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 Keith Shetterly on November 30, 2011 at 1:20pm

I vote NO TRUECAR/ZAG.  KILL THE BEAST.

Comment by Keith Shetterly on November 30, 2011 at 1:19pm

Anyway, so far TrueCar has Zag taking all your sales data (across 5,500 dealers, so they say), mixing it with "other" sources, and coming out with a new-car "market" price.  And they collect $299 per sale for sold leads.  Next, they use Clearbook to set your used car pricing ala your u/c inventory tool (with a tie-in from DealerTrack, no less).  And they are now Yahoo.com's partner for cars instead of Cars.com.  Oh, and they have $200million in capitalization for TV ads, etc. that they are now running.  AND they bought ALG (lease residual barometer).  So, essentially, for their GROWING number of "deals", they will control the new car pricing, your used car pricing, whether you can hold on a trade, and eventually whether you can do business.  VOTE HERE, RIGHT NOW -- who is for and against?  Join the thread if you haven't, and everybody VOTE.  Put your reputation where your keyboard is!  :)

Comment by Brian Willian on November 30, 2011 at 1:17pm

@ Arnold: Believe it or not, some customers realize that a dealer needs to be profitable in order to survive and be there to provide service after the sale.  In fact, I would submit to you that a vast majority of customers could not tell you how much the sales price on their car was within $1000 6 months after the purchase.  Most would say they got a "good deal" which was is the result of liking the sales person, the dealership and the service they receive on the back end.  I have followed this thread from the start and have not read any negative comments toward customers.  I think I speak for all dealers when I say I love and care about my customers much more than TC does.  Don't miss that fact, folks, the car buyer is the dealer's customer -- not TC's!  In fact, TC doesn't receive one copper from the car buyer.  This is a serious, well-financed effort to eradicate our profession by a group that doesn't even have to adhere to the same government, OEM rules that we do.  That being said, I think the comments have been quite civil.

Comment by James Carroll on November 30, 2011 at 1:15pm

@Joe  I might add that perhaps transparancy should provide a floor for how much profit is too little.

Comment by Arnold Tijerina on November 30, 2011 at 1:15pm

@Keith I'm not anti-dealer at all. If you read my post, my point is that it is the dealer's responsibility to control where there data is going.. and I'm not trying to de-rail the thread. I think its very pertinent that people recognize that consumers are not going to perceive everything said here as pro-consumer.

Comment by Arnold Tijerina on November 30, 2011 at 1:12pm

@James - I guarantee its more than one of your vendors.

@Joe - Dealers in this thread are speaking out against why it's wrong for TrueCar to give pricing details to consumers. You don't think consumers would take that as a negative? You don't think that feeds more into the old school image of dealers being dishonest and just out to screw someone?

@Larry - I agree with you but the likelihood of every dealer price-fixing is extremely low.

Comment by Keith Shetterly on November 30, 2011 at 1:12pm

@ All:  Let me explain something, please:  Forget what Arnold said.  If you've read anything I wrote here, you'll trust me that this is a bogus derailment of this thread.  Arnold, if you want to discuss that, start your own blog here at DE.  I see that you've SEO'd your own anti-dealer rant blog into the mix here.  That should satisfy you.

DON'T GET DISTRACTED:  KILL THE BEAST!  Not this thread.

Comment by James Carroll on November 30, 2011 at 1:12pm

@Joe  I think you meant Arnold not Larry

Comment by Larry Muirhead on November 30, 2011 at 1:08pm

@ Arnold..

I don't believe this blog would be intrerpreted as a threat to the Image of car dealers.
If we all agree that we can't continue to give cars away at or less than dead cost we are all on the same page.

Comment by Joe Clementi on November 30, 2011 at 1:08pm

@Larry.  Go back and read my last comments.  This thread doesn't contribute to a negative image at all.  Dealers speaking out against something that is detrimental isn't negative at all.  Again, read my last post and then comment.

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