When Vendors Stop Competing, Dealers Stop Winning
Dealer groups routinely create competition among salespeople, managers, lenders, and inventory acquisition teams. Yet many groups eliminate competition from one of the largest drivers of lead generation and vehicle sales: their website and marketing technology vendors.
The result may be costing dealer groups millions in lost revenue and missed optimization opportunities.
Fact: Automotive marketing managers and CMOs, who are responsible for multiple retail rooftops, have too much on their plate. Their ability to understand online marketing, websites, analytics, technology, and related subject matter results in dealership executives throwing additional tasks on their plate like compliance, KPI management, data integration, CDP projects, and now AI.
The Simplicity Trap
In an effort to simplify operations, many dealer groups adopt a “one vendor” strategy across websites, chat tools, digital retailing platforms, and marketing agencies. This mindset is most clearly seen with dealer websites.
Imagine owning 70 dealerships and using only one inventory acquisition source because it is easier to manage.
No dealer executive would do that.
Yet many groups use only one website platform, one chat provider, or one digital agency and assume they are getting the best performance without any benchmark for comparison.
I believe that this mindset has compromised growth and insights within dealer groups. Not all marketing directors have this mindset, but it is very common. It’s a blind spot. I hear it every month speaking with leaders who want to improve their online conversion rates.
In recent years, I have been working on projects to normalize dealership website engagement and conversion data. It is now clear to me that controlled competition is needed to optimize online marketing performance.
When I talk about controlled competition, I am not talking about the one Maserati or Alfa Romeo website platform which is different and the other 99% of group websites are one vendor. I’m talking about testing stores which have underperformed, but should be doing much better, but everything you have tried has failed to revive leads.
Since KPEYE automates online performance metrics, across all vendor tech stacks and OEM brands equally, dealers can finally see that some website platforms and tools perform better with certain OEM brands. I’ve rarely seen one vendor perform in the top position across all OEM brands.
For the first time, platforms such as KPEYE allow dealer groups to normalize engagement and conversion metrics across different website platforms, agencies, and OEM brands.
Create A Controlled Competition Model
To optimize dealer profitability generated by online sales and marketing investments, dealers need a new mindset:
- Step 1: Standardize measurement (i.e, KPEYE)
- Step 2: Allow multiple qualified vendors
- Step 3: Publish performance scorecards
- Step 4: Review performance quarterly
- Step 5: Expand winning solutions
This framework does not increase operational complexity. It increases accountability.
Typically, vendor are hired and fired based on feelings, unclear expectations, or changes in leadership. Sadly, some of the best vendors get tossed because the lack of clear performance metrics.
Let’s Start With Websites
Many dealer groups tell me they pick a website platform because they only want one website company to call for support. One CMS for their team to learn to manage website updates. This sounds good on the surface, but my data shows it can be a very costly decision. More costly than anyone has discussed or even documented.
If the dealer group has this “one platform” mindset, it limits website choices. For example, it might lead a dealer to feel that they have three choices: DealerOn , Dealer.com, and Dealer Inspire since they have the highest number OEM approvals. But what about Dealer eProcess, Team Velocity, Motive, or Team MXS?
But what if I told you website platforms do not perform the same on all OEM brands?
Dealer groups that carefully inspect their online data are discovering that a single-platform strategy is rarely the fastest path to improved conversion rates. Today dealers can leverage insights from KPEYE which were not surfaced before. Using KPEYE’s standardized conversion measurement framework, dealers now have confidence to test other website platforms.
They also have the flexibility to change CTA button text and conversion tools (i.e., trade tools, payment tools, credit tools) because once their conversion and engagement data is normalized, changes can be tracked, measured, and conversion rates improved.
Spoiler Alert: Your Unlock Price CTA button has the widest fluctuations in conversion rates!
We are entering a new age of online measurement. Imagine what can happen when you have a trusted standard which eliminates vanity metrics and opaque conversion claims.
- No dealer group can gain group-wide insights from combining performance reports from different conversion and marketing vendors.
- Most dealer groups can’t rely on their own custom Data Studio reports because their conversion framework is full of holes.
- You might be surprised just how many dealer groups have given up on cleaning up GA4 yet it’s critical to optimize their Google Ads budgets.
Can you start to see what I see?
Changing Retail Mindsets
I want to be clear: the largest website, digital retailing, and chat companies can be very effective for dealers. However, without competition everyone grows complacent. Dealers should be looking at the lowest performing stores and have the boldness to try a different vendor in their tech stack.
When vendors have to compete, the dealer wins.
Ask yourself a simple question: If one of your website providers improved conversion rates by 25%, how quickly would you know?
In most industries, competition drives performance improvements. Yet many dealer groups intentionally remove competition from the very vendors responsible for generating leads, appointments, and sales.
A Real Example
One large dealer group which had diversity in its digital marketing agencies:
- Six agency partners
- Identical ASC measurement standards
- Access to the same datasets from the group’s CDP
- Same KPEYE reporting framework
Result:
One agency consistently produced paid social campaigns with conversion rates 300–700% higher than competing agencies.
The dealer group did not discover this because one agency volunteered the information. They discovered it because every campaign was measured using the same framework.
This example demonstrates why competition matters.
Unless you look at all the social media campaigns running at all stores, and use the same measuring stick, dealers would not see it clearly. You see, each vendor was using their own definitions for conversions.
This goes for website platforms as well. There are website companies which have very compelling “conversion stories” but if dealer group executives rely on OEM approvals for testing, they could be missing out on millions of dollars in sales. Dealers should be testing whenever they can to create a fair competition for their business.
OEM Restrictions May Be Limiting Dealer Innovation
I am well aware that some OEMs limit the number of website vendors or retail tool vendors which can be used in their dealer network. They have continued this practice for one reason:
Dealers have not produced compelling data which shows the OEM how much vendor choice restrictions are costing their dealer network.
OEM approval processes were created to reduce risk. However, dealer groups now have access to standardized performance data that can objectively evaluate vendor outcomes.
The question is whether dealer networks should continue limiting experimentation when performance differences can now be measured.
Historically, dealer groups have lacked the measurement frameworks needed to conduct controlled testing at scale. I believe KPEYE Inc. will be used in the future to show dealers and OEM leaders which tools are performing the best for their dealers.
I make this claim, not to be self-promotional, but because most dealer groups have no measurement standards in place. They don’t have the performance data to bring to an OEM dealer counsel meeting which shows reliable, unbiased measurement data from a controlled test. Oddly enough, most vendors don’t even measure the performance of their own software on different website platforms!
I’m Not Advocating a Vendor Free For All
The goal is not vendor chaos.
The goal is measurable accountability.
Dealer groups that standardize their measurement framework can finally create competitive environments where vendors must continuously earn business through performance. When performance becomes transparent, innovation accelerates, accountability increases, and dealer groups make better investment decisions.
Dealers should not misunderstand my suggestions. Technology like DMS and CRM platforms are often unified because of the sales processes and accounting requirments for the organization. Have one DMS and CRM platform can make good business sense.
However, changing websites is very easy. Forget the fact that someone in the marketing team has to learn a new CMS. If a new website has a Form Conversion Rate (FCR) of just 1% higher, then for over 50% of franchise dealers it would results in a 100% increase in conversions!
The increase in conversion rate is financially significant. It would generate more revenue and profits for dealers compared to whatever could be attribute to the extra time to learn a new CMS. That is the point of this article. When you measure accurately and fairly across all stores in a dealer group, performance opportunities JUMP OUT of the page.
With the correct reporting insights, dealer can explore why some stores are performing extremely well and why other stores are in the bottom of the list. You can’t do it without data standardization, which many dealer groups have yet to complete.
Get Started Today
Dealers who are ready to create a culture of real measurement to allow vendor bake-offs, start by subscribing to KPEYE today. You just indicate the number of websites in the group, and we will get the reports generated within 48 hrs, with some basic assistance.
You can learn more about KPEYE by watching this recording of our recent webinar: https://vimeo.com/1196192388?fl=ip&fe=ec
