TrueCar Inc. spent the past two years rebuilding relations with dealers. Now the vehicle-shopping site is turning its attention to automakers to boost sales.
TrueCar is forming a council of manufacturer executives, similar to its dealer council, to advance its Live Prospect product, TrueCar President John Krafcik said.
Live Prospect enables the 13 participating brands to send targeted incentives or coupons to shoppers as the consumers configure vehicles on TrueCar and its affinity partner websites, or after they have downloaded guaranteed vehicle prices from TrueCar-participating dealers, Krafcik said.
The coupons are meant to entice the shoppers enough to buy. As TrueCar does with participating dealerships, the company charges carmakers a fee only if the coupon results in a sale, Krafcik said.
He declined to name the fee. Dealers who convert TrueCar shoppers into sales pay $299 per new vehicle and $399 per used vehicle sold.
Last year, Live Prospect accounted for just around $13 million of TrueCar's $206.6 million in revenue. But the company plans to grow it.
Krafcik, who was interviewed after TrueCar's fourth-quarter earnings call last week, said his company is enlisting an "OEM council" to help TrueCar refine the program and its fees.
Krafcik said Live Prospect could help carmakers spend more efficiently on incentives. Automakers' annual U.S. incentive spending totals about $45 billion, dwarfing the $20 billion per year that they spend on advertising and the $10 billion per year that dealers spend on advertising, he said.
TrueCar has been rebuilding its dealership roster in the last two years after it resolved regulatory concerns over advertising and alleged brokering of vehicles.
TrueCar's fourth-quarter revenue jumped 38 percent to $55.5 million. Its net loss based on generally accepted accounting principles widened to $9.8 million; under non-GAAP measures, earnings were $277,000.