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Saturday, March 26, 2016

AVC: Riding for the Online Vehicle Auction

You could put me on the fastest thoroughbred in the world, but I guarantee you that I would still lose the race. It's not what I do. Despite the fact that the horse is capable of excellence, he still requires a skilled operator. Now let's name the horse 'Technology', and envision your auction as the jockey. Are you jumping obstacles, or are you still trying to figure out how to open the gate? If you are the latter, then you are not alone.
There is no doubt that the application of technology can sometimes seem to create more problems than it resolves, especially if the auction does not have someone who is adept in troubleshooting or maneuvering around the technology at the first detection of a bug. Essentially, when an auction signs on for live, Internet broadcasting, they pronounce to the world that they are a technology business. The question is... how well has the auction established their credibility in this capacity? For example, when dealers call because they are experiencing issues attempting to get online and bid, does the auction have a reliable customer support system in place? How dependent is the auction on their technology provider? Do they have to call the support line for even the most minor administrative tasks? A huge problem for the technology providers is that they are inundated with calls that are geared less towards 'tech support', and more towards supplementing the auction's deficiency in qualified staff. Unfortunately, the snowball effect is that the technology providers receive a higher volume of support calls than necessary, and even the most legitimate requests end up buried in the never-ending sea of feature requests and minor bug fixes.
Then there is the issue with 'too much technology'.  Technology companies sell technology. They are not going to tell the auction, "If you have that, then you don't need this." In the event that something goes wrong, the auction has to guess which company to call, and is almost always referred to the other company. "It's not us, it's them!" This is extremely frustrating, especially on sale day. The bottom line is that auctions have a grave need for technology intervention both prior to purchase, and throughout the relationship with the vendor.
Still, technology is only one aspect of the equation for online success. Let's forget the horse for a minute, and talk about the elephant in the room. Let's name the elephant 'Online Marketing'. There are some auctions with a great technology infrastructure, but lack the ability to strategically market their business online. Unfortunately, not many marketing companies specialize in the online vehicle auction realm since, prior to technology, auctions typically restricted their efforts to on-site promotions. Therefore, hiring a marketing company would be costly, and require a lot of effort in the way of trial and error to determine the most effective campaigns. All the while, online attendance remains low, and the cost of having an online business has now skyrocketed. To the majority of auctions, the marketing plan is comprised of a single sentence... "Send out an email blast!"
Of course, there are the exceptions to the rule. There are auctions who have raised the bar when it comes to marketing. In addition to email blasts, they have turned to social media in an attempt to captivate their online demographic. However, even with some of the most engaging posts, and well-designed collateral, the marketing effort may still fall short of the new customer acquisition effort. Here are some ways that even the most visually impressive campaigns may not go the distance:
  • No analytics: The marketing effort is in place, but never evaluated or improved.
  • Ineffective promotions. If you are giving away a grill, you are probably not marketing to the online customer.
  • Poor execution: The marketing brought in new customers, but they did not have a great experience.
  • Lack of follow-up: The auction never calls customers who have dropped off to ask about their experience in an effort to determine why they left.
So whose job is it to manage the online initiative? This is still a mystery at many auctions. In addition to the 'who', there is still the question of "what do they do?". Are they in charge of making sure events are created, and the inventory makes it to the internet? Do they interact with clerks, and auctioneers? What expectations do they relay to the online staff? Do they define the online marketing strategy? Do they set performance goals, and track milestones? Do they follow up with online customers? Do they monitor the sale? Are they effective Online Managers? or... are they actually a sales or IT person who has been appointed the title of 'Online Manager', and are expected to fill this role in addition to their pre-existing responsibilities?
The fact of the matter is that the creation of online technology left the Independent Auto Auction community with a lot of gaps to fill. There is now a surplus of technology, and a deficiency in training and resources. Many of the auctions were sold on the idea that the technology would do all of the work, and grow their business. Ultimately, they've come to realize that they can have the best horse in the race, but... they still need a jockey. Allow me to introduce... 'Vcommerce'.