Pub. 4 2014 Issue 2

8 AUTOMOBILE DEALER NEWS ILLINOIS www.illinoisdealers.com T oday, though, there are trade-in tools such as AutoTrader. com’s Trade-InMarketplace that provide real-time market views and valuation processes to take the guesswork out of this process for the dealer. Trade-In Marketplace’s valua- tion, for example, creates an immediate cash offer for the consumer and provides a verifiable baseline price for the dealer- ship to negotiate with them. Perhaps even more importantly, the tool serves as a virtual used-car assistant that informs dealers how much they should be in the car for. Key benefits of trade-in tool: Reduces Wholesale-and Inventory- Related Risk Trade-in tools help mitigate inventory-related financial risk by providing the dealership with a standardized tool for evaluating not only the monetary trade-in value of the vehicle, but also its history (based on the consumer’s input), condition and desirabil- ity in the marketplace. Further, a trade-in tool augments a Used car manager’s effectiveness and helps avoid emotional manage- ment behaviors. Enhances the Customer Experience Research shows that consumers are actually very satisfied with many aspects of the car-shopping process, but they are most satisfied with shopping activities that largely take place online. Once consumers reach the offline stages of the car-buying process, satisfaction numbers start to decline significantly, and they are least satisfied with the trade-in portion of the car-buying process.1 In fact, consumers are more dissatisfied with the trade-in process than even traditionally disliked activities, such as filling out pa- perwork and applying for financing (see diagram). 1 Now that the Internet gives both consumers and dealers access to much of the same vehicle valuation information, strategy-setting for the trade-in process is more critical than ever. Historically, every time a dealer has taken in a trade there has been a delicate balance of determining how much to pay for that trade, while taking into account a consumer’s expectation of how much they should receive for it. How Trade-In Tools Improve Profits and CreatesHappy Customers BY HOWARD POLIRER , DIRECTOR, INDUSTRY EDUCATION, AUTOTRADER.COM