Thursday, April 7, 2011
In 2009 I was in the market of buying a car. My budget was fixed and painfully calculated by certain economical factors, so I needed to make sure not to exceed the budget. I was well aware of the long and adventures journey to get a car. A used one in my case. My decision to buy a car was not so much driven by a particular brand or model or color, more by my budget. Of course I had a short list of cars in my mind, but was more open minded. Now I started my journey with the usual suspects and went online to various web sites to get an idea of car values, reviews, opinions, "true" values, model years and many more. End of the day I wasn't a bit closer to narrow down my choice, due to the flood of information and sometimes various aspects. Now what ... I did what I should have avoided and what my subconscious told me not to do. I went to the local dealers to get to look at their inventory and to test drive a couple of the cars I had in mind. You can guess how affective and informative these visits were ... almost null. In addition when talking about prices I had to play the game of offer/answer/ask the boss/offer. I told the sales guy my exact budget, but of course he wanted to squeeze as much as possible out of me, but what made me really mad and frustrated is the fees, and extra costs added to the price, what pushed the car price over my budget limit. Great. A couple of hours wasted. I think I am not alone when I say that you feel like begging a car dealer or car owner to spend your hard earned money to get their car.
After I went home I asked myself why isn't there a way of telling everybody exactly what I want and how much I am able to spend? I wanted a web site where I can define the car, or in my case multiple car choices, include budget information, check all features and options and finally tell the car sellers in the world how I intend to pay (cash, leasing, financing ...). Then the car sellers, dealers, car manufacturers should be able to look at what I want, should compare it to their own inventory, see how well it matches my desired car and then tell me for how much they would sell it to me.
I realized that this business model doesn't exist today. All auctioning and car web sites focus on the seller, not the buyer. I have the money that everybody is actually after, so why isn't there a web site that is more buyer focused?
That's exactly why I started nyoobid. A new way of buying and selling cars. Instead of wasting hours of research, review, useless car dealer visits, I created a web site that is buyer focused. Car buyer can start an auction and define exactly what they are looking for. They can be as specific or vague as they want. They can select a single or multiple brands, can leave the exterior color unspecified if it is not so important, choose and check all features and options that are important or necessary and finally tell everybody what the maximum budget is and how you intend to pay. Easy in three steps that take less than 3 minutes.
Now I also looked at the seller side and realized that this concept is actually not just more efficient and easier for the buyer, but also for the seller. Instead of spending money ineffectively on posting an ad on a web site and hope to get attention from potential buyer they can use a sophisticated search algorithm to see what car buyer actually matches their inventory. The chance of selling a car when the match is 80-90% of what the buyer is actually looking for is logical.
And even the dealer would save tremendous costs, increase their revenue, shorten the sales cycle and could make the entire selling process more efficiently by using this new concept. Tools that automates the online inventory management and the automated inventory check against all buyer auctions and the ability to automatically bid at auctions that have a certain matching index (probably greater than 80%) should be included to make sure that there is value in using this concept.
Ok, that was my experience and a good thought, but what is actually the trend. I did a lot of research and talked to many experts and it was interesting to see that according to a study by GapGemini in November 2008, more than 44% of consumers said they were likely to purchase a car entirely over the Internet if that capability were available. In addition the study further exposed that 22% of cars bought in 2008 were found online and now more than 80% of car buyer and seller are using the Internet. Then another for me shocking fact was according to nada.org (May 2008) car dealers spend $7.86bln ($350 cost for ad per car) on advertisement without an idea of the return on investment and how effective these ads are. Looking at another statistic from nada.org I wanted to make sure that the solution provided should handle and solve most or all of the pain points of car buyers and sellers (see statistic).
After considerations, lots of research, talking to many many experts and actually have one of the experts being my trusted adviser and part of the team I created this now patent pending web site where buyer can start an auction and seller can bid to get the deal done.
In my believe this concept has many advantages for all participating parties. From cost, time and resource savings, to increased revenue, to shorter sales cycles to a way more efficient way of buying and selling cars. And in the end, everybody is happy. The buyer, because they got their dream car withing the budget boundaries and the seller that can focus on auctions that have a high matching index and therefore a higher probability of selling.
nyooBid went live mid of 2010 and the rapid grow in registered car buyer and seller confirms the trend of getting away from the classical, longer lasting way of buying and selling cars.