In 1998, a group of newspaper groups – from the Los Angeles Times to the Chicago Tribune – got together to create an online automotive classified advertising site, calling it Cars.com.
It was a bold initiative 24 years ago, especially for print publications. The original site was a relatively austere listing of vehicles for sale, not unlike classified ads. But it was ahead of its time as a digital third-party lead provider for dealer clients.
Today, Cars.com is a multifaceted automotive marketplace that provides consumers and dealers with various services. The company’s strategy under CEO Alex Vetter is to increase revenues through increased offerings.
Evidence of that are two recent acquisitions: Accu-Trade, which helps dealers acquire inventory from assorted sources, and CreditIQ, which provides online auto financing.
In a group interview with Wards, Vetter, Accu-Trade’s Jeff Zamora and CreditIQ founder Bill Liatsis discuss what the acquisitions mean to them.
“Cars.com offers amazing and powerful exposure,” says Zamora, Accu-Trade’s chief technology officer who now plays a leadership role at Cars.com.
Liatsis says CreditIQ served about 100 dealership clients pre-acquisition. “We expect that to go to 1,000 with Cars.com.”
Vetter (pictured, below left) characterizes the latest acquisitions as fitting into a strategy. Essentially, it’s a case of the whole becoming greater than the sum of the parts.
“We’ve always been a company that prides itself on innovation,” he says. “We were the first (in the third-party lead-aggregator sector) to go mobile when a lot of people didn’t even know what that was. We were the first to include dealer reviews (enhanced by the acquisition of DealerRater in 2016). We were the first with an app.”
Acquiring Accu-Trade gives Cars.com the ability to provide dealer clients with vehicle acquisition, including buying vehicles from private parties.
That will “empower millions of consumers to confidently and securely sell their vehicles online to the best buyer,” says Vetter. About half of Cars.com visitors are looking to trade in or outright sell a vehicle. With Accu-Trade, Cars.com visitors can sell vehicles to dealers.
Accu-Trade revenue is based on appraisal and data-product subscription fees to dealers.
“We are excited to enter into the rapidly growing multibillion-dollar digital vehicle-acquisition and remarketing category with Accu-Trade’s best-in-class valuation and appraisal technology,” Vetter says.
He speaks of “further acceleration of our platform strategy” and “end-to-end transaction capabilities for buyers and sellers” as well as long-term growth for Cars.com.
Zamora notes the Accu-Trade acquisition is “perfectly timed regarding the current inventory dearth” of new and used vehicles because of supply-chain problems.
CreditIQ’s platform focuses on allowing consumers to digitally obtain car loans through dealers. “We work with banks to bring indirect lending online,” says Liatsis. “We answer the biggest question: ‘What’s my payment?’”
Digital auto retailing gained traction during the height of the COVID pandemic when dealership sales departments in some states were temporarily closed by government mandate.
Although the virus has abated, digital auto retailing hasn’t. “COVID accelerated digital,” Vetter says. “Today, auto consumers expect more online.”
Steve Finlay is a retired Wards senior editor. He can be reached at [email protected].
