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GM turns to KBB website for targeted incentives

General Motors is using Kelley Blue Book’s website to offer targeted incentives to consumers, the latest sign that carmakers are keen to integrate their marketing efforts with third-party lead providers.

Meanwhile, Cox Automotive, which owns KBB as well as Autotrader, has a second automaker lined up offer incentives to consumers but declined to reveal the company. Incentives for the second customer hadn’t started as of last week.

After a yearlong pilot, began running the incentives for GM in September. Earlier tests were nonpaid, but GM began paying for the service in September, said officials for Cox Automotive Media Group, which owns Kelley and Autotrader.

Cox intends to use the consumer data it gathers and distribute special offers that will drive showroom traffic more efficiently for automakers.
“What we want to do is provide them with information and enable their capabilities and strategies within our sites,” said Jared Rowe, president of Cox Automotive Media Group. “We’ve got eyeballs; we’ve got consumers. We can help them influence consumers to the benefit of the consumer and the benefit of the advertiser.”

Rowe intends to extend the product across the entire Cox Automotive Media Group, including Autotrader. Kelley has 20 million unique visitors a month, while Autotrader has 18 million to its website. Sixty-four percent of KBB’s visitors are open to buying a new vehicle, the company’s data show.

Other third-party shopping sites have done targeted incentives, but Rowe said Cox can distribute them on a very large scale and target them precisely.

Incentives are not limited to consumers shopping at dealerships with Kelley or Autotrader listings.

“It doesn’t funnel customers to a specific dealer that does business with us,” Rowe said. “It delivers an incentive that the OEM then decides who can redeem. That’s a key point of differentiation.”

The ability to target incentives should help automakers solve specific problems, said Steve Lind, executive vice president of operations for Cox Automotive Media Group, such as reducing a glut of pickups in a particular region.

Offers can range from a $50 gift card for taking a test drive to an extra $2,000 off the purchase of a new vehicle. In some cases, Cox has found that a more modest offer, such as a test drive gift card, can be more effective than a larger cash incentive.

Many visitors to the Kelley website are trying to find out how much their used car is worth. By knowing what car a shopper already owns, an automaker could create an incentive designed to either conquest or retain the customer.

“Consumers come to Kelley to find pricing information; consumers come to Autotrader to compare vehicles,” Rowe said. “That’s where this thing, we believe, is intensely valuable.”

Rowe described the “Holy Grail” for marketers as knowing, for instance, that a customer has purchased 15 Ford F-150 pickups in a row. “Whether he gets another $1,000 or not, he’s buying another F-150,” he said. “Let’s not overpay for that consumer.” Such intelligence could be offered down the road.

So far, GM is using a range of approaches and running multiple types of incentives, Rowe said. But a GM spokeswoman declined to confirm that GM is participating in the targeted incentive program.

“For competitive reasons, we don’t release details about incentive programs like that,” she said.

Over the past year, Cox has been refining its abilities to target customers and figuring out which incentive campaigns it should run on its sites.

“Will you get the same effect with a Starbucks gift card that you get with $500? Because when you can find that, that’s magic,” Rowe said. “But that takes a lot of work, and that’s why we’ve been at it, the way we’ve been at it, quietly for so long.”