RE: Autobytel

[John Braithwaite]

Sam Said:

Doesn't it depend on the value (to Autobytel) of each transaction? If

they're making a couple of thousand dollars on each sale, then it's probably

a reasonable conversion factor. I'd be surprised if it was much higher if

the main trade is very high ticket items like cars....or am I missing

something?


JB writes:

Hi Y'all


Having entered discussions with A-B-T about 3 years ago when I was working

as the MarComms Manager for a large dealer group in London, their business

model really wound me up.... because the way it is structured means that as

long as they have a big market share in the Online car 'request' market,

they will only get bigger.


Basically, they go to the dealer and say to them: "We want you to buy <this

area> (say 'East Croydon') for £x,000 per annum" during this time we will

invest half of what you pay us into advertising and keep the other half for

ourselves. However any enquiries that come through for that region are the

dealers'. If you realise see that there are about 20-25 car brands in the UK

and it's split up into hundreds of areas - you can see the revenue stream

(or torrent). They are very nice blackmailers who say, basically, if you

don't get this business then we'll refer it to someone else. However, at the

moment, they are being hindered by the current 'rip-off Britain' attitude to

car buying - but, due to their pricing, they're less concerned about what

the car is sold for (although it has to be a 'best price' offer).


Funnily enough, they were the first .com to book the 'SuperBowl' advertising

slot - to enormous success - which led to all those others to assume that it

was the 'killer app'. 


Cheers



John B