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Autobytel.Com Case Study

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In 1999 Autobytel. com was leader in the online car referral business amongst a very competitive market. The online car referral concept was based on giving the consumer a way to shop for automobiles online that didn’t involve going to a dealership and dealing with high pressured sales. When time came to buy the automobile they had selected, the service provider would send the purchasers information to a qualified dealership in their area to process the sale with little to no haggling involved due to the level of information the purchaser had at their disposal.

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The way these online referral companies were able to make money off this process was to sign up qualified dealers around the country and charge them a fee to send motivated buyers their way, and to offer a large compliment of services that aided the purchase of the vehicle to the automobile purchaser. Though Autobytel. com was experiencing record growth in the online car referral industry it still was not able to create positive earning off the services they were providing.

Like many Internet companies this was a problem that plagued their companies due to the large over for the revenue they received and they new if they were to remain a viable company something needed to be changed. In order for Autobytel. com to turn their current offering into positive earnings, there are many thing that need to be looked at create more added value proposition to both of their customers, the automobile buyer and seller. For the automobile buyer, besides getting a great deal on an automobile what separate Autobytel. om from the other online referral companies are the additional services they provide in the buying process. And the key selling feature of Autobytel. com to the dealership is that of exclusive rights to a territory. Though both of these propositions add value to the customers, neither has been truly leveraged to produce the greatest revenue possible.

So by focusing on what each customer group is really looking for in the online automobile referral experience and being able to relay these value added features through focused marketing should allow for steady progress in the fight to create positive earnings. Autobytel. om had many services that complimented the online referral business that they tried to use to differentiate them from the rest of the market in order to add value for the automobile buyer. Financing options, insurance quotes and even loyalty programs have already been put into place, but from the buyers perspective there hasn’t been really any value added benefit since many of the other online line referral companies have similar offerings. To be successful they need to develop a program either with guaranteed pricing or with some other value added feature that would allow for more seamless quoting from the dealer.

Right now they still get contacted from the dealership in order to complete the sales cycle and get the final sale price, if this step could be eliminated and truly made into an online sale would be something perceived as value add proposal. The main problem with a program such as this is that the dealerships involved would then have even less control of the sale and it would be cutting into already tight margins that they are always working hard to increase, but this would free up dedicated sales people to these online referrals to more hands on selling even though the rate of return is lower.

This kind of imitative would be perceived as a benefit to both customer groups One of Autobytel. com’s key deliverable to the dealerships they were selling this service to was that of the exclusive rights to referrals for the vehicles they represent for the territories for which are located. This value to the dealership needs to be leveraged and higher rates need to be established for these kinds of exclusive agreements.

Currently the dealerships have contracts established with multiple online referral service providers, but none offer this level of sales control of the territories in which they service. If they were to add more dealerships to these territories would result in overall better pricing to the automobile buyers, the dealer does not see any value in that, but it’s not being leveraged enough. By increasing the rates for these agreements or offering larger territories at an extra price to the dealerships would let them know that through Autobytel. om they have higher level of competitive advantage which should allow them to grow sales and be able to decrease the number of online referral services that they currently participate in. But as a concern for the automobile buyer they would then have less control over where their referral goes since a dealer may purchase the rights to an area that may not be as convenient to their location. If Autobytel. com’s earnings are to increase to a positive level, one of the things they need to develop a more intoned positioning statement and better focus of their marketing initiatives.

Currently Autobytel. com has very strong brand recognition and they are known as the leader in online referrals but these positioning statements haven’t been truly leveraged to produce a higher level of earnings. One thing that they could do leverage these already strong points within their brand is create a separately focus branding strategies for both of their base customers where this would actually help them convert more online referrals to the dealerships and a higher level of perceived customer satisfaction to the automobile buyer.

Their first attempt at higher brand awareness was through the Super Bowl ad in 1997 which was very successful, and reached a new customer base that had not already been tapped by the Autobytel. com offering and they did see increases in online referrals. By leveraging a higher level of marketing to the different groups of more motivated buyers they would reach a larger market, one such initiative could be to sponsor a car in NASCAR. This would be perceived as value to the dealerships because very high-level visibility with a very large customer base and through NASCAR the brand of Autobytel. om would be seen by millions of people that would for the most part not be put into a position to received brand awareness by normal advertising channels. The only drawback to this rout of advertising is that if they sponsored a car, their would be a brand associated with that vehicle and some dealers may not be able to support a business partner that had affiliations with other brands of vehicles, so the best logical proposal would be to sponsor a race or the league in sport in general.

With these initiatives in place Autobytel. om should be able to better leverage themselves as the end all solution to the online referral business for both the buyers and dealers and it will begin to produce earnings that are trending toward the positive side. But this initial push will actually produce a higher level of overall cost due to the greater advertising dollars and the loss of some dealerships through more focused selling, but as the referrals increase and they able to capitalize on high revenue from the dealers, the Autobytel. om brand begin to become even stronger. So with these strategies in place there is no doubt that Autobytel. com can begin create positive earnings and begin to be know as the true leader in the online referral business as the mass of the buyers and dealers of automobile would have no doubt which referral service they should us when sourcing or selling an automobile online.

Cite this Autobytel.Com Case Study

Autobytel.Com Case Study. (2016, Oct 15). Retrieved from https://graduateway.com/autobytel-com-case-study/

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