CarNow‘s Senior vice president of Sales and Co-Founder, Tim Cox, joined Jim Fitzpatrick on the CBT Stage at NADA 2020 in Las Vegas to discuss how new technology is shaping digital retailing strategies for dealers.
VIDEO TRANSCRIPT:
Jim Fitzpatrick: Hey, we’re sitting here with Tim Cox. He’s the senior vice president and co founder of a company called CarNow. I know that you know that company and you know this gentleman because he’s been on CBT news. Thanks so much for taking the time out of your busy schedule.
Tim Cox: Absolutely.
Jim Fitzpatrick: You’re having a great show, right?
Tim Cox: Yes. Having an amazing show.
Jim Fitzpatrick: Fantastic. Vegas is always a great spot, right?
Tim Cox: It is. It is the best.
Jim Fitzpatrick: It really is. Talk to us a little bit about some of the things that you guys have going on at CarNow. I know you’re rolling out some things and new partnerships and new incentives and things. Talk to us about that.
Tim Cox: Absolutely. We’re announcing here at NADA, a brand new partnership with Facebook and it’s not just-
Jim Fitzpatrick: Wow.
Tim Cox: Yeah, kind of a little company. You might’ve heard of them, but no, seriously, in our continued effort to enhance the communication piece to the consumers, because at the end of the day, never is one car sold without at least one conversation.
Jim Fitzpatrick: That’s right.
Tim Cox: What we did… I don’t want to say this came over by mistake. I mean we were trying to continue to get better and better and better, but we took over CTAs schedule a test drive, get my E price and we did that with what we’re calling customizable AI trees to where we can deliver a direct message, whatever the dealership wants to deliver to that customer, a direct message to where they don’t even a lot of times have to type. The customer’s just yes, no and filling out these CTAs and what we found about eight months ago was astonishing. I mean, we knew that customers would respond well to it, but we did not know that they would respond that well to it.
Tim Cox: We literally saw in some cases, 133% increase and we have dealer after dealer and now we have several hundred dealers using these AI trees and call to action. I was giving this data in November at the David Kain event and Facebook happened to be there and Bob Lanham said, “Hey listen,” he said, “Messenger is blowing up for us in automotive right now, but the communication is not good.”
Jim Fitzpatrick: Wow.
Tim Cox: He said, “It would be great if you took those same AI trees and you would integrate with somebody like Xtime and you would integrate with their API to where literally a customer could go on a Facebook page with a few clicks, schedule a service appointment because I’ve heard people say that if you can get the customer into the service drive twice a year, that customer’s five times more likely to buy… Five times more likely if they’re servicing the vehicle in your dealership to buy their next vehicle at your dealership so we’re excited about it.
Jim Fitzpatrick: That’s a no brainer.
Tim Cox: It’s absolute no brainer. It’s an inexpensive product. It’s just another way that we can add ROI to the bottom line for our dealer partners.
Jim Fitzpatrick: There’s no question about it.
Tim Cox: Very exciting.
Jim Fitzpatrick: Right now, with every dealer suffering from margin compression and trying to run a more efficient dealership, every single sales opportunity counts. Nobody’s can afford the luxury of missing deals. This kind of falls into that category, right? Of capturing every possible transaction that you can by communicating the way the consumer wants to communicate.
Tim Cox: 1000% and that… With the whole DR phenomenon, everybody’s talking about digital retailing, digital retailing, digital retailing. Listen again, you got to have a conversation. Even our own DR tool, they’re in everybody. There’s a lot of great DR tools out there and they have… Everybody has dealers that are doing a great job, but those dealers are 100% committed. They have creative process around it. What we wanted to do is create these flows to ABC Toyota in a rural state that these flows and these AI trees took the customer all the way down one tree led to another, which delivered a satisfied customer to that dealer.
Jim Fitzpatrick: Sure. It’s bringing kind of that high tech approach to even, I don’t want to say mom and pop because it’s not fair to those dealers that have maybe a couple of dealerships as you said in a smaller market, but it allows them to compete just along with the big players out there in the automotive space, right?
Tim Cox: 1000% and that’s most of the dealers. I mean most dealers in the country, I mean you have your big Metro, but most dealers, it’s not mom and pop. Most dealers in the United States, they sell 100 cars a month. There’s nothing wrong with that because that’s who we are.
Jim Fitzpatrick: Yeah, but it allows those dealerships to really play on a level playing field when you give them that kind of technology.
Tim Cox: Absolutely.
Jim Fitzpatrick: Today it’s all about communicating with the customer the way they want to be communicated with. I know as a consumer, if somebody says, “Do you want a phone call? Do you want an email? Do you want a text message?” I’m all about texts. I don’t check my emails that much and I definitely don’t check my phone calls. If they have that opportunity to do that, you’re going to win my business.
Tim Cox: Absolutely. That’s why when we partner these together, it’s not one plus one equals two, it’s one plus one equals 11 because you really… You have to be able to communicate with the customer where they want to communicate with you.
Jim Fitzpatrick: That’s right. What kind of an impact does partnering with a company like Facebook? That’s such a huge platform-
Tim Cox: I can’t even imagine. Obviously we’re just launching this product. We were all in trying to get everything ready for NADA, but Bob Lanham obviously, and the team over at Facebook have been amazing to work with. It is very humbling to think that a company like that is talking about us and our products is amazing.
Jim Fitzpatrick: Absolutely. Being in the same sentence as Facebook is incredible.
Tim Cox: Yeah, yeah, yeah. It’s good stuff.
Jim Fitzpatrick: But they also… Selfishly, they want a more positive experience for their subscribers.
Tim Cox: 1000% so we’re looking at other aspects on how we can partner together, because again, everything is communication. If every… We’re human beings, we’re reciprocal and it’s frictionless. What we’re doing now actually is we’re actually in the Facebook dealer playbook and we’re going to try to… Well not try, we’re going to wrap around some processes as we continue to get this data, but wrap around processes so we can deliver ABC Toyota, or Chevrolet, “Hey listen, if you add our schedule now with Facebook, not only here’s the tool, but here’s some best practices that go along with it, kind of a to Z development.” We’re working closely with Facebook on that as well.
Jim Fitzpatrick: For sure. Today not that many dealerships deliver vehicles online, digital retail I’m talking about. Where will that be in 10 years. What percentage of deals, or customers that take delivery of vehicles will turn to their online experience versus going into a dealership in your forecast?
Tim Cox: Listen, I would love to sit here and tell you something dramatic and what we’re seeing even with companies like Carvana, that experience is not 100% online. You’re still doing paperwork.
Jim Fitzpatrick: I know.
Tim Cox: We were doing… We were selling cars like that in 1999 when I was a sales manager at a dealership. To make a bold prediction, I will tell you that I don’t think salespeople are going away. The type of salesperson I think is going to transition, being able to be a somewhat tech savvy, communicate with that customer in the way they want to be communicated. For example, you’re shopping for a car, your phone’s blowing up. Me, I mean obviously we have people try to sell us stuff all the time because we’re a pretty decent sized company and if I don’t know the number, I’m going to ask, but if somebody says, “Hey, this is Scott from ABC whatever,” then…
Tim Cox: We are texting people. That’s how we all do it now. We’re texting people to ask permission to call, right?
Jim Fitzpatrick: That’s exactly right.
Tim Cox: When we do that and we implement that… Again, the old school of just get them in, just get them in. It’s just changing the way. Are people are going to click one button and have a teleporter car? I don’t think so in 10 years. I think the human element, people want… It’s the America’s love affair with the automobile. It’s the excitement that comes with it.
Jim Fitzpatrick: We just got to tweak the experience.
Tim Cox: We’ve got to tweak the experience. This isn’t rocket science. Listen to me, we are not in the car business anymore. We are in the people business period. No matter what we’re selling, we’re in the people business and that’s why CarMax is doing what they’re doing and their PVR is $1,200 higher than a franchise dealer because it’s the experience. That’s what we’ve got to train dealers to do and give them the tools to be able to do it seamlessly.
Jim Fitzpatrick: I agree. Tim Cox. CarNow. You heard it right here, folks. You’re in the people business, not the car business.
Tim Cox: That’s exactly right. Thank you brother.
Jim Fitzpatrick: Thank you so much.
Tim Cox: Appreciate you, man.
Jim Fitzpatrick: Yep.
