Starting with a 1-page business plan in 1998, AutoTrader.com's president and CEO Chip Perry launched an on-line automotive marketplace
Now, as AutoTrader marks its 10th anniversary, it boasts about 15 million unique monthly visitors and lists almost 4 million new and used vehicles listed for sale.
Ten years ago, the Internet was still a new tool in the world of business and commerce. Many people thought all commerce would soon be on-line.
Perry saw things differently. And while many other Internet start-ups from the 1990s have been relegated the dust bin of history, AutoTrader.com has thrived.
“When I looked at the car-buying process — the test drive, the trade-in, the financing — I realized the process was too complicated and invested with too much emotion to be automated and put entirely online the way some of the early players in the online auto space were trying to do,” he says.
“The idea of buying something online and having it show up at your house is great for books, shoes, CDs and other low-investment products. But for a purchase that is as expensive, complex and emotional as the purchase of a car, the vast majority of people didn't then and still don't now want to make that purchase completely on-line.”
He took the age-old newspaper auto-classifieds model and injected the kind of search, sorting and dynamic content presentation capabilities that only the Internet offers.
Dealers and individuals had the opportunity to post detailed information about cars for sale, including multiple color photos. People searching for cars could search by make, model, year and a variety of other criteria, with AutoTrader.com acting as a marketplace for buyers and sellers to connect in the most powerful and dynamic way ever.
“Where the Internet excels in car-buying is as a marketing tool and information source where people with cars to sell can post detailed information about those cars and people looking for cars can search, see pictures and videos, compare prices and features and get information on dealer specials,” Perry says.
He adds: “But when they narrow their choice down to the three or four they may actually buy, everything we knew then and know now tells us that car buyers still want to go to see, touch and test drive the car as a final step in their search and purchase process.”