General Motors is ending its 6-week-old team-up with eBay in which the automaker sold cars in California via the online auction site and learned some valuable lessons.
Lance WhitneyContributing Writer
Lance Whitney is a freelance technology writer and trainer and a former IT professional. He's written for Time, CNET, PCMag, and several other publications. He's the author of two tech books--one on Windows and another on LinkedIn.
General Motors' pilot program to sell cars on eBay has reached the end of its road. The automaker said it's concluding the program as scheduled, effective Wednesday.
Launched on August 11, the eBay Motors pilot program offered California auto buyers new GM cars, which they could either negotiate for or "Buy it now" at the discounted selling price.
Initially set to expire September 8, the program was extended by GM until the end of the month.
The financial success of this pilot may be difficult to gauge. Earlier reports suggested that few sales were being generated. But GM discovered that tracking actual sales was more challenging than expected.
"Nobody's ever done this before, to sell new cars on eBay," said GM spokesman John McDonald. "So the whole point of the pilot was to learn some lessons. And one of the lessons we learned is that it's very difficult to track sales if they're not made directly through eBay. Unless you can tie a sale to an eBay interaction, it's difficult to come up with sales numbers. So we learned that we have to find a better way to (track sales.)."
The company has been encouraged by the figures it was able to track. Around 16,000 vehicles were listed online for the pilot, with more than 225 dealers participating. GM's eBay Motors site attracted 1.5 million visitors during the six-week period, said McDonald, with a total of 1.9 million searches conducted for vehicles. More than 15,000 leads were generated for dealers from potential new car buyers.
"The real intent of the program at the time and the reason we did it in California was that we wanted to raise awareness and consideration of GM products among people who wouldn't typically shop GM," said McDonald. The company wanted to target people who wouldn't normally go to Chevy.com or Buick.com, but would go to eBay to shop.
"Being the first manufacturer out there to put new vehicles online, I think in just that six-week period, it shows you that there were a lot of people looking at these vehicles who weren't looking at those vehicles before," said McDonald.
Unlike the typical eBay seller, GM wasn't auctioning off vehicles at bargain-basement prices, which may have dissuaded some buyers. "We're not fire-selling vehicles on eBay," explained McDonald. "There's a certain amount of user education in that, and a certain amount of dealer education."
A story in Wednesday's Wall Street Journal (subscription required) reported that some dealers found they wasted time pouring through unrealistically low-ball bids that would never result in an actual sale.
McDonald said he understands where the dealers are coming from, and that's something GM can learn from if the company decides to roll out the program nationally next year.
"But the interesting thing about the comment is that they're interacting with customers who didn't even talk to them before," said McDonald. "Is it an offer that you may not be able to take? Probably. But are you talking to someone who wasn't even looking at GM products before? Yeah, you are. So now you've established a contact, and that's a big part of what we were trying to do with the program."
McDonald said a number of dealers liked the chance to extend their showrooms online. But reactions varied. Dealers who already used the Internet as part of their business knew how to work with the program. Dealers who weren't already online ran into more difficulty.
For its next step, GM will review the customer and dealer feedback and the lessons it learned to see if this program can fit in with the company's marketing plans moving forward. McDonald is optimistic. "We'd love to work with eBay next year to do something on a national level," he said. "But what that looks like and what the timing would be will depend on the results of this test."
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