The Mystical VDP

For more than a decade, the vehicle detail page (VDP) has been the preferred metric for automotive marketplace vendors to justify the effectiveness of their advertising to dealerships.  When a dealership general manager or sales manager questions the performance their campaign, the standard vendor reply is to highlight the quantity of VDPs the dealership is receiving. 

But, are all VDPs of equal value?  Do higher VDPs translate to more leads and sales?

To answer these questions, let’s take a moment to suspend our believe in the magical power of VDPs, and analyze VDPs using practical factors that impact dealership sales beyond advertising.  In this analysis we will look at two real life factors that dictate VDP value: distance from the dealership and a vehicle’s popularity, scarcity, and attainability.

Is a VDP indicative of an engaged or high-quality shopper? 

It depends.  Like most metrics, the average value of a VDP is different from a VDP’s effective value.  In other words, some VDPs should get full credit as a measure of engaged shoppers, some partial credit, and some no credit. First, let’s separately analyze new vs used VDPs based on geography. 

VDP Quality Factor - Distance from Dealership

Most dealerships sell the majority of their new vehicles within their primary market area as defined by the OEM.  In urban markets this is typically a 10 mile radius or less.  In suburban and rural areas this can be a 20 or more mile radius.  Outside of this area, the opportunities for sales are limited, and if a dealer has success outside of their market is typically through heavy discounting that gives the shopper enough of an incentive to compensate for their travel time and inconvenience.  So when evaluating the value of a new VDP, it makes sense to count “in-market” VDPs and discount the value of VDPs outside of the market areas.  It also makes sense to totally disregard VDPs that are far outside of your market, areas where you sell few if any vehicles per year.

Shoppers are willing to travel further for the right used car, especially if it’s a high-demand model, color or trim level.  This can be 50 miles or more depending on the market.  Similar to new cars, used VDPs outside of this effective sales zone should be discounted. 

Recommendation – Ask your automotive marketplace representative to provide a breakdown of new and used VDPs by distance from the dealership.  Analyze your new and used sales over the past 12 months by distance from the dealership to determine your “Primary Sales Area”.  Then eliminate VDPs from outside this zone to determine your “effective VDP count”.

VDP Quality Factor – Popularity and Scarcity of the vehicle

Unique, popular, or scarce vehicles can be exceptions to the Primary Sales Area rules.  First, we should separate popular cars that are exotic or ultra-high performance vehicles as the value of these VDPs are limited by the “dreamer” to qualified shopper ratio.  “Dreamers” are fans of a particular vehicle that are shopping for entertainment value. They are not qualified shoppers looking to buy. If a fan club exists for a particular make and model, it’s not uncommon for the dreamer/shopper ratio to be 10 to 1 or higher.  These VDPs should be discounted when determining “effective VDP count”.

Unique and scarce vehicles that are also attainable in terms of cost are an exception to the Primary Shopping Area.  This can be quantified by a vehicle’s scarcity index (an AutoTrader calculation for comparing the scarcity of a particular vehicle in a particular market). Vehicles that are scarce, popular, and attainable have an extended primary sales area that’s related to their degree of scarcity. Examples of these vehicles include models with strong brand appeal like pre-owned Porsche 911s or Jeep Wranglers, SUVs and trucks with longer than average ownership terms and high purchase to lease transactions like Toyota 4-Runners and Toyota Tacomas, or cars that are valuable due to macroeconomic forces, like a Prius during a period of high gas prices. Unique and scarce vehicles will naturally generate more VDPs than more common vehicles. When looking at the overall value of VDPs produced for a dealership in a given month, the unique and scarce VDPs should be discounted. If a few of these vehicles produce enough VDPs to skew the overall reporting then they should be treated as outliers, and a second version of reports should be generated excluding these cars.

Another argument that can be made to diminish the VDP value for cars that are both popular and scarce cars is that to some degree they sell themselves and don’t need promotion on a 3rd party website.  Dealership website traffic maybe sufficient to sell the car in quick enough on its own, thus further diminishing the value of these VDPs. 

Cars that have an abundant supply like high volume lease return vehicles are the ones that truly need promotion and VDPs.  In Southern California or other markets with high luxury sales, a BMW 3 Series or a Mercedes-Benz E-Class are good examples of this category.  With significant competition from other sellers holding nearly identical vehicles, VDP views are at a premium and should be considered at a higher value.

Recommendation – If possible, structure your 3rd party website package to match your inventory.  If you have a high percentage of low scarcity and low-medium popularity vehicles, you’ll need a package with “featured” placements that give your vehicles an advantage over your competition and generate VDPs in spite of crowded vehicle search results pages.  If you have a high percentage of popular, scarce and attainable vehicles, you shouldn’t need the added boost of featured placements.  If the 3rd party website’s search algorithm delivers results based on relevance, VDPs should come easily.  For very popular vehicles, a dealership website is likely sufficient to sell the car.