AS a follow-up to my stinging article in the August issue, I recently had a meeting with a regional director of Auto Trader.
The fact that senior figures within Auto Trader were prepared to engage in anything other than rudimentary business calls is a credit to the company, but the meeting did nothing more than highlight why the majority of car dealers are so unhappy.
Our disagreement focused on the current pricing structure and the perception of value. Auto Trader say that their figure of around £9 a week per car is excellent value compared to spending £100 a week on a regional press title or in my case the cost of a used car display area.
They also argue that a number of pricing and analytical tools are available to me, they have the highest number of unique visitors AND I have a ‘trusted advisor’ (crappy corporate speak for a rep) to visit me and talk through my needs. The visit also involved the introduction of a ‘customer charter’. ‘We want to hear your feedback so that we can improve our service, very much like the NatWest initiative’.
‘My prediction is that, like BA, Auto Trader will lose their market position.’
I used to fly with BA but rarely do today. I liked the fact that I had a seat, that the cabin crew were polite and professional and that they had an excellent safety record. What budget airlines did was strip the offer down to the base level but the product remained the same. Now I find it very difficult to justify the difference. ‘But BA had a good year last year,’ said the director when I used this analogy.
My prediction is not that Auto Trader will cease to exist – I still have an account albeit reduced – but like BA they will lose their market position. It is not enough to assume that service and market dominance will ensure the success of any company. I am happy to pay more for Auto Trader than I would a competitor as I accept their current position as market leader – but not 10 times as much.
The irony of the introduction of a customer charter should not be lost on anyone. every dealer in the land is screaming for a reduction in price but will they listen?
Who is James Litton?
James runs theinternetcarlot.co.uk. He’s been in the business for 12 years and always has something to say about the industry he loves.
