Every dealer knows how crucial it is to make fast and smart decisions about their inventory management. Here to tell us how Manheim Express is bridging the gap to the digital wholesale vehicle marketplace is Derek Hansen, Vice President of Offsite Solutions for Manheim.
VIDEO TRANSCRIPT:
Jim Fitzpatrick: Derek Hansen, welcome back to CBT News.
Derek Hansen: Thanks, Jim. Great to be here.
Jim Fitzpatrick: Sure. You guys are making some bold moves over there at Cox Automotive. It’s such a great team and a great company. Talk to us about this Manheim. Manheim recently completed the national roll-out of the new Manheim Express Concierge Service. Man, that’s a mouthful.
Derek Hansen: Definitely.
Jim Fitzpatrick: What does this mean for dealers, and what service will this provide?
Derek Hansen: Yeah, Jim, thanks. You hit the nail on the head. We’re moving fast at Cox Automotive, and we’re moving fast at Manheim. It’s an effort to stay with our dealer clients, to help them improve their business, to drive better returns, to become more efficient. That’s what this service is all about. The Manheim Express Concierge service is, we heard that feedback from our dealers. They like Manheim Express. They like the disclosure. They like the industry leading 360 imaging, but they’re strapped for time. Right? We know dealers, time is at a premium. They’re focused on their retail clients now. More than ever you have to be obsessive about your retail clients. They want to take some of that back office work off their plate. We can be there for them with our concierge team. Our concierge team is exactly that. It is the ability for us to show up as a full-service partner in the wholesale space.
Derek Hansen: Our team shows up. They can walk the cars, image them, inspect them, and then come in and consult. Very much a performance manager type situation where they sit down with the clients. Talk through each VIN, VIN by VIN, and also work with our clients to understand the marketplace, to talk about pricing, to talk about the best strategy for that vehicle, and help them dispose of that vehicle in a timely manner.
Jim Fitzpatrick: That’s huge for a dealer.
Derek Hansen: Yeah, it’s great. It’s been very well received. We’re excited. We’re now coast to coast with our concierge team, and the reception has been fantastic.
Jim Fitzpatrick: Wow. That’s a lot of boots on the ground. That’s for sure.
Derek Hansen: Indeed. Yeah.
Jim Fitzpatrick: Yeah. What prompted Manheim to add this service?
Derek Hansen: Yeah, it was very much the response of our clients. They liked the format. They see that wholesalers progressing digitally. It’s much more efficient. Cuts down on the holding costs. Cuts down on transportation costs. The ability to sell the car from where I’m at is where the industry is heading. We lead that march as the industry’s largest digital marketplace. Over 2 million transactions sold last at Manheim to a digital buyer. As we continue to evolve our digital offerings in our digital marketplace, the feedback from dealer was, “That’s great. Can you send someone to help me?” That’s exactly what the concierge team is, and that’s where the idea came about. Given the reception we’ve heard, we’ve got behind it, and we’re now coast to coast.
Jim Fitzpatrick: Sure. Drill down a little further. How is the wholesale digital marketplace evolving?
Derek Hansen: Yeah, it’s evolving as technology evolves. We’re seeing that dealers are in a place where margins are being compressed. They’re looking for every avenue and every opportunity to reduce cost, and digital provides that opportunity in the wholesale space. Additionally, technology is improving to where buyers can have more confidence in that vehicle as a digital listing. The imaging is better, descriptions are better, tagging. I can highlight the damages. The buyers can now assess the true value of that vehicle in a way that they couldn’t even a few short years ago. We’re seeing that in the adoption of our digital transactions.
As I mentioned, over 2 million last year. We ended the year at 46% of all the cars sold at Manheim were sold to a digital buyer. Increasingly it’s more and more of everything we do, and Manheim Express provides that cutting edge technology to disclose the car in a new way with that 360 imaging, to have the leading condition report in the digital space, and provide that confidence for our buyers that they can now engage in way and engage in inventory that’s in their backyard. Right? That’s easier for them to get to, to source, to then retail for their own retail auto.
Jim Fitzpatrick: Looking down the road a bit, I say a bit, five, 10 years from now, do you see a day that maybe 95 or greater percentage would be done online?
Derek Hansen: I certainly think we’re going to continue to progress in that direction. It’s hard to say what bar we’ll hit. I know we expect this year to cross 50% with Manheim. We’ve seen double-digit growth on that digital side of the house every year for the last five years that I’ve been involved.
Jim Fitzpatrick: You guys are taking all the guesswork out of it.
Derek Hansen: That’s right.
Jim Fitzpatrick: Now a dealer can away with a tremendous amount of confidence. Right?
Derek Hansen: That’s right. That’s what Manheim has built on. Manheim has a marketplace. We’ve been around 70 years, and it’s that trust and confidence as a partner to the dealer. Right? Because it’s not just the front end of the listing and the images, but it’s everything that comes behind that. Right? Title, payment, arbitration, all of that. Manheim has been the premiere partner. Right? We are the leading wholesale marketplace. We come with 70 years of experience and partnership with our dealer clients, and that all transfers into the digital marketplace that Manheim presents and transfers in as a key part of Manheim Express. We are that partner that you worked with for generations to dispose of your wholesale inventory or acquire wholesale inventory, and now we’re doing it in a way that is better than ever before and doing it with boots on the ground that can come right to your lot.
Jim Fitzpatrick: Maybe picked up your phone as many dealers will do that.
Derek Hansen: That’s right.
Jim Fitzpatrick: Just go I got an app for that.
Derek Hansen: It goes through here.
Jim Fitzpatrick: Boom, boom, there’s the car. Okay, I’ll take it. Let’s go and move on. Right?
Derek Hansen: That’s right.
Jim Fitzpatrick: Yeah, that’s incredible. Are dealers embracing this new technology?
Derek Hansen: Definitely, yeah. We’ve had over 10,000 dealers sign up for Manheim Express, and it continues to grow month over month. We launched Manheim Express nationwide the end of last summer. It was the beginning of August. We launched this team as we heard that dealer feedback starting in October/November. We’re now coast to coast starting in 2019. Like I said, we’ve had over 10,000 dealers login, sign in, and use Manheim Express over that period, and we see it continuing to grow month to month, so we’re excited.
Jim Fitzpatrick: What changes to the digital marketplace do you anticipate we’ll see in 2019?
Derek Hansen: Yeah, we’re continuing to respond to our clients’ feedback. Right? Our clients say they want to hear more about the car. We have technology now we can provide engine noise, audio/video. Our clients say they want to be able to speed up that process for disclosure and get more consistent the condition. We’re pushing down a path where we’re using the technology to recognize damage. You’ll start to see that aid in the condition report. It’s almost like weather radar. Right? As you start to look at a car, it’s starting to react with AI and bringing you the condition of that vehicle. There’s a lot of exciting enhancements that are coming throughout 2019 and beyond. We’re committed to continue to lead the wholesale space, and we’re making investments to be the digital leader in that space.
Jim Fitzpatrick: You’re taking all the guesswork out of it for the dealer.
Derek Hansen: That’s right.
Jim Fitzpatrick: No longer does a dealer need this seasoned person sitting there making these decisions on the cars that for so long it was kind of a gut reaction whether or not the car was a good car, if it’s been hit, if it’s not been hit. If there’s work been done on the car, if it needs work. That’s very exciting.
Derek Hansen: That’s right.
Jim Fitzpatrick: Literally you can put somebody in place now that can … You’re a click away, and you got the right car, and of course backed up with the confidence of Manheim. Right?
Derek Hansen: That’s right. Yeah. It’s all about confidence and trust in the process and in the transaction, so that dealers can be as streamlined and as efficient as possible, focused on their retail business, focused on driving a better bottom line performance. That’s where Manheim comes in, and Manheim Express especially is that path to cut the costs, keep their margin and continue to grow the business.
Jim Fitzpatrick: Keep the person that’s making those decisions in the dealership making more money and not flying all over the place trying to get cars and coordinate it and the whole deal, which can be a real pain in the neck for a lot of dealers.
Derek Hansen: That’s exactly right, Jim.
Jim Fitzpatrick: Well, Derek Hansen, thank you so much for joining us on the CBT News. Hopefully, we can have you back in a couple months to talk about how this thing is rolling out even with more … You’re at 10,000 now, which is amazing. You’re half-way through all the dealers that are out there.
Derek Hansen: That’s right, Jim. We appreciate you having us and look forward to being back, so thank you for the time.
Jim Fitzpatrick: For dealers that are watching right now, please jump on and look into this. You heard Derek talk about it today. This is something that certainly is going to be able to save you time and money, and why not do that? That’s what every dealer is pressed for right now is time and money and wanting to make more of it. This is a way to do just that. Thanks again. Appreciate you coming in today and sharing this information with our audience.
Derek Hansen: All right. Thank you, Jim. Appreciate it.
Thank you for watching the official news source of the retail automotive industry. This has been a JBF Business Media production.
