Car Sales Leads Generated by
Manufacturer Sites Increase Dramatically
sales leads generated by manufacturer-sponsored automotive online
buying services have exploded over the past year, and closing
ratios from online leads have also increased, according to the
J.D. Power and Associates 2003 Dealer Satisfaction with Online
Buying Services StudySM released recently.
study finds that sales lead generation from manufacturer services
has increased a dramatic 75 percent over 2002from an average
of 18 leads per dealer per month in 2002 to 31 in 2003. Closing
ratios from manufacturer service leads have also increasedfrom
17 percent in 2002 to 18 percent in 2003.
although slow to the market relative to independent sites, have
entered the online buying market in dramatic form to the delight
of their dealers," said Dennis Galbraith, senior director
of automotive Web site research at J.D. Power and Associates.
"The Internet is impacting the purchasing decisions of vehicle
buyers more than ever before, and the quality and quantity of
leads generated by online buying services directly impacts which
services dealers will continue to use."
study finds that, in general, independent online buying services
deliver the most leads, while manufacturer sites deliver the lowest
cost per lead to their participating dealers. Hybrid services,
which provide leads from both Internet and non-Internet sources,
deliver the highest closing ratios.
number of new-vehicle leads generated by independent services
has increased 25 percent over 2002, from 31 to 38 leads per dealer
per month. On average, dealers experience a 15 percent close ratio
with leads from independent online buying servicesup from
13 percent in 2002. Hybrid services have not significantly increased
their lead production or closing ratios. However, dealers average
a 26 percent closing ratio from hybrid service leadsthe
highest of any service type.
average, both manufacturer and independent sites deliver higher
overall dealer satisfaction than they did in 2002, with manufacturer
sites experiencing significantly higher satisfaction than independent
or hybrid services. Among independent online buying services,
cars.com, Dealix, AutoTrader.com and Autobytel.com receive high
ratings from dealers.
dealers respond to online leads is critical," said Galbraith.
"Having a skilled dealership Internet specialist responding
to leads from online buying services helps dealers maximize average
gross vehicle profits. Responding with up-front discounted pricing
also helps. Dealers who withhold price information until Internet
shoppers are in the dealership may be driving business away and
are typically not making up for it in profit margin. Fortunately,
most dealers are adapting very well to the increasing impact of
2003 Dealer Satisfaction with Online Buying Service Study is based
on responses from 1,145 dealers throughout the United States.
Power and Associates)