Separating the Real Shoppers From the Window Shoppers on Your Dealer Website
Walking around my local shopping mall in 1998 was an experience that I enjoyed. In fact, most of us in the car business can remember the entertainment of walking up and down the storefront shops looking in the windows at the new merchandise. I was the quintessential 'window shopper' every time I walked by the now defunct Circuit City electronics store. I stared into their store window at the new digital cameras for sale. I can recall pressing my face up against the glass to get the best look. I am sure that I left a streak mark or two behind on the glass. I never went inside the store because I didn't have enough money, and while I wanted the camera really bad, I knew I couldn't buy it.
In the summer of 1998, I also had a lawn mowing business and made it my goal to buy a digital camera with my earnings. I spent hours mowing lawns and daydreaming about the day I could actually go buy the camera. After mowing what seemed to be a hundred lawns, I finally had saved up enough money to purchase a camera.
I watched the new cameras hit the window for weeks, and I was finally ready to make a purchase. As I entered the camera section, the excitement of the moment hit me. Today was the day that I finally was no longer just a 'window shopper' and could finally experience all of the cameras. I could touch them, take sample photos, and really decide what camera would be the best one for me. I liked the look of the new Canon, the Sony fit just right in my hands, but right before I was going to make a decision, the salesperson suggested that I took a closer look at the new Fuji FinePix. The Fuji was not on my shopping list, but the camera had higher resolution, better zoom, and just looked really cool. I was sold. As I was paying, the salesperson said he could predict that I would purchase the Fuji only by how I interacted with the camera and because it had been a top seller at the store for the last month.
I write about this experience because the way inventory managers and marketers today have to figure out how to spend their budget is still missing a lot of information on how a customer is actually interacting with our vehicles online. The traditional system is viewing every 'window shopper' as a would-be buyer. For at least the last ten years, automotive shopping websites have been attempting to predict shopper behavior and what vehicles would sell by tracking Search Results Page Appearances (SRP), or the activity of a vehicle populating in a list of available vehicles in search results. Sites also use Vehicle Detail Page (VDP) views as another indication that a vehicle is going to sell. The common thought is that the more times a vehicle is looked at online, the more likely it is to sell. The only issue is that SRP / VDP views are simply 'window shoppers' walking by the front window.
While both VDP and SRP metrics are helpful, there is a more precise way to determine when a vehicle is likely to sell and what actions to take to increase inventory turns and vehicle gross. Analytic data companies now have AI tools for car dealership sites that more precisely predict the chance of a car being sold than the traditional SRP and VDP metrics. By placing a tracking pixel on a dealership website, dealers can get much more information about the activity that shoppers are doing on their dealership website.
Take for instance, a fresh new Toyota Tundra trade-in that may have only been viewed two times by visitors on the website after fourteen days of having the vehicle. Most dealers tracking VDP clicks would likely start the process of marking down the vehicle so that it would be priced more aggressively and get more views. However, dealers with advanced AI know that one of the Tundra shoppers spent fifteen minutes interacting with the page, clicked on all the vehicle photos multiple times, scrolled the entire page, opened, and then closed the lead form. Best of all, they know that they have a shopper that is very interested in the vehicle and can actually raise the price — inferring that the customer may have been more than just a 'window shopper.'
Noah John, founder of Autoscores.com, states:
Instead of waiting a certain time period before adjusting vehicle prices, dealers can get daily advice on what they need to do. Stores have to pinpoint recommendations on what action to take next, such as raising or lowering the price, reviewing VDP/Listing, and inspecting the vehicle. Dealers can easily react to online signals and demand in near real-time.
When is the last time you can remember your vendor or software telling to increase a unit's price? By using more data points, stores can raise the car's price before the customer even shows up at the store. By increasing the price, you have a better chance to get shoppers that viewed the car to submit a lead, call, or visit the dealership. By acting instead of waiting, you can sell vehicles faster and at more profitable prices. Before the implementation of AI, this was nearly impossible to do.
Noah went on to explain that the studies his company has completed indicate that, "Aggregated customer click behavior analysis on a Vehicle Listings was at least five times more accurate than looking at VDPs / SRPs when trying to predict the sale of a vehicle in the next seven days."
Today's smart dealers are utilizing every piece of information; their website can increase both gross and turn. It is much more fun to work with the customers that are hot on a unit versus relying on the activity of the 'window shoppers.' For more information on how your dealership can take advantage of some of the new AI technology, feel free to contact me at [email protected].