TRUE CAR and ZAG Cyber Bandits, Parasites or Good for the Car Business?

Jim Ziegler asks...

I am hearing a lot of discussion about True Car and ZAG.  I continually scratch my head and wonder if  desperate dealers are doing the marketing limbo "How Low Can You Go?" 

Are we so bad at what we do that we have to line up and pay vendors to lose money? AND, who is giving these people access to your data that is used against you? 

 

Who owns these companies and what might be their ulterior motive?  Sometimes I ask questions to which I already know the answer. 

 

Am I wrong?


What do you think... JIM

 

 

Jim Ziegler's Guidance and Recommended Action Plan:

Ten Areas We Need to Concentrate on to Bring This Monster to It's Knees...

  1. Government investigation of ALL Data Aggregators taking consumer information from dealers' DMS. Sadly enough, dealers who do business with TrueCar are exposed to  liability charges. Cut off all access to unecessary data, no matter who takes it from the dealers DMS and make it illegal to "resell identifiable consumer data" and "transactional data".
  2. Educate Your Fellow Dealers; If anyone takes financial transactional data, they expose the dealer that allowed it to violations, especially if it is passed on to other vendors or shared.
  3. Educate Consumers to what they're doing with their information...
    a. You buy a car from a dealer, do you really want your personal information, and maybe even your financial information, passed along and sold and shared by "God knows who?"
    b. These People Charge the Dealer $300 which the dealers have to build into the deal
    c. Your Privacy and the Security of your Information could theoretically compromise your identity if you do business a company that takes data from the dealership.
  4. Educate Investors and potential investors they could possibly be mislead if anyone is telling them this is a safe investment because of all of the dealers pushing back, associations pushing back, and government regulators in many states coming after TrueCar's business model as NOT compliant, in some cases they're saying it is Not Legal.
  5. AMEX, USAA and all of their affiliates do not want the bad consumer relations this push back is creating with their members and customers.
  6. Cancel your dealership's Affilation with TrueCar. Tell people with TrueCar certificates that YOU don't honor TrueCar and you feel the company is NOT reputable. Educate consumers as to perceived data exposure if they buy from a TrueCar dealer. Make sure that each consumer knows that using TrueCar actually increases their vehicle cost by $300 to $400.
  7. Make the dealers selling at huge losses take all of those deals. Big problem right now is too many Nissan Dealers and others are taking huge losers to get the factory money. The TrueCar reverse-auction business model will continually push those numbers down until the factory money is non-existent. Consumers need to hear from many dealers, "We don't do TrueCar"
  8. Keep calling your National and State Dealer Associations demanding they get involved and stay involved... No excuses.
  9. Get the Manufacturers into the game. If GM, Ford, Toyota, and other majors change the rules about how we advertise and do business to protect the dealers, we can cut off their ability to set pricing. So keep it up at every dealer meeting. Call your Dealer Council Members and protest to your factory reps. Tell the manufacturers, if they want showroom and facility improvements, we need the ability to make fair profits.
  10. Tell everyone you know. Educate other dealers and industry people. Watch the Painter interviews... I believe this is the first time a vendor has publicly announced they intend to bring down the dealers and hijack our business, taking our profits and starving us out with our own data. Painter has said manufacturers and dealers should go bankrupt and he, in his God-like way "will control distribution..."
    When the TrueCar-Yahoo Deal kicks in we need to stand firm and "Just Say No" we don't honor TrueCar deals.

Read this article as a reference: http://www.autonews.com/apps/pbcs.dll/article?AID=%2F20110831%2FFIN... 

AND, if you doubt the mission... read this...  http://www.zag.com/websiteASSETS/whitepapers/ZAG-WhitePaper3.pdf

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Comment by James A. Ziegler on February 28, 2012 at 5:45pm

WOW! This could be the beginning of something huge in the Data Wars

http://www.fi-magazine.com/News/Story/2012/02/Obama-Unveils-Online-...

Comment by James A. Ziegler on February 28, 2012 at 9:51am

My friend, Jason Manning posted this elsewhere. I think it's worthy of reposting here....

"I've said it before: vendors have had their run. Now, dealers are gaining intelligence and turning another corner. Best of luck, if you are a vendor who exploited contracts over the last 7-8 years to pilfer dealer data for your own company's research and development, into a new consumer product or site. The puzzle pieces are coming together. Will you be distrusted like TrueCar? Good riddance! If you're not with us, you are precisely against us. TrueCar has become the business model of what NOT to do to a dealer and there will be many more to join them. Don't go away mad. Just go away. You'll change or we will show the door. We are securing our data and future. Don't take it personally if your consumer product fails or stalls, due to our future changes in our approach to your contracts. Don't get bent if we require TRUST to be the underlying theme..."

Comment by Michael Timmons on February 28, 2012 at 9:49am

@ Heather. Tomorrow, February 29th, all Maryland dealers that are currently active or inactive on the TRUECar program will be receiving an "ALL CLEAR" communication and specific details on how TC will be operating in the state. This will include regulatory compliance, OEM compliance, a more "dealer friendly" agreement and more clarity on how TC uses the data it receives. Thanks for your patience.

Comment by James A. Ziegler on February 27, 2012 at 1:45pm

In spite of Mike's great demeanor and personality...He still works for Truecar, never lose sight of that. AND TrueCar is NOT the dealers' friend in any way.

I am now focusing on larger issues. Although I can't tell you everything yet, I am meeting some key groups who are interested in hearing about Data and Truecar and Data-pirates in general. Some discussions with National Dealer Councils of major manufacturers. Although the majority of the discussion will center around TrueCar and their hostile business model, we are also focusing on a much larger Data-Killing initiative at a national level in our industry. 

As I have told a number of people of interest,the battle is much larger than just TrueCar. 

In recent weeks I have been contacted by several of the largest Data-Aggregators in the industry and we have meetings in coming weeks at their request. If I said I have had conversations with half a dozen large vendors at their request, that would be accurate.

I question I think needs to be investigated by government agencies is this... "I wonder if USAA is sharing any of their customer data on military and government employees and retirees financial information with TrueCar? 

When we finally educate the public that TrueCar and companies like TrueCar are extracting their personal data from the dealers' computers, maybe we can create an atmosphere restoring the trust that Scott painter and people like him (Edmunds, CarFax, etc.) have systematically torn down perpetuating fear and stereotypes. 

TrueCar is as evil and anti-dealer as ever, Scott Painter is touring around the country still promoting the same arrogant, superior anti-dealer rhetoric and diagrams the same anti-dealer business plan as he attempts to work the public against auto dealers. Nobody likes him or trusts this guy or believes anything he says. 

Comment by Keith Shetterly on February 27, 2012 at 1:18pm

@ Thomas:  Jim is really the guy who has pushed very hard and brought this issue to light.  I rallied behind the wrongness of re-purposing the data against the dealer and the amazing way that CEO Scott Painter talked badly about the dealers.  I **WANT** modernization of dealers because they won't survive without it; I just didn't think a cataclysmic approach was warranted.

@ Jim:  I hope those companies contacting you are on the dealers' side, regardless of what they do or don't do with data.  I'm very interested in any updates that come from the meetings you mentioned.  Thank you!

Comment by Thomas A. Kelly on February 27, 2012 at 1:11pm

Thanks Keith and James...Your time and hard work is appreciated fellas.

Comment by James A. Ziegler on February 27, 2012 at 1:09pm

Keith, I strongly agree. Mike has been sending out a lot of form messages to car people, I have several on LinkedIn and other mediums he sent to car people that are nearly identically worded. He's a great ambassador for a bad company. 

You would be amazed how many vendors have contacted me in recent weeks to discuss what they do (or claim they do not do) with consumer data they extract from Dealers' DMS systems. 

I have several meetings with Dealer Groups on the subject scheduled and manufacturers. Although TrueCar will be a large part of my onstage presentation, the larger issue of Data-Piracy is in the forefront of the events.

Comment by Keith Shetterly on February 27, 2012 at 1:03pm

@ Heather:  Mike's a very like-able (car) guy at a very unlike-able (un-car) company.  I focused on how NON-dealer-centric TC has been and the non-dealer-centric future that Scott Painter, er, "painted".  And how, though dealers pay TC's bill, that TC, in my opinion, forgot (if they ever knew) who their real customer was (NOT the consumer).  I think TC feels singled out versus other lead models, but I told him it wasn't the same when a company such as TC ran around publicly pushing with the anti-dealer message from the top.  Regardless, data--more importantly the USE of data--by any vendor is now the issue, imho.

And I think that part is just about to get VERY, VERY ugly across the industry, and if TC were starting today perhaps guys like Mike would've been able to get TC on the right side--the DEALERS' side--of data use out of the gate.  $200million and a data center from Star Trek aimed in a dealer-centric fashion would've been very powerful.

As it stands, I don't know if any current lead vendors can overcome the natural schizophrenia of presenting a strong consumer face but getting paid by the dealer.  That has been tolerated for a long time, and I think that age is coming to an end.  I shared that viewpoint with Mike, too.

Comment by Heather Graham on February 27, 2012 at 12:39pm

Any nuggets you can share Keith?

We have been awaiting the 'revised' Maryland dealer agreement (since proposed launch date of Feb 8th) - but have yet to see it. I'm guessing that they are running into many different hurdles as they try to revamp/restructure their offerings. 

Comment by DealerELITE on February 25, 2012 at 1:15pm

37,469 views is the Most Viewed Blog Ever on dE! Is this a World record for an Automotive Social site?

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