Category Archives: Service

An Example of Easy E-commerce (the way it has to be)


carsales.com launched tyresales.com.au a few years back as a complimentary market for our consumers and dealers to benefit from.

It differs from our core businesses as it is pure e-commerce as opposed to the marketplaces we run that introduce buyers and sellers. We have learnt that e-commerce is somewhat different to an online marketplace but there is one thing that is the same – they both have to be easy.

carsales.com.au is easy because of its superior search technology, easy design, quality data, the largest, cleanest inventory in the market and most of all because “it works”. We are striving to make Tyresales.com.au “just work” too and here’s an example of it working.
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Last month I had my car booked for a service at Ritter Land Rover on a Friday. From my previous service I knew that I was most likely going to need new tyres so I had a choice – get on the front foot to order them myself ensuring I get a good deal or I could just wait until Ritter called me to say I need new tyres which they would source, taking away my control and most likely costing me more.

So I decided to use Tyresales.com.au to find my tyres, buy them and have them delivered to Ritter in time for my service. This is an absolute plus in buying tyres on Tyresales for consumers and dealers.

One of the benefits of being a carsales dealer is that they have the opportunity of accepting tyre fittings from Tyresales which then provides the opportunity to up sell know a service. For a consumer, combining a service with tyre replacement just makes sense.

The process of finding the tyres I need was dead set easy, even for someone as car illiterate as I am. Not only did I find tyres easy, I found quality tyres that were 22% off retail price which for 4 tyres added up to a $600 saving. The real beauty of it though is that before I paid for the tyres online, I had the option of selecting the dealership I wanted the tyres delivered to.
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So in virtually 1 swoop I found the tyres I wanted, paid for them (with real savings) and had them ordered for delivery to Ritter in time for my service on the Friday.

Come Friday I took my car to Ritter for a service and when I picked it up, 4 new tyres were making their mark on my Land Rover.

The process couldn’t have been easier or more convenient, exactly the way e-commerce should be (and thank you Ritter for the same in service!).


2 Critical Factors in an Ecommerce Site


carsales.com has made its mark with online marketplaces. How hard can it be to take that into ecommerce?

Like anything, it’s not hard when you know what you don’t know. Simple right? Let’s look at it.

carsales.com.au is an online marketplace connecting buyers and sellers of cars. Tyresales.com.au is an ecommerce site where buyers purchase tyres through the online store and have them delivered to a Tyresales accredited dealer for fitting.
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Put simply, an online marketplace connect buyers and sellers but doesn’t play a part of the actual transaction whereas an ecommerce site is all about facilitating the transaction and providing the goods purchased online.

We have found from a website perspective that changing wording, colors and layout on both sites can move the needle as far as generating leads or sales, vital metrics. Above all, they both have to be easy to find what you want and easy to action.

There are however, two factors in an ecommerce site that are material to success:

Price
Price on an ecommerce site is absolutely vital. Online buyers will shop around to find the best deal so it is ultra competitive. Remember, the price is the price on an ecommerce site, there is no haggling as you are paying without talking to anyone whereas the price on an online marketplace is generally “negotiable”; the marketplace connects buyers and sellers to then make the deal.

A competitive price on carsales.com.au is important to attract buyers but it is not the be all and end all. On Tyresales if the price isn’t the most competitive we will lose the sale to one of the many competitors out there.
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Supply
Once a buyer has purchased something through an ecommerce site, it is imperative that the goods are supplied in the timeframe given. Not doing so ruins all goodwill which effects word of mouth recommendations, could create negative online reviews and most definitely cancels out a repeat purchase.

We have found on Tyresales that these two factors are critical in creating a trusted site that is top of mind when drivers need new tyres.

These are only two differences between the online marketplace and an ecommerce site (there are plenty more) and wow, they take some experience to get it right.


The Outsourcing Dilemma


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When should an online publisher use a third party service? It’s a question that comes up a lot in our space. I’ve been on both sides of the fence so I’ll have a go.

When I co-started a web services company the business model was relatively simple – partner with large online media players and their sales force sells your service for a recurring monthly fee. As they grow, you grow with them, achieving economies of scale along the way and carving out a nice business.

“There was one notable exception from that list – carsales. We just couldn’t get business with carsales…”


Before too long, my company supplied web based services to the majority of the big players in the Australian market in all forms of classifieds – Pacific Access/Sensis (Cars), News Digital Media (Carsguide, Careerone, Homesite, Gofish), Ninemsn/Trader (Carpoint), Fairfax (Mycareer), Seek, REA – all of which gave access to thousands of SME’s.

There was one notable exception from that list – carsales. DMi just couldn’t get business with carsales in the 10 years I was there as carsales has always been different to all other publishers in the use of third party providers in that they didn’t use them; they have always had the technology (or built it) in-house be it to aggregate inventory, manage inventory, manage leads, inventory search engines, web sites, etc, all the usual third party offerings used by their competitors.
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Pros and Cons
Before I share a Case Study where carsales made the decision to outsource to a third party service provider, I want to share my Pros and Cons.

The Pros for outsourcing to a third party service provider:

  1. These services are usually not a publishers core business so it makes sense to have your people concentrating on getting your core as best it can be.
  2. Time to market should be quicker

The Cons against outsourcing to a third party service provider:

  1. Recurring cost that increases as your services increase.
  2. Not being in control of the whole ecosystem around your core service.

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Case Study
A few years ago a new feature to accompany listing vehicle inventory online took off in the US and made it’s way into Australia. carsales‘ competitors were starting to use this new feature so there was an opportunity for carsales to also add the feature to the website as well as provide it to dealers for their own websites. The question was to build or license a third party service.

“carsales sought to lock in a monthly fee for the service”


carsales had always been one to build but had reached a stage where there was so much happening in technology that it made sense to license a third party service to leave the tech teams to do more important developments and to get time to market efficiencies (the two Pros).

In order to offset the first argument against using third party service providers, carsales sought to lock in a monthly fee for the service to use it across the business. The downside to this is that if carsales fail to sell the service to its dealers, carsales loses as it still has to pay the monthly fee. The upside is that the more dealers carsales adds to the service, the cost of the third party service doesn’t just keep rising, it is capped. The challenge was to find a flat fee that suits carsales and the third party provider.
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Once a third party service provider was found and terms were agreed to, carsales very quickly was able to start selling the new service, giving the website a new feature and forming a new revenue line. Using a third party service provider had worked.

“In the end this has ended up being a positive move for carsales”


The service was working well until the third party service provider informed carsales that the terms of the agreement would change after the initial term. This wasn’t acceptable to carsales so it did what it had to; put together a tech team to build the technology to seamlessly replace the third party service when the term was up.

In the end this has ended up being a positive move for carsales. The service and its features remained pretty much the same yet the cost of supplying the service was reduced by over 50% (which includes amortising the development effort over a number of years) and hence, the two Cons were adequately covered off.

My View
I think there is a time when it makes sense to outsource to a third party service provider and a time when not to. The two Pros stand up; as do the Cons. It all comes down to a business decision at the time that fits the business in the best way.

The most important thing though is to not be afraid of changing that decision. It’s ok to change your mind to get the right outcome.


Do You Know Your Online Reputation?


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carsales‘ core business model is around connecting sellers and buyers; we do an excellent job of doing this.

Once we have connected the seller and buyer, we provide tools and education around the best practices to make a sale. Here is an example of where post connecting the seller and buyer, somethings are out of our control.

We had a dealer who was questioning the quality of leads sent to him and subsequently what they were paying.

It’s always an interesting conversation because it’s not like leads are vetted for quality and the “good ones” sent to certain dealers yet we have dealers who sell a car from every 4 leads and dealers who sell a car every 9-10 leads. This dealer was in the latter bucket.
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I decided to look a little further into the dealership to connect a few dots. Before I looked into the way they handle the leads (response time, etc) and I didn’t know if he had his own website so the first thing I did was a Google search.

On page 1 of the Google results was something that went someway to explaining things for me. The result description high up in the Google result list showed 1 star out of 5 from 12 from a user review site. Hmmm.

I clicked on the link to read the user reviews; they weren’t good reading (or maybe they were, depending on your need).
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So picture this:

  1. You are a car buyer on carsales, you select a car you are interested in and submit an enquiry.
  2. An email is immediately sent to you with the dealer name and details.
  3. You go to Google to find the dealer website.
  4. Put in your face is a user review ranking of 1 star (out of 5) and a click away is 11 extremely negative reviews.

When the dealer contacts you about your enquiry what do you do?
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It doesn’t matter how many leads carsales sends to this dealer or how little or much is charged; the dealer is going to struggle to convert some of the leads based on their online reputation.

In today’s connected world negative reviews are a click away so it is vital for businesses to first know what their online reputation looks like and then ensure they do something about it.

As I said, it’s always an interesting conversation.


5 Service Differences Between Sao Paulo And Melbourne


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carsales.com‘s investment in Webmotors invariably means business visits to São Paulo. From a business perspective São Paulo is not cheap but vital to Brazil as the business hub.

One the first things we had to do with Webmotors was give the company its own identity outside of Banco Santander which included having its own office space. Location is always important in a big city to ensure you can attract the best talent and this was a big factor in being based in Vila Olimpia. What struck me about looking around Sao Paulo at suitable office space is the extra services that ultimately drive up the cost of setting up (and visiting) for business.

Here’s 5 examples that are a little different to what we’re used to in Australia:

1. Office Buildings – All office buildings I have visited have an electronic swipe system with security guards manning the entry/exit points. For visitors, you must present photo id (and in some cases a photo taken) before a temporary swipe card is issued for your visit so every building has staff ready to process you. The other noticeable difference is the presence of cleaners, etc throughout the day. These costs add up.

2. Hotels – There just seems to be people everywhere no matter what time it is. Security at the front door then more as you come in and that is before you even get to the reception area.

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Shell Service Station, Brazil

3. Service Stations – the good old days of the service station attendant is alive and well in Sao Paulo so you don’t have to leave your car to get your tank filled if you don’t want.

4. Valet Parking – Parking is tough in São Paulo so at most restaurants, bar precincts, shopping centers and hotels the best (or only) alternative is valet parking which just keeps adding to the expense.

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Shopping Vila Olimpia, São Paulo

5. Shopping Centres – Armed guards at the front doors and people directing traffic at the entrance just to name two.

These extra services are a result of the extra security measures required and the need to provide some form of employment to the broad class of people. They need to be employed. The result is that no matter what the cost is, all of these extra services add up and someone has to pay for them. I guess it’s the end user which makes Sao Paulo not the cheapest place to do business or live.