GM dealers eager to load more vendors for websites
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October 28, 2019 12:00 AM

GM dealers eager to load more vendors for websites

Lindsay VanHulle
Hannah Lutz
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    General Motors dealers say the automaker's decision to allow more than one company to build dealership websites will lower costs, increase leads and foster much-needed competition.

    It's also an indication that GM is listening to their feedback, the retailers say.

    GM's preferred vendors

    Links to the 4 providers' packages can be found at gmdealerdigital.com/websites.

    CDK Global Inc., Hoffman Estates, Ill.
    Pitch: As GM's exclusive legacy provider, it offers continuity with more flexibility to design options than before

    Dealer Inspire (Cars.com subsidiary), Naperville, Ill.
    Pitch: Integration with online chat and digital retailing tools; access to broader Cars.com audience data

    Dealer.com (unit of Cox Automotive), Burlington, Vt.
    Pitch: Access to Cox's suite of brands, including Autotrader and Kelley Blue Book

    DealerOn, Rockville, Md.
    Pitch: Deep focus on websites, search-engine optimization and search-engine marketing to convert website traffic to sales

    GM last month said its Chevrolet, Buick, GMC and Cadillac dealers will be able to choose from four website providers in 2020, expanding beyond dealership software giant CDK Global Inc. as its exclusive website provider. The automaker notified dealers in January that it was ending the exclusive relationship with CDK. CDK will stay on as one of the four, joined by Dealer Inspire, a subsidiary of Cars.com; Dealer.com, part of Cox Automotive; and DealerOn, which is independently owned.

    "This initiative is designed to provide flexibility and choice to help dealers sell more vehicles, parts and services through digital channels," GM spokesman Dan Flores told Automotive News. "These efforts are in response to our dealers asking for more choice in the dealer digital space."

    The change is sparking a flurry of marketing activity as the approved vendors pitch dealers on their offerings. And dealers say they anticipate the expanded choices will lead to lower prices and more efficiency. That's particularly true for GM retailers who had used more than one website provider — either because they also sell vehicles from other automakers or they maintain two websites for their GM stores.

    McCluskey: Move will invigorate

    Keith McCluskey, CEO of McCluskey Chevrolet, near Cincinnati, added a website hosted by Dealer Inspire about six years ago alongside his CDK-hosted site. The Dealer Inspire site looked distinct from those of other Chevrolet dealerships in his market, and its search-engine optimization capabilities seemed better, he said. The Dealer Inspire site produced more leads than the CDK website, he said.

    "We now finally have again some choices that I think will invigorate people," said McCluskey, a member of the Chevrolet National Dealer Council, who added that he plans to make Dealer Inspire his primary provider. "If nothing else, it gets them rethinking about the look and feel of their website."

    New entrants

    Last month, GM launched a 10-city digital dealer summit tour that continues through November. Dealers can learn about each website provider's product and meet representatives from the companies.

    All four companies are working to differentiate themselves to dealers in the market for a new vendor.

    Pastore: Leverage Cox brands

    Dealer.com, which Cox acquired when it bought Dealertrack in 2015, can leverage other Cox brands, including Autotrader and Kelley Blue Book, for its website clients, said Wayne Pastore, Dealer.com general manager.

    Pastore said Dealer.com hosted about 400 secondary websites for GM dealerships.

    DealerOn, in Rockville, Md., said about 100 of its 3,000-plus dealership customers use it for secondary websites for GM stores. Mike Martinez, chief revenue officer, touted DealerOn's "deep and single-minded focus" on converting website traffic to sales.

    That means focusing on what it does best — websites, SEO and search-engine marketing — while leaving digital retailing tools to other providers, Martinez said.

    Dealer.com and Dealer On declined to disclose how many additional dealerships they're targeting. Dealer Inspire aims to initially attract 1,250 GM dealerships, including the roughly 150 that already use Dealer Inspire for a secondary website, CEO Joe Chura said.

    Dealer Inspire, which Cars.com bought last year, is promoting its online chat and digital retailing tools that integrate with Cars.com's audience data, Chura said.

    The three new entrants intend to siphon some of CDK's market share. CDK Global, through its predecessor companies, has been GM's exclusive provider since 2004, when GM hired the former Cobalt Group to manage dealership websites, according to the company.

    CDK touts its years of experience working with GM as an advantage, along with continuity that will minimize disruption for dealers. CDK also says it will have more flexibility to design packages for dealers than in the past.

    Cole: “Ready to compete”

    CDK remains GM's exclusive provider until January, when dealers will begin to move to new vendors or into CDK's new packages, said Jennifer Cole, senior vice president for CDK's digital business.

    "We're ready to compete for the dealers," Cole said.

    In June, after losing the exclusive GM contract, CDK said it would sell its digital marketing business, which includes dealership websites. CDK this summer said its digital business will continue without interruption as it looks for a buyer.

    GM business was up to 80 percent of revenue in CDK's marketing segment, said Gary Prestopino, managing director at Barrington Research in Chicago. GM's decision to end the exclusive agreement would lead to a significant hit to CDK's digital marketing business, he added.

    Cole said losing GM's exclusivity "certainly put us in a position to focus on what we needed to do to ensure that we could compete for dealers. Knowing that this change was coming has driven us to really ensure that we make the investments around what dealers care about most."

    That includes more creative content, faster turnaround times, speed and SEO, she said.

    CDK declined to say how many GM dealerships it expects to retain.

    Healthy competition

    Several dealers and website providers said GM is following many other automakers that opened up more choice.

    "GM, by doing this, obviously is looking to diversify the business and probably is looking to get a better price than what they're getting right now," Prestopino said.

    Adding potentially thousands of dealerships to the portfolio won't be a problem for the new providers, he said, adding: "It's all not going to come to them in one big chunk. They're going to gradually win the business."

    Todd Ingersoll, CEO of Ingersoll Automotive in Danbury, Conn., and chairman of the national dealer council for Buick and GMC, said the competition is healthy. He said he intends to retain CDK as the website provider for his three stores in Connecticut and New York, and he predicted CDK will get more efficient as it competes.

    "A lot was learned while we worked with one vendor," said Ingersoll, whose stores sell an average of 475 new and used vehicles each month.

    "It became clear as time went on [that] to have multiple vendors not only brought the latest and greatest in technology, but also competition to make sure that everybody was staying leading-edge."

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