable to make up for the shortfall. By competing purely on price they will be unlikely to achieve this and if car buyers are not prepared to travel long distances in order to save money then dealers have an opportunity to build value in their products and their business whilst providing a great experience so that even in these austere times they can trade profitably by being smarter than the rest.

A catch all approach to marketing their cars by simply throwing them up on Autotrader because “that’s what we’ve always done” may be a thing of the past.

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2 Responses to Autotrader beware, many dealers are reeling in their big nets

  1. Fraser Weir January 5, 2012 at 10:27 pm #

    Following on from your comments you or your readers may be interested in our story. We’ve been using autotrader for the past two years and have always felt their prices to be ridiculously high. Due to the continued pressures on our business to reduce overheads we’ve opted for ebay Motots Pro which will mean we save around £500 per month. If anything we are hoping that traffic will increase. Most of the visitors to our auotrader pages were through our own website which I set up to refer customers to our autotrader stcoklist. Creating a webiste is one thing but creating a stocklist based website which uses reg no.s to create the product details is quite another. Therefore we felt tied to Autotrader. But the fixed low costs of ebay Motors pro mean we can still generate a stocklist and simply point our own search engine optimised site to our ebay showroom pages instead.

    I can safely predict Autotraders downfall ….their business model almost exactly replicates that of yellow pages and anyone who’s monitored their share prices in the past two years will know they are in dire straits.

  2. Mark R January 8, 2012 at 12:28 pm #

    So good to hear you have switched to Ebay Pro, we use nothing else, and although the email requests can be a bit tiresome (from diehard Ebayers who have no intention of buying) generally it has proven very good indeed, best of all its ££££ Hundreds if not thousands a year cheaper to advertise your vehicles with almost exactly the same results as the ever more expensive Auto Trader, for us anyway…………l…

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