Page 10 - 2018 On the Move Issue 3
P. 10

Best Practices

      Merchandising New Cars: Is It Worth It?




      By Cox Automotive


         hrough years of experience we know
      Tthat great merchandising yields great
      results on used inventory, but many dealers still
      show signs of disbelief that it will lead to similar re-
      sults for new inventory. While it is easy to argue that
      new vehicles are basically commoditized – that they   multiple  real  photos  of  each  new
      are the same and consumers will not need to be sold   vehicle is by far the biggest positive
      through pricing, multiple real photos and comments   merchandising difference and the value is likely to
      on new-vehicle listings – hard data involving vehi-  outweigh the relatively low per-vehicle cost of taking
      cle detail page (VDP) views shows this argument is   at least 10 photos each of new vehicle at your deal-
      unfounded.                             ership. Real photos of new inventory prove you have   based on merchandising strength to gain the shop-
                                             that vehicle, encourage shoppers to envision them-  per’s interest. For example, because data show that
      Research has shown that new vehicle listings which   selves in it and make it less likely that a shopper will   shoppers are more likely to engage with well-mer-
      include multiple custom photos, comments and pric-  leave your VDP to find one with more pictures.  chandised vehicles,  Autotrader’s search results are
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      ing, generate more VDP views than listings without                            now not only based on shopper search criteria, previ-
      these critical components.  And VDP views are a key   If seller’s notes are viewable in the search results   ous shopping behavior, price and distance of vehicle
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      performance indicator because they help account for   page (SRP) on your website and the third-party sites   to the shopper, but also on merchandising. Dealers
      the 57% of new-car buyers that walk into the dealer-  you advertise on, they also can make a difference.   can ensure their vehicles rank higher on the SRP by
      ship without submitting a lead beforehand. 2  New vehicles with comments have shown a 27%   making sure they are well-merchandised with quality
                                             increase in VDP views compared to vehicles without   photos, video, vehicle details, custom comments, and
      One of the easiest aspects of merchandising is adding   comments.  Writing interesting vehicle comments   pricing. Finally, if you aren’t effectively merchandis-
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      prices to new-vehicle listings, yet today many dealers   from scratch can be a time-consuming exercise,   ing your used inventory today, it is time to start: VDP
      do not price their new inventory online. On Autotrad-  which requires a gift of creativity not everyone pos-  views increase at an even faster rate for used inven-
      er, there were 16% more VDP views per listing on   sesses, but the good news is many inventory market-  tory than new inventory with better merchandising.
      new inventory when the vehicle was priced versus   ing software solutions offer comment-building fea-
      not priced.  Whether this lift is because consumers   tures that make this process faster and less painful.
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      think dealers are hiding something by not displaying             Article Highlights
      a price or they gravitate toward competing listings   Merchandising your new
      that show more information, it is clearly important to   inventory with pricing, real    1.  While it is easy to argue that new vehicles are basically commoditized – that
      price all inventory.                   photos and comments will   they are the same and consumers will not need to be sold through pricing,
                                             give you a leg up on the   multiple real photos and comments on new-vehicle listings – hard data in-
      Not all dealers agree that spending more in adver-  competition because few   volving vehicle detail page (VDP) views shows this argument is unfounded.
      tising costs per vehicle to get photos of new inven-  dealers do all three. These
      tory is worth it. However, on Autotrader, there were   merchandising  tactics  work   2.  Research  has  shown  that  new  vehicle  listings  which  include  multiple
      99% more VDP views per listing when a new vehicle   in concert with each other,   custom photos, comments and pricing, generate more VDP views than
      had multiple custom photos versus no photos, 156%   giving dealers the most im-  listings without these critical components. VDP views are a key perfor-
      more compared to a stock photo, and 88% more   provement in VDP views per   mance indicator because they help account for the 57% of new-car buy-
      versus a single custom photo. Even a single custom   listing to drive interest and   ers that walk into the dealership without submitting a lead beforehand.
      photo versus a stock photo performed 36% better.    engagement  among  shop-   3.  Dealers need to ensure that they are merchandising their new vehicle
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      The number of custom photos on new-vehicle listings   pers when used together.   inventory with pricing, real photos and comments. These merchandising
      also has an influence. For instance, VDP views per   Not only will your efforts will   tactics work in concert with each other, giving the most improvement in
      listing increase 36.2% if the listing includes 40+ ve-  boost your VDP views, they   VDP views per listing to drive interest and engagement among shoppers
      hicle images.  Including that many photos on each   will also increase your rank-  when used together.
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      new vehicle may not be cost effective, but every little   ing in SRPs on sites like KBB.  1.       Netezza Tables 1/01/2018 through 3/31/2018
      bit helps. The increase in VDP views per listing with   com, which rank vehicles   2.       2018 Car Buyer Journey Study, Cox Automotive
                                                                                       3.       Netezza Tables January 2018
      8   www.maada.com                                                                4.       2017 SRP Hot Spot Test
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