Kbb recently introduced Blue Book CPO Values, bringing greater price transparency to the CPO process. From a user perspective, the process follows the same steps as kbb’s standard used-vehicle pricing and the results page is keyed entirely to CPO – value, inventory, CPO program descriptions, etc.

So far, so good. However, once I dug in further, I was a bit underwhelmed.

First, not all the CPO rules seem to be baked into the tool logic. I was able to derive CPO values on an Audi A4 with 65,000 miles, but since Audi has a CPO requirement of 60,000 or less, this vehicle shouldn’t exist.

More disappointing was the calculation of the CPO value: too often, it’s simply a premium over the Suggested Retail Value. The logic is sound: a used vehicle sold by a dealer is assumed to be in excellent condition, having undergone reconditioning to prepare it for sale. CPO involves additional steps plus an extended warranty, so an additional premium makes sense.

Unfortunately, the premium is too often a static number. For instance, most Audi CPO values ran a $1,900 premium over the Suggest Retail Value, regardless of model, trim, mileage, or year. The CPO premium on a 2006 Audi A4 is the same as the CPO premium on a 2007 Audi A8, despite the latter costing nearly twice as much.

Kbb seems to have a set CPO premium for almost every automotive brand. Luxury marques generally command higher premiums, with all except Acura valued at $1,000 or more. A premium of $450 applies to all of Chrysler’s and GM’s non-luxury brands, despite the wide differences between the makes and models under their umbrellas (and differences between the two company’s programs). Ford’s three marques fall neatly into the $700-$750 range.

BMW is the only brand with a more realistic range of CPO premiums, at $1,250 on the low end for the 3-Series (although that premium doesn’t change across trims, mileage, etc.) and $3,200 at the high end for the entire M lineup (including the M3, M5, and M6).

I don’t doubt that the information is useful for consumers, but assigning a straight CPO premium across an entire brand’s lineup seems problematic. Perhaps kbb just needs more time to refine its algorithm and/or accumulate more data (esp. model-specific).

I spent some time earlier this year at the Grand Bazaar in Istanbul, Turkey – a mammoth marketplace where the price of everything is negotiable. In other words, pretty much like buying a new car at your local dealer. To feel good about the price you pay in the Grand Bazaar, market knowledge is critical.

Finding out what other buyers paid, whether they negotiated aggressively, and knowing if the competition a few stalls down sold the same product all help inform the potential buyer on what a fair and reasonable price for the item might be. And if people will take the time to gather market information to negotiate a price on a $30 silk purse, it is no wonder they want the same market knowledge when buying a $30,000 SUV.

In the automotive marketplace, Consumer Reports has been providing new car market insight (and charging a fee) for many years. Kelley Blue Book has been providing market values on the used vehicle side. However, in recent years this key component desired by car buyers….the “new car market price” ……has now become almost a required “free” component of any automotive web site.

Edmunds, Yahoo!, Cars.com, KBB, AOL, TrueCar, Vincentric, and others compile or publish new vehicle market pricing, with different methodologies, including transaction driven calculations as well as economic estimates based on the supply and demand of the vehicles. Regardless of the methodology used, the objective is to provide consumers (and dealers) insight on a fair and reasonable price to create a more efficient and balanced buying experience at the dealership.

Of course “fair and reasonable” often means different things to the dealer vs. the buyer. A buyer might walk into the showroom waving a web site printout, and want to buy a specific vehicle for that price, from that dealer, at that time…with no negotiation. The reality is that all published market prices are based on averages….which includes at least an average amount of negotiation time, an average amount of negotiation skill, an average amount of dealer shopping, and an average amount of inventory at that dealer.

So when a buyer gets an incredulous look from the sales manager when “demanding” a specific price for a specific make/model/trim, it doesn’t mean the market price estimate is wrong, or that the dealership is trying to gouge the buyer….at Vincentric we’ve found that it more likely means that the negotiation process is still in the early stages, or that a different dealer might provide a different response, or the buyer researched the price for a base vehicle but is trying to by a vehicle built with additional options, or someone thought the market price included destination charge when it didn’t.

What does it all mean to users of the market price information? The availability of automotive market price data doesn’t mean that a vehicle can now be brought to the cash register and purchased like it is a loaf of bread. The market price – regardless of the source – is a key piece of information, with value not because it replaces the need for negotiation, but because it creates a more efficient, balanced, and transparent negotiation in the “grand bazaar” of the automotive marketplace.

Dave Freed leads the Business Development and Market Analysis organizations at Vincentric, an automotive data firm headquartered in Bingham Farms, Michigan.

New data from our 2009 Website Performance Tool (WSPT), performed in conjunction with Compete Inc, tracks the actual online behavior of new-vehicle buyers in the six months leading up to purchase. Prior to this year, our primary source for this information was the New Autoshopper.com Study (NAS), which was based on buyer recollection of their behavior during the shopping process. Contrasting findings from the two studies yields some interesting insights.

The most obvious is that people’s recall is imperfect. According to the 2008 NAS, kbb.com was the most-visited third-party site at 44% of all automotive Internet Users (AIUs). When looking at actual behavior as measured by the 2009 WSPT, that figure drops to 29%. One cause may be that kbb data is embedded into others sites (e.g. cars.com, MSN Autos), so consumers are exposed to kbb (impacting their recall) without visiting the site.

Conversely, actual visitation to portals (Yahoo! Autos, MSN Autos, and AOL Autos) is substantially higher than recalled visitation. Given the ubiquity of search in the way most people use the Internet, it’s likely that shoppers will not always know which sites they are on. In other words, search terms may lead people to images on Yahoo! Autos, but they may not be conscious of actually being on that site.

The recalled vs. actual visitation issue is magnified when considering manufacturer sites. The chart below shows visitation to the manufacturer site by AIU who bought that brand. For instance, according to the 2008 NAS, 94% of AIUs who bought BMW recall visiting bmwusa.com, while the 2009 WSPT number shows that only 29% actually did. The story is similar across every nameplate.

Shoppers can get their vehicle information from a variety of sources (including third-party sites, dealer sites, blogs, message boards, photo sites, etc.) and may not always know where they have been online. While many buyers believe they visited the brand site, most of them actually did not.

Manufacturer sites still play a central role in the online shopping process, but it’s important to recognize just how much competition and noise is out there.

I’ve written many times about the limitations of the traditional RFQ process. One of the primary issues is that consumers have come to regard the RFQ as an invitation to be contacted by a dealer, which is what they may be many people are trying to avoid in the first place! Further, shoppers may not trust dealers to give them straight answers about pricing and availability.

The story is perhaps more compelling with used-vehicles, since RFQs can be tied to inventory. A shopper who wants that particular vehicle must eventually contact that particular dealer, anyway, whether in-person or by phone, email, or RFQ.

Cars.com offers a straightforward mechanism as shown below. All the vehicle information is on one page, along with the option to Email the Dealer.

Autotrader has similar functionality. I also like the View & Print an AutoBiography feature, a unique lower funnel offering.

Kbb takes a slightly different tack by asking the consumer to “Write a message,” using conversational language. It’s still an RFQ, so I wonder if kbb’s metrics are significantly different from the others. I definitely don’t like the automatic mailing list opt-in. On the plus side, the “Get Value” link allows shoppers to easily obtain a pricing report and have more confidence in submitting a message regarding a specific vehicle.

RFQ remains an entrenched process that has proven to be useful to a subset of automotive shoppers. Among major third-party automotive sites, inventory listing + RFQ seems to be the standard approach for used vehicles. Some sites have introduced modest refinements that may improve the process, while also providing other paths to get shoppers to the dealership.

Market pricing data on new vehicles, which has been available online for many years, goes beyond MSRP and dealer invoice to show consumers what they could expect to pay at the dealership. This information empowers consumers, but it can also be misleading. For instance, while the 2010 Audi A6 3.2 has a True Market Value of $45,101, not everyone will pay that exact amount.

That’s why I’ve enjoyed playing around with Vehix’s TrueCar Pricing Report. Vehix provides consumers with a far clearer picture of the real pricing situation by adding Actual Dealer Cost, Good Price, and Great Price to the mix. Here’s the 2009 Toyota Camry I4 Sedan.

The report shows that half of all sales are over the average price, something that may seem obvious but isn’t necessarily clear on other sites. You can pay more than that average and still have a Good Price. Some folks can attain a Great Price, but it’s clearly a minority. In the case of the 2009 Toyota Camry I4 Manual, the average price is actually below the dealer cost (as of Sept 11, 2009) and may represent dealer efforts to clear inventory for the 2010 model year.

Another interesting example is the 2010 Chevrolet Camaro LS, which has generally been selling above MSRP. In this case, paying $600 more than sticker still represents a Good Price.

The data is certainly useful, but is it accurate? By looking at the market pricing data from other sites for these two models, we can see that the TrueCar Average Paid seems to be at the lower end of the range.

Regardless of absolute accuracy, Vehix makes the issue less relevant through greater transparency. I can’t wait to see how other sites respond.

In order to assess the current state of SEO for third-party automotive Web sites, I conducted a field test which I applied a set of automotive search terms to Google and Bing. I noted which sites appeared in the default first page of results – ten for Google and ten to twenty (depending on the type of search) for Bing. My findings are included in the charts at the end of this posting.

This analysis is obviously far from comprehensive, but it does highlight relative standings. The strongest field-test performer was clearly Edmunds, which appeared in two-thirds of all the searches I performed. AOL Autos, Automotive.com, MotorTrend, and Yahoo Autos also did well. On the flip side, Autotrader, kbb.com, and MSN Autos are among those that did poorly.

Comparing directly competitive sites can highlight best practices. For instance, while kbb and Edmunds both offer vehicle overviews, the latter has far more content, e.g. 1,400+ words for the Jeep Wrangler vs. 199 at kbb.com. More content on the pages results in more content to index and a greater range of possible keyword hits.

SEO is just one of many ways that sites can drive traffic. Some automotive independent sites have clearly emphasized their search optimization efforts, while others seem to have given SEO short shrift. But it seems likely that those at the top will have an ongoing advantage against their rivals.

SEO Field Test Results for Google

SEO Field Test Results for Bing

The automotive Internet has developed into a complex web of relationships, with companies supplying content, inventory, and leads to one another. In order to inform our readers, I mapped some of this dynamic as a flow chart (shown below). Please note that not every automotive Internet company and relationship is illustrated. Specifically, lead generation and ad networks have been excluded because of the complexity of these relationships and lack of transparency.

There have been some changes since I last performed this mapping in early 2008.

• Kbb dropped Autotrader and now offers its own inventory listings
• eVox continues to gain ground in licensing its vehicle image library
• Vincentric is supplying more sites with vehicle price / cost of ownership information

How to read the chart
The chart is presented in a flowchart format, in which the basic unit is:

This indicates that AutoTrader has a relationship with Edmunds – specifically, Autotrader powers the used inventory functionality for Edmunds.

Autotrader.com recently unveiled a new homepage that marks a notable departure from previous iterations. As shown below, past homepages (from 2002 to 2008) were somewhat crowded, with at least six distinct sections offering different sets of links and functionality. Among these, research content was given the most prominent placement, reflecting the site’s evolution beyond its origins in used vehicle inventory.

The redesign makes inventory (e.g. “find cars”) the focal point, pushing research further down the page. The page also has a much cleaner design, which should serve to funnel traffic to the primary content areas. The addition of a tabbed section de-clutters the site while still providing homepage access to useful content.

Whether intentional or not, the new organization shares some commonality with cars.com’s homepage, which also places the emphasis on finding/buying a vehicle. One major difference is the complexity of the selection from the homepage: cars.com separates new vs. used search and provides multiple toggles right on the homepage. Autotrader has instead opted for a quick selection that links to a page with more search criteria.

What do you think of the new Autotrader.com?

Four months removed from “The Year of Mobile” it’s clear that many automotive players have finally joined the party. Below is a list of all manufacturer and third-party mobile sites that I could find, along with the mobile URL and homepage screenshot[s] from an iPhone.

As with their web sites, the depth of functionality and overall usability between the different manufacturer and third-party sites varies tremendously. For some sites, especially manufacturer brand sites with significant Flash usage throughout, the primary site is useless on most mobile devices. In these cases, the user should be automatically redirected from the primary URL to the mobile site.

Third-party Sites

Car and Driver
http://m.caranddriver.com/

Cars.com
http://m.cars.com

Edmunds
http://m.edmunds.com

Kelley Blue Book
http://m.kbb.com/

Vehix
http://mobile.usablenet.com/mt/www.vehix.com
Unintuitive mobile URL and doesn’t redirect on iPhone from standard URL.

Manufacturers

Acura
http://www.acura.com/vb/mobile/home.aspx
Doesn’t redirect on iPhone from standard URL, but since the primary brand site has little Flash, it is almost completely functional.

BMW (International site, English version)
http://bmw.mobi/bmw/mobi/handler/0/nn/COM/en/idx.xml

GMC
http://m.gmc.com/
Doesn’t redirect on iPhone from standard URL.

Kia
http://mobile.usablenet.com/mt/www.kia.com

Land Rover
http://landrover.mobi/
Doesn’t redirect on iPhone from standard URL.

Lexus
http://m.lexus.com/
RX-only mobile site

Mazda
[visit http://www.mazdausa.com on mobile device]

Mercedes-Benz (International site, English version)
http://mercedes-benz.mobi/en
Doesn’t redirect on iPhone from standard URL.

MINI (International site, English version)
http://mini.mobi/mini_mobi/en/ct/0_5_home.cml
Doesn’t redirect on iPhone from standard URL.

Pontiac
http://m.pontiac.com/
Doesn’t redirect on iPhone from standard URL.

Porsche
http://m.porsche.com/

Saturn
http://saturn.mobi/
Doesn’t redirect on iPhone from standard URL.

Scion
http://m.scion.com (standard mobile site)
http://iphone.scion.com (iPhone-specific site)

Suzuki
http://m.suzuki.com/
Doesn’t redirect on iPhone from standard URL.

Toyota
http://m.toyota.com/

Volkswagen
http://www.vw.com/mobile/iphone

Volvo
http://mobile.volvocars.com/us
Doesn’t redirect on iPhone from standard URL.

It’s clear; everyone is frenzied over Twitter. Consumers are engaged by the transparency offered by brands and pop-personalities, while brands are attempting to quickly grasp the latest online curve-ball that’s truly swept us away to a whole new tworld. In the automotive tworld, no matter what Twitter’s role is in your marketing plan, keeping regular tabs on the health of your profile should be a targeted goal. Thankfully, countless online sources have addressed this need with introductory twips (or tips for the unfamiliar), best practices, and metrics.

Profile stats can be found on Twitter-Friends and TwitterGrader among many others. These two sites in particular don’t require a password to access information, and both sites were recently blogged about here. TwitterGrader specifically provides an out-of-100 grade for all profiles. Since anyone can reference information for any profile, sites like these provide a quick side-by-side comparison of your profile and your competitors’ profiles.

Among a handful of automotive OEM profiles (found via Twellow) the front-runners according to TwitterGrader are @GMBlogs (with a total “Grade” of 99.8, and rank of 4,222), and @Alicia_at_Honda (99.5, and 3,162 respectively). Additionally, it appears that @Ford, @GMBlogs, @Alicia_at_Honda, and @ToyotaNewsRoom each return the follow gesture from each of the members of their flock, while @Chrsyler, @eMercedesBenz, and @NissanNews tend not to do so as much. If your utilization objectives for Twitter include an ear to the ground, following those that follow you is square one.

As for my selections in Third Party sites, @Edmunds grades the highest even though @KelleyBlueBook out performs all others by number of followers as well as how many profiles they follow. Profiles like @AutoTrader_com and @DealerAdvantage make strong statements by following more profiles than follow them. Furthermore, @Edmunds has tweeted a total of more than three times that of the next highest tweeter in this group, and maintains a decent sized following.

For a benchmark, here are TwitterGrader’s stack-up of some popular personalities on Twitter:

In any case, whether your company’s Twitter profile(s) is alive and healthy or still in its infant stage, keeping an eye on your stats as well as those of competitors can serve you well. At the end of the day what’s most important is not that you are using Twitter, it’s how you are using Twitter, and by monitoring profiles you can discover obvious successes of others and certainly points of twopportunity for your company.

I’m certain there are new tools surfacing daily – what other Twitter tools do you use?