I send this message as a true friend in the automotive industry. As
some of you already know it is my mission to help dealers be
profitable and grow their results.
I wanted to reach out to you and send you this message to inform you
of what has been going on with Zag.com/TrueCar and the current
I know that a lot of dealers are using Zag.com because they are sold
on the fact that they never pay for a lead and only pay $300 for when
the car gets sold. The problem is that we give out access to our data. Zag and TrueCar
pull all of our data including front end gross, trade value, and back
end gross. Since they go into the database they pull information for
every deal that you did that month.
Now let's think. Let's hypothetically say that you had an issue with
a deal. I am talking about an issue where a customer was misquoted
severely to the point where you had one deal that you literally lost
$2,000 on. This happens at some point or another. Well now you let
Zag know of that information. They take that low price and post it on
TrueCars.com as the best price out there. Now you have customers
expecting to go into dealerships (including yours) to pay that
unrealistic low price. This takes competition to a whole new level.
So I ask. Why do we want to let a vendor take our data and use it
against us. Let's face it, Scott Painter (CEO of TrueCar) has never
worked in a dealership or experienced the pain that we all had selling
cars and dealing with struggles. He actually has been quoted saying
that he envisions this industry eliminating sales people with this
process. Here is a man that is out to give consumers transparency
while hurting out business. I believe in being fair, honest, and
showing transparency. I do not believe in auto dealers getting hurt
to do it. We should be playing on even field. If Zag/TrueCar were
posting realistic figures allowing dealers to make a profit we would
not have any problems.
Check out this Automotive News Article: http://bit.ly/vbMAim
Here are some more important resources for you to look at: http://bit.ly/jNtK8M
The bottom line. The automotive business has been great to me. I
created a solid career out of it. I learned skills in this business
that I would never learn anywhere (including college). I have made a
decent living at it. I started Dealer eTraining to give back to the
industry and help better our industry by providing training solutions.
When I see a company get started that hurts our industry I care and I
want to see it go away.
As the saying goes, "there is no such thing as a free lunch". If you
are using Zag because you like the fact that leads are free and you only pay
for the lead when the car gets sold you need to consider the damage
that you are doing by losing money on these deals and letting Zag use
your data to make you look bad in front of your customers as well as
create more tension between competing dealers. Let's put an end to
this madness. I propose that whoever is using Zag/TrueCar stop using
them and pass that on to everyone including your competitors.
But wait, this gets better. Did you know that DealerTrack has stake in this? Yes, DealerTrack and ALG are involved (http://bit.ly/vKu1VU). That is right, a company that is supposed to be a dealer partner got involved. I wonder how much more date is getting leaked in to TrueCar to hurt our business.
If you look at the facts you will see that you need to stop using Zag/TrueCar. I have been saying this for a few years but now I am really speaking out loud about this.