I found out recently that one of my clients was strong-armed into signing a brand new Autotrader contract for the group just 7 months into their current agreement. Now, it does state in the Autotrader contracts that either party may terminate the agreement at any time after the initial 90-day period, but just because it’s legal doesn’t make it right. Or good for business, for that matter.
I’d certainly love to hear Autotrader’s rationale behind forcing clients into new, more expensive contracts before their current ones have expired. And not their rationale to the clients, but rather the rationale to themselves.
It takes some real salesmanship to make this execution come across as anything other than a big fat slap in the face to dealers, and I haven’t met an Autotrader rep in a long time who has that kind of salesmanship. Where is the logic here? Every year, Autotrader pisses off more and more dealers by raising prices and providing less return: their site becomes more saturated with competition every year, they stuff as many third party ad banners as possible into the pages, and other U/C classified listings (many of them free) are making more and more progress all the time. So with all that taken into account, who was the genius at Autotrader who decided, “you know what… let’s not just raise our prices again, but this time, let’s invalidate everyone’s current paperwork and start gouging them right away”?
I heard a lot of the b.s. that corporate shoveled to their reps as canned excuses (fyi, the word “excuses” may have been substituted with the phrase “product enhancements” by your local Autotrader rep), and as usual, none of the excuses justify increasing the price, let alone doing it so abruptly. It’s really come to the point where part of my consulting with dealers involves thinking up solutions to get around using Autotrader. Every few months, those solutions get more and more appealing, and Autotrader edges ever closer to having to take their business model back to the drawing board. I’ve got the champagne on ice for that day.
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They are doing this out of pure greed. They have a churn rate nationally of about 25% per year. With the current economic situation and the fact that some domestic dealership name plates are shrinking, this means considerably less revenue for autotrader, so guess who foots the bill! Existing accounts with them do!. All the good sales folks who actually cared about helping dealers with their business have left autotrader within the last year or so, they pushed a really draconian pay plan on their sales staff last Summer and the good veteran sales folks left in droves I’ve heard. The sales people now remaining are primarily paid on new business revenue generation almost exclusively and receive no compensation for retention of accounts, pretty stupid. Wanna laugh really hard? Call their toll free customer service number for their home offices in Atlanta, you’ll want to kill yourself afterwords. So many dealers are pissed off at them. Pump up your own dealership website and find a reliable company to assist you in building effective organic google optimization, you’ll get the same amount of eyeballs on your dealership inventory and save yourself about $125,000 a year at the same time!