OEM Web Site and Digital Advertising Requirements

Just some thoughts about what is happing in our business:

There is a requirement by some OEMs to force their dealers to use a limited number of Certified Web Site Providers. There is a major OEM that is now doing this. Reasoning is that these 6 vendors make up 85% of current providers for their OEM Dealers.

Every retail market is different. To force OEM dealers to choose between only 6 web site providers, that not only work with our other OEM dealers, but our competitors as well, limits our marketing and strategies at our local level. Also, these companies are capturing all our data and customer usage information to do what they want with.

What can they do with this data, some examples of companies using dealer data:

Recently, I was told by an Third Party Vendor representative that they have a marketing program that uses data from all their sources , including their dealer web site products, to market new car shoppers. So people going to a dealer web site could be marketed to by a different dealer using this program.

I understand that there was a Third Party Vendor that was used dealer data and made some sort of deal with independent large Dealer Group. Other vendors in the past were using dealer data too for other products and services.

Seem to me, by forcing OEM dealers to use these 6 companies, we are increasing the value of these companies and helping them to take over the market, causing a lot of other great web site companies out of business. These 6 companies will have all the data from these dealers and other OEM dealers to use and sell the way they want.

I think there is a danger in putting all our digital customer information and behavior in the hands of a small number of non-exclusive vendors. These companies are digital information companies, not really web site vendors.

Our advertising is what drives people to our web site and to some extent, the OEM’s web site. It just doesn’t seem right to have to use one of these vendors or be penalized by not getting Co-Op, receiving OEM leads or other limitations.

Due to the strict OEM compliance Guidelines, there should be no need to force dealers down this path.

I would appreciate an insights anyone else has.

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Permalink Reply by Keith Shetterly on January 31, 2021 at 4:30pm

I have personally studied this since 2005. The OEMs have (themselves) collected more information on the marketplace using this strategy than at any other time in the history of the car business--by a factor of about 1000. Not that they always use it smartly or wisely, but they do use it--and they also allow these website vendors to sell their data to other third party sites. Tracking customer behavior along the path to purchase so that these vendors can sell it to third parties OR directly to dealers on "in-market" email, timely digital advertising, etc.

What you're describing is the OEMs don't really care that you discriminate in your marketplace to YOUR success, they plan on sales across a district from whatever point(s) get the sales job done. And so they market that way, themselves, and dealers (you) pick up the crumbs from their King's Table.

This is why there is a whole sub-market of vendors selling "competitive advantage" that aren't directly co-op'd.

Essentially, OEMs have flattened the marketing space so that you really can't conquest using their marketing.

If you want to win by conquest, you need to find a reliable partner and plan a budget to do that. It will take some experimentation, likely, and (perhaps) some losses before you win.

To me, the only path to winning is to find things your competitors are NOT doing in your market. Or at least not doing well.