Pub. 4 2014 Issue 2

9 Integrating a trade-in tool can help improve this drop-off in customer satisfaction by serving as a bridge between the online and offline aspects of the car-shopping experience. Moreover, research shows that customers are particularly satisfied with their experience when a trade-in tool was involved because they perceived that it reduced the hassle of negotiating with the dealer, provided fast responses from multiple dealers and helped them understand the price the dealer would be willing to pay in the current marketplace for their specific vehicle on a trade. 2 Improves Overall Margins and Inventory Acquisition Used as an appraisal tool, dealers can provide the customer with a reality check on the true condition of their vehicle and what they would be willing to pay for that customer’s vehicle within the current marketplace. Dealerships can then use this offer to manage trade-in value expectations while creating opportunities for inventory acquisition at a price point that sufficiently accounts for the reconditioning and marketing/advertising needed to suc- cessfully retail the vehicle. In addition, dealers that integrate a trade-in tool into their service department operations create a cost-effective method of acquiring inventory. They can provide a comparison of trade-in value with repair costs that might incentivize a customer to trade in their car at a price point that also enables the dealer to repair and then successfully resell it. Facilitates Transactional Conversations Because trade-in tools take market data into account, dealers who integrate the trade into their in-store selling process stand an opportunity to engage with consumers in more meaningful, transaction-based conversations. For example, customers are more likely to redeem their Trade-In Marketplace offer in-deal- ership rather than securing offers before visiting the store.2 In fact, 35% of customers redeemed their trade-in offer at the dealer compared to 17% who redeemed offers generated via dealership websites. Critical to the success of the in-dealer redemption is for the salesperson to walk the customer through the appraisal pro- cess, which not only helps manage expectations and establishes rapport, but it can also lead to the added benefit of acquiring desirable inventory at a reasonable price point and/or closing a new car sale.  To learn more, visit www.weworkforyou.com/insights/view/white-paper- maximizing-the-trade-in-process. 1 Source: 2012 AutoTrader.com Dealership Experience Study (Morpace) 2 Source: 2012 AutoTrader.com Trade-In Marketplace Consumer Study (KS&R)