Opinions & Advice

Autotrader – Partner Package or Premium Package?

Jeff Kershner
Posted onMar 4, 2007 at 4:05 AM
Updated onUpdated on Oct 23, 2008 at 11:59 AM

I thought this was worthy of a separate posting. Peter over at Mercedes-Benz had a few questions and I was up for the challenge!!

Jeff, All this talk about Autotrader.com. I have been a big believer of “featured listings”. About 1/2 the cost of premium listings. If you actually put search criteria that an actual car shopper would use (example Mercedes-Benz C230 in a 25 mile radius), Your featured listing will still show on the first page of listings. You can use the $1,000 you save monthly on Dealix or another lead provider. Just some thoughts from an old-school ISM.

-Pete

Peter, I’m in line with your thinking. I’ve been considering dropping back down to the Featured Listings.

From 2005, working the (lesser) Premium package, to 2006 working the Partner package, my accredited AutoTrader sales increased ONLY 1.4 vehicles a month. Was this due to being a Premium partner or due to having a larger selection of used car inventory in 2006?

Thinking about this, I dug a little deeper and compared JUST my Pre-Owned Mercedes vehicles sold from 2005 to 2006. I did this because we are a Partner with ONLY Mercedes-Benz, this means my non Mercedes vehicles are listed in the Premium displays and not the Partner (top) displays. I recorded a .3% increase (basically none)  in Mercedes Pre-Owned sales on the 2006 Partner package over using the 2005 Premium package.


So what about my Non-Mercedes-Benz? From 2005 to 2006 my increase in AutoTrader accredited sales increased .45. I looked at this figure for the simple fact that maybe my Partner Mercedes listings helped filter customers into our Non-Mercedes inventory. This obviously was not the case.

I also tracked the average gross of our Pre-Owned Mercedes-Benz over Non Mercedes-Benz AutoTrader accredited sales. My Pre-Owned Mercedes sales gross averaged $200.00 over my Non Mercedes sales gross. An increase, but not a huge one.

So..according to my reports, spending another $1,000 or so more for the Partner Listings is not making much sense.

AutoTrader would be quick to argue this due to the fact that you get a Banner Ad with the Partner and not the Premium. How valuable is that banner ad, especially when dealers and consumer have to deal with

stuff like this? I track my banner ad CTR (click through rate) every month and if I were paying just 200.00 per month for my banner ad on AutoTrader, I would be averaging around $3.77 per click (Ouch!). I believe that the banner ad has some branding value to it, but I’m not sure what price tag you place on it and there really is no way of tacking it unless you are sending the customer to your dealer website from your banner ad and you are able to track the conversion from there.

If I’m not mistaken the Partner package also allows you more then 9 photos and this could be a benefit that gives you a slight advantage over other dealers (though I find most dealers paying for the Partner Listings still only display 9 photos or less). I would always use this as an excuse to get a customers email address. “Mr. Smith, share with me your email address, I have 15 more photos of this car I can send you.” Then send them a link to the photos on your website.

Now AutoTrader is offering their 2007 products and I’m sure they have all new pricing to go along. I know it
seems like I’m hard on AutoTrader but I guess when you’re one of the “Big Guys” everyone has their eyes on you. Overall my ROI makes total sense with AutoTrader and I’m not looking to drop them unless they price themselves so far out of the market, though that seems to be their trend, especially for smaller dealers like
mine.

Jeff Kershner
Founder of DealerRefresh - 20+ Years of dealership Sales, Management, Training, Marketing and Leadership.
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Jeff-

I don't think you are being hard on Autotrader- not at all! When they give us some token increases in abilities of their new products for an additional $500/month, let's make sure it is going to make sense.

Last spring I had to fire Autotrader because according to our records, we had sold 2 vehicles in November and 2 more in December. Deep down, I knew we had sold more, but I had nothing to stand on. I got a full-court press from them in trying to intimidate me to not cancel, I would be missing out on some 300,000 autoshoppers, teh largest car sales point in the US, etc.

I got back on the bandwagon 4 months later, and started to get some results and now use the premium listing. I have had great results, but I am not afraid to hammer them if need be. We are accountable for our numbers, and they (the vendors) need to be accountable to us!

Of note, the other day an ex Autotrader rep alluded to a lofty goal they had set ("X factor" or something to that effect). Basically, it was a monumental goal of sales set several years ago, and they now, with modest (ha, ha) rate increases each year hope to achieve this goal.
A
We've had numerous issues with AutoTrader in the past, and everytime we re-sign with them those same issues come up again. It hasn't mattered if we were a premium dealer, a basic dealer, or are getting our cars up there for free because we advertise in the magazine. The issue is inventory - it always turns into a major mess with them. The first month things are always fantastic, but somewhere during the second and third month it all goes to hell:

1. Sold units do not come off AutoTrader - even after calling to have them removed.
2. If you do not use their back-end tool, you cannot get anything done. When using multiple third party sources, and having multiple rooftops, this is extremely cumbersome.
2. Atlanta is completely oblivious to their local reps and dealers - they might as well be in India
3. We can put 1,000 cars on AutoTrader and only sell 5 or less units while those same cars are listed in other places with much higher results.

To get back to the original question, it has been my experience that it doesn't matter which level you're at with AutoTrader. Why waste the money on the more expensive packages?
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    Jeff Kershner
  • March 30, 2007
Alex,

I might be finding out very soon if it makes sense to drop down from Partner Package to Premium package. I'll keep you posted.

In regards to your inventory issue. I have never run into that problem UNLESS I change/edit a car in the AutoTrader inventory tool.

I feed all of my inventory from HomeNet to AutoTrader. If I edit or delete a vehicle in HomeNet, those changes WILL reflect on AutoTrader. HOWEVER, if I edit a description, price..ANYTHING in the AutoTrader inventory tool, and save it..it's now "locked". So when you sell that car you have to manually delete from AutoTrader. This is also holds true when Spotlighting a vehicle. If you spotlight a vehicle, it's no different then making a change/edit and again you have to manually delete it. Not sure if this helps or not. I can see if you have multiple rooftops how this could be a real pain. Managing your online inventory can be a full time position.

I usually do quite well with AutoTrader BUT I feel as if I could be doing better then what I am. So far this month I have 6 sold and 2 more to go from AutoTrader. Considering I have only 40-50 used cars on my lot at any given time, that's not bad. If you are not already, track you overall ROI for your lead sources. Take your total gross that you've made on each unit and subtract what it costs to advertise on that ad source.

There are a few tricks that one can do on AutoTrader to sell a few more cars on month. Give me a call sometime and I'll share with what has worked for me. I have to be careful, one of my competitors is all over this site. Hello EuroMotorcars of Germantown!!
A
Thanks Jeff. I've personally been messing with AutoTrader on and off since 2001. I think part of our issue has to do with the fact that we don't use a decent inventory control program. We have been using ADP's WebVehicle, but it works so poorly we basically have to rely on a hack program to get our inventory where it needs to go. Hopefully we'll be making a change soon.

Andy McBride at HomeNet has been a huge help. I would like to use their system or something similar - we're looking around right now.
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Any comment in the negative seems inappropriate here, given my place and position as the "other guy." But really, down the street here in Chicago, I can get a piece of pizza for $4. But a block away, I can get a piece of pizza and a soda for $3.25. Yeah, I like the $4 place and sometimes I am lazy and go there anyway. But the $3.25 place, that pizza is just as good and provides me with a free can of pop. So, lately... I'm strecthing out my legs and going the extra block. My wife is happy, cheaper lunches and more exercise...

Take a second and ask yourself, if the $$$ they want for this stuff worth it. Does it really taste any better? Could you be eating a few lunches for the price one?

That is not for me to decide. But in time, this stuff they are charging for is going to drive dealers to the $3.25 place. And here at Cars.com, we'll gladly send you a case of pop.
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    Jeff Kershner
  • July 30, 2007
Dave, we just signed our contract with Cars.com..can I get a case or red Pop with that?
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