Online cars site Edmunds.com is making a subtle but important strategic change. Until now, it's been a place where consumers did research on what make and model car was right for them. Now, it's becoming a place where consumers can learn about specific cars they can buy.
It's a step in the direction of the ultimate goal of getting as much of the car-buying process online as possible.
Until now, consumers visiting Edmunds.com were asked to select criteria for cars they were looking to buy. They entered the make and model, new or used. Alternately, they could start with the kind of vehicle they were looking to buy -- SUV, sedan, truck, minivan, and so on -- and then look for options.
But starting this month, Edmunds will prominently display specific vehicles available for sale right away.
The new website is currently being tested to 30 percent of Edmunds.com site visitors. Edmunds plans to announce it Thursday, and make it live for everyone Oct. 15.
"We're in the business of trying to make car-buying easier. In the past, we helped people decide what kind of car they wanted but were hands-free on the car-buying process itself," Seth Berkowitz, president and COO of Edmunds.com, said in an interview. "Instead of people doing research on theoretical cars, we're giving them information around actual cars. It's a shift in the navigational scheme on how we organize the product."
As an earlier step in this direction, Edmunds rolled out the Price Promise program. Through Edmunds, dealers provide a price commitment in exchange for customer contact information.
"Dealers make promises and then honor them. We're trying to foster trust between consumers and dealers," Berkowitz said. "This is a place where there is a lot of mistrust, and it doesn't need to be that way."
Edmunds is looking to become a trusted brand in car shopping. "The vision that we have is that ultimately people belong to us the way Amazon users belong to Amazon Prime," Berkowitz said.
There's a difference between Amazon and a car-buying site, of course. People use Amazon several times a week, but they only buy a car every couple of years. Berkowitz acknowledged the analogy is imprecise. "But people will have that sense of affiliation that when it does come time to buy a car, there's an easier way to do it," he said.
In another step toward making it easier for consumers to get cars, Edmunds is testing a Lease Promise program, which it plans to roll out in January or February. In that program, the site will offer pre-negotiated leases.
"The larger vision is, can we get to the point where much of the shopping process can be brought online?" Berkowitz said. Consumers would be able to negotiate leases, prices, financing terms, and trade-ins online.
The car sale itself will need to be done on-site, through the dealer, due to franchise laws. But the process can be simplified. "When you actually get there, a vast majority of the process has already been done online through a partnership with Edmunds and the dealership," Berkowitz said.
Edmunds.com was founded in 1966. It discontinued print products and went online-only in 2005. It's a midmarket company with about 500 employees.
The company gets its revenue from dealer partners who pay to list and advertise vehicles on Edmunds.com.
And that raises a potential problem with Edmunds' strategic goals: Edmunds is strengthening its own ties with consumers, and handling more and more of the car-buying transaction. Dealers may fear disintermediation. Edmunds, rather than the dealers, might own the relationship with the customers. In that case, dealers may balk at doing business with Edmunds, which would drive consumers away as well.
I asked Edmunds about that, and Berkowitz responded, "We don't intend disintermediation. We are taking careful steps with all of our product roll-outs to ensure they serve car shoppers and dealers as intended, collecting feedback and making adjustments as needed."
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— Mitch Wagner , Editor in Chief, Internet Evolution