What 3rd Party Lead Provider Wins?
One of the most common questions we get when auditing Digital Spend, is who generates more leads, Autotrader, Cargurus, or Cars.com.
Typically I would suggest an analytics audit before making any specific judgement calls for any Dealership. This will give us a better understanding of what types of vehicles are getting attention from the 3rd parties and which are being ignored. So without that specific audit data, my answer will be more broad and less specific to your situation.
When did 3rd Party Lead Providers Rule the Internet?
In February of 2013 Autotrader was the undisputed traffic king. This particular report uses Google Trend data to measure from 2004 forward the popularity of search terms and websites. Based on this data we can see that Autotrader reached a score of 100. This was the peak of their online popularity.
Cars.com sat at 30% of the size of Autotrader but had lost some ground since February of 2010 when they were 35% of the size of Autotrader. At this time, CarGurus was a mere blip on the radar at 9% of the size of Autotrader.
So what drove Autotrader to the heights it reached in 2013?
Why did they fall?
What brought Autotrader back down to earth? In one word, Google:
Within 30 days of Autotrader reaching their peak, Google announced that they were going to actively try to drive customers to their search website over the 3rd party lead providers.
What few dealers realized at the time, was much of the traffic Autotrader and cars.com drove to their websites, was directory traffic. In other words, they captured the lion share of searches like: “Car Dealership Near me”, or Car Dealer Tampa”. By June of 2014 Google streamlined their Google My Business offering.
The Slow Crash
Chip Perry resigns as CEO. The only CEO Autotrader had known announced he was resigning in April of 2013. https://www.autonews.com/article/20130325/OEM02/130329934/autotrader-ceo-perry-to-resign-may-1
With Google seizing control of the web traffic. There were rumors floating around that Autotrader and attempted and failed to sell their automotive inventory product to google and could see the writing on the wall.
The Rise of Cargurus
With Autotrader and Cars.com reeling from the changes in the google search algorithm. The biggest being people looking for local dealers were being directed either directly to the dealer’s website or they were being sent to map results with phone numbers and website links, less people were coming to autotrader and cars.com.
It was around this time that a new player with a new strategy began to enter the market, Cargurus. Instead of focusing on Dealer directories to bring in traffic. Cargurus instead built the most accurate used vehicle directory on the internet.
Within months they owned ever used model based search in google. Google rewarded them for providing an easy to navigate directory and Cars.com and Autotrader took the brunt of the losses.
The Last Few Years
With Google Local grabbing much of the traffic the 3rd party companies used to capture in 2013. The fight has turned to used model searches in an attempt to continue driving leads. With much less search volume CarGurus has jumped ahead of Autotrader and Cars.com in search volume. This doesn’t mean that cars.com and Autotrader do not generate leads, they are just not generating them at the levels they were in 2013.
The Internet has continued to grow since 2013 but with Google emphasizing individual dealer websites and google map listing, Dealers are feeling the growth instead of 3rd party listing companies. Because of this, the pressure is on for them to retain clients and justify their offerings. To do this, they are attempting to add new inventory and marketing packages in order to bolster their offerings.
I would highly recommend, taking a close look at your traffic and lead count, and always remember there are still people paying for AOL dial up.