AutoWeb sells Web traffic -- but it's not stopping there
There’s another Web traffic source for dealers to use.
Miami-based AutoWeb is an online search company that allows dealers to see which vehicles potential shoppers are interested in.
The company was co-founded in 2013 by Matias De Tezanos, Jose Vargas and Julio Gonzalez Arrivillaga.
It posts ads across a network of automotive-related websites and apps, which in turn generates consumer traffic, which is then sold.
AutoWeb has 71 employees with plans to hire more in the next 12 months. The company also has plans for regional offices in Los Angeles and to upgrade its Detroit office.
This is not the first startup for AutoWeb’s three co-founders.
The businessmen have started, scaled and exited successful ventures such as Hoteles.com, which was acquired by Expedia, ClickDiario Network, which was acquired by Newscorp, and BrokersWeb, which was acquired by Vantage Media, among other startups.
“It’s the most exciting [startup] we built,” said the 35-year-old De Tezanos, AutoWeb’s CEO. “It has all the elements of technology, trends and a team.”
De Tezanos said he considers AutoWeb’s finances to be stable. The company expects to generate more than $10 million in revenue this year.
“AutoWeb is very well capitalized as we have had a number of accomplishments during our first year of operations thanks to the support of our investors to build long term value,” De Tezanos said in an emailed statement. “In addition, AutoWeb closed a $6.4 million Series B (private investment) in November 2014 and more details of this round will be announced by the company in the next few weeks.”
AutoWeb’s first partner was California-based online marketing firm Autobytel Inc., which gave AutoWeb a $2.5 million investment. De Tezanos noted that AutoWeb is in conversations with other big names in the industry to partner with.
Part of the reason is because of how attractive AutoWeb has become in a short amount of time.
“Over the last 12 months we’ve been averaging 1.5 million searches per month,” said De Tezanos. “The number has been growing significantly and we expect it to keep growing.”
AutoWeb has surpassed internal projections, according to De Tezanos, and is performing better than his other startups were in a similar amount of time.
Not in competition
De Tezanos said that AutoWeb is not around to compete with the big names in online car shopping, such as TrueCar, AutoTrader.com or Edmunds.com.
He said that those companies actually buy traffic from AutoWeb and mentioned that TrueCar is a “happy client.”
TrueCar could not confirm whether it buys traffic from AutoWeb but did acknowledge that buying Web traffic is part of its business.
“While we constantly monitor and test dozens of publishers and traffic partners each month, this type of digital marketing acquisition is a very small portion of our broader marketing strategy,” said Carly Schaffner, a spokeswoman for TrueCar.
According to De Tezanos, third-party sites buy the traffic on a pay-per-click basis. The more clicks the company gets, the more money it makes.
Working with dealers
It’s the same way when AutoWeb works directly with dealers.
De Tezanos noted that AutoWeb is working with around 100 dealers and counting, up from zero a couple of months ago.
“Our traffic comes in at a lower cost than Google and it’s just as good,” said De Tezanos.
The company’s website, which is still in beta mode, allows shoppers to use search criteria including preferred monthly payment, vehicle type, make and model and MSRP.
AutoWeb also has a presence on social media including Facebook and Twitter. The bigger its presence becomes, the more traffic it’ll be able to sell.
“Our users quickly find the car that best suits them, share it with friends and have fun searching for their new car in a way that, until AutoWeb, hasn’t been possible,” said Charlie Schiavone, AutoWeb’s general manager of product.
De Tezanos said that all this user data are tracked for trends.
AutoWeb also has plans to expand to offer a used-car search in the near future.
“Clients have been asking for used car traffic,” said De Tezanos. “Used cars will open up the search volume. It’s exciting.”
On Feb. 10, AutoWeb launched the editorial side of its website.
The editorial site features reviews, advice, news and trends in the automotive industry.
“Searching for a new car or truck can be an overwhelming experience,” said Michael Harley, AutoWeb’s editor-in-chief, who came from Autoblog. “Our goal is to educate consumers and give them the tools they need to make educated decisions when it is time to look for a new vehicle.”
AutoWeb also noted that the editorial site is completely banner- and ad-free.
Much like AutoWeb itself, users can share editorial content across social networks.
Harley said there will be a staff of five freelancers based in Los Angeles, Chicago and Detroit.
“There are countless sites with reviews,” Harley said. “We don’t want to be another site.”
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