Sept. 5, 2005 – Dealer Interest in Internet Services Increases
September 5, 2005
Filed under Features
Sometime soon, about the middle of September, if all goes well, the crew of PowerSports Network will move into their new digs, a 20,000 sq.ft., one story building in Sussex, Wis., a suburb of Milwaukee. In the greater scheme of things, a building that size isn't such a big news event, but this move is a little different. It reflects an important change in the way dealers are doing business today, in the way they are using the Internet to build their bottom line.
Steve Weiner and partners Nick Avgoulas and Keven Brandenburg launched Powersports Network in January 1998 when they saw a need to help powersports dealers build and maintain individual Web sites. It was slow going initially because powersports dealers didn't embrace the Internet, they weren't early adopters, and they just didn't think it was something in which their customers were interested.
After growing slowly the first several years, PSN spurted through the 1,000 dealer barrier this April and now serves nearly 1,200 dealers. Did PSN stimulate dealer interest, or did PSN benefit from growth in Internet use across the board? Probably a combination of both, but it really doesn't matter. The growth in PSN's dealer base reflects increased interest by powersports companies in using the Internet as a business tool.
Another reason for the increase in dealer counts at PSN is the fact that it's working closely with OEMs, Harley-Davidson, Polaris and Triumph, and is negotiating with several more. Participating OEMs generally make the entire process work better by providing promotional opportunities for PSN at OEM dealer meetings and including PSN costs in OEM co-op advertising programs, among other things. It's also easier for PSN to obtain machine specifications and promotional data from participating OEMs.
PSN also loads parts fiche from Suzuki , Yamaha and BRP; Polaris, Triumph and Honda are expected to be available in October..
PSN software allows participating multi-line dealers to present the appearance of an exclusive dealer Web site when the consumer comes from a participating OEM. “We've been able to create an exclusive environment for the OEM,” says PSN's Weiner. “If they come into the dealer's Web site from the OEM site, they go directly to the OEM's exclusive area. But if they come in directly, they can see all of the dealer's lines.”
From Weiner's perspective, OEMs are more willing to work with organizations like PSN then ever before because they see the advantages to dealers having effectively functioning Web sites. “Some OEMs are saying it doesn't have to be either or… a dealer site or an OEM site… it can be both,” suggests Weiner. “OEMs are becoming more committed to leveraging the Internet on behalf of dealers instead of just going after (the business) for themselves. They're taking a two-prong approach: They do it, but they help their dealers, too. It makes all the sense in the world.”
PSN also works closely with major distributors, such as Tucker Rocky Distributing and Western Powersports, to load their catalogs onto its Web site at www.psportsnet.com. The catalog data is available to participating dealers with only minimal work on their part, and the PSN connection is invisible to consumers.
On the dealer side, Weiner sees dealers changing their mindset from using a Web site as a static billboard that merely provides contact information to one that is much more of a sales tool.
“Probably 60%-70% of people who visit a dealership have been to their Web site first,” says Weiner. “They do their basic research on the dealer's site before going to his store.” One part of PSN's strategy is to extend the reach of the dealer's bricks and mortar facility by using the Internet. A well-designed Web site is one of the most effective ways to conduct business on a 24x7 basis, says PSN. Orders or quotes can be placed by customers any time at their convenience and then processed by dealer staff during slow periods in the business day.
Statistics compiled by PSN from its dealer Web site activity indicate that 51% of a dealer's Web site traffic occurs when the store is closed. Twenty-four percent of site traffic occurs on Sunday (12%) and Monday (12%), when most stores are closed, according to PSN statistics. Traffic on the site is up more than 30% over the same time last year when measured by unique individual visitors coming to the site, says Weiner.
Dealers also are willing to move their money into the Internet and away from other forms of advertising, he says. “It appears that they are shifting their advertising expenses to the Internet; they're moving from Yellow Page advertising to their Web Site because it does much more at a fraction of the cost.” Weiner says Web site expenses at 10% to 15% of a dealer's overall media budget are not uncommon today.
PSN's list of online features and services for participating dealers includes:
-Pre-owned vehicle listing. Dealers can load their own inventory of used equipment using photos and text. Inventory is automatically listed on the PSN site and can be uploaded to eBay and other selected sites.
-New vehicle showroom with pictures, specifications and MSRP.
-Sales lead manager for tracking leads from many sources.
-Customized catalog capability that allows dealers to create their own online sales materials.
-Parts fiche with parts number search.
-OEM promotions; dealers can select which promotions they want to run on their site.
In the last year, PSN has continued to innovate and upgrade its offerings. It's added the new vehicle showroom and this month it's rolling out a PDA feature that enables dealer personnel to check inventory from the floor if the dealership has a wireless network. It also can be used to enter sales leads. “It can be a big help to sales reps on the floor,” says Weiner. “It's easy for them to answer a customer's question. That's how we try to leverage technology to make reps more productive.” The PDA product is expected to be available in October. Pricing hasn't been set yet.
PSN's Web site service starts at $225 per month and costs less than $500 per month for its complete package.