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...
- 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".
- 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.
- 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. - 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.
- AMEX, USAA and all of their affiliates do not want the bad consumer relations this push back is creating with their members and customers.
- 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.
- 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"
- Keep calling your National and State Dealer Associations demanding they get involved and stay involved... No excuses.
- 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.
- 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
Comment
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Comment by CJ Romig on November 30, 2011 at 11:34am
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@Larry ok...I'll buy that...
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Comment by Larry Muirhead on November 30, 2011 at 11:31am
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@ CJ
My numbers were based on what we'd do with 3rd party leads and JOSE who sold 200 ZAG deals.
What we'd do with the $60K in TC fees if applied to 3rd party leads which can close at 10%... ok?
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@Larry TC leads do not close at 10%..Not even close..
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Comment by Jim Kristoff on November 30, 2011 at 11:27am -
BINGO!!!!!!!
- Comment by Keith Shetterly 3 minutes ago
Amazing that folks just don't get this: It's NOT a lead. It's NOT access. It's an AGENDA. It's as dumb as selling both your kidneys.
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Comment by Keith Shetterly on November 30, 2011 at 11:26am
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@ Arnold . . . I'm not sure where to begin. First, it's not the ACCESS to the data, it's the fine-print access + USE of the data against the dealer. This is new in both intent and scale, so acting like it's old news is ridiculous. Second, it's the stated direction of unstaffed showrooms and no dealers by Zag/TrueCar--you REALLY support that? What industry supports your livelyhood?? Third, it's the dealers and folks such as yourself that don't get #1 and #2 as any problem that is a proglrm. From your blog, I don't hate the player or the game. This is a RIGGED game with an end that equals your OWN job's extinction. They're about to replace Cars.com as Yahoo.com's partner. Think that might affect your life? We can close up and just be TrueCar showrooms after about 18 months. Amazing that folks just don't get this: It's NOT a lead. It's NOT access. It's an AGENDA. It's as dumb as selling both your kidneys. My $.02.
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Let's see... What would we do with the fees paid back to TC.
$60,000 X's $20 per lead with the avg 3rd party provider = 3000 leads.
10% closing = 300 sales. Seems like more of a chance to sell more cars and make more money without Zag/TrueCar??? YES? NO?
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Comment by Keith Shetterly on November 30, 2011 at 11:15am
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@ Brad: Do you feel comfortable with the stated direction of TrueCar for your dealership's future? Ala "As a result, he believes dealerships will move toward fleet-type sales where buyers just sign paperwork, pick up their keys and go. No high-pressure, highly compensated salesperson required, he says. "The car sells itself at that point. It's effectively a commodity," he says."http://www.autonews.com/apps/pbcs.dll/article?AID=%2F20110831%2FFIN... and "Upfront pricing is non-negotiable in an environment defined by net margin compression, anonymous access to robust product information for consumers via the Internet, and the commoditization of the car. To facilitate a purchasing decision, the online commodity shopper wants an informational advantage, and that is truly achieved only when the buyer can get access to an upfront price—anonymously—and has the tools to compare that price with the market average, to know it’s fair" http://www.zag.com/websiteASSETS/whitepapers/ZAG-WhitePaper3.pdf
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Comment by Arnold Tijerina on November 30, 2011 at 11:14am
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Here's my take: "In Defense of TrueCar"
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Comment by Brad Alexander on November 30, 2011 at 11:11am
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I'm certainly not a fan of truecar et al but just like anyother automotive buying resource that has come on to the scene; it should make US (salespeople/managers/dealers) better. We should "adapt, improvise and overcome." *Can't go wrong quoting Clint Eastwood from Heartbreak Ridge*
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On August 28 Car Guy Network News reported that Painter, the CEO of Truecar envisions a world where showrooms are void of salespeople. Here's the link: http://www.youtube.com/watch?v=5g4lunW0At0
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