FordDirect.com will accelerate deaths of third party shopping sites
August 26, 2000
Steve Blake, BlueOvalNews.com
If you own stock in companies such as AutoByTel.com or Autoweb.com, you might want to seriously consider selling that stock as Ford Motor Company's Ford Division partners with its dealers to launch the first of its kind online shopping service FordDirect.com.
FordDirect.com will utilize the most powerful brand in the automotive market, the Ford blue oval, to launch an assault on the third party shopping sites. The new service will bring dealers and the company together in a unified effort to allow online car buyers the ability to buy vehicles direct without any of the hassles, haggling or pressure most consumers associate with the car buying experience.
The negative effect of this new service will be felt with great force as most Ford Dealers will unsubscribe to the third party sites in order to focus their efforts and resources on FordDirect.com and because Ford Division has been the top selling automotive division for nine straight years, it could leave the third party shopping sites without any type of method to satisfy their customers that are looking for Ford Division vehicles.
Many third party shopping sites have already closed their doors or have been bought by the stronger shopping sites. It was just last week that CarOrder.com closed its doors for good because of their inability to purchase, in their words, "fledgling dealers to setup a distribution network that will spell the end of traditional type dealerships."
"This is a breakthrough," said Jim O'Connor, Ford Motor Company vice president, and president, Ford Division. "Earlier this year, our dealers came to us with a proposal to join forces and invest with us to build the biggest and best online direct purchase website," O'Connor said. "We're excited about it. FordDirect is a cooperative effort between us and our dealers. But the real winners are our customers. They can now buy a new car or truck online with confidence and peace of mind, knowing that the entire experience is backed by Ford and our dealer partners."
The new venture will most assuredly succeed as Jerry Reynolds, chairman of the national Ford Dealer Council and owner of Prestige Ford in Garland, Texas, has successfully rallied Ford dealers in strong support of FordDirect.com. The enthusiasm among dealers is unmatched regarding any type of Internet venture.
Reynolds said, "This is an unprecedented partnership between an automotive dealer body and a manufacturer. No other automaker can claim this level of cooperation with their dealers. We are breaking through the channel conflict that is sometimes caused by the Internet and giving our customers a great new experience."
Ford dealers have testified to spending $300,000, in some cases, to pay for referrals from the third party shopping sites and even though dealers will stay pay for leads coming from the service, it will eliminate the duplicate billing from external sources for the same leads as many consumers will utilize more than one online shopping service to obtain price quotes or purchase directly online. The resulting effect will be lower operational costs to dealers and cost savings for the consumer.
