Digital transformation is disrupting the traditional model of car dealerships; however, for those who implement new technologies advantages can be gained. Artificial intelligence, for example, can aid car dealerships in many ways, such as analyzing trade data to gain new insights and to assess customer data to help to predict consumer behavior. Such information also assists with business-to-business transactions.
As well as introducing artificial intelligence technology, PureCars has worked with Raycom Media to develop a digital advertising strategy.
To discover more about the digital strategies affecting car dealerships, Digital Journal spoke with Sam Mylrea, CEO of PureCars.
DJ: How did you get involved with PureCars?
Mylrea: The founder and the board of PureCars brought me onto their team at the end of 2013 after PureCars raised some initial capital. They were looking for someone with my background in finance and growth-stage investing that also had operational and startup experience.
I was first hired at PureCars to help grow, scale and professionalize the business and maximize enterprise value for an eventual exist. Now, as we help dealerships grow and improve their business, it’s rewarding to see much our own team has grown and the success PureCars has seen internally.
DJ: Could you describe how PureCars’ is using artificial intelligence to help car dealerships drive sales?
Mylrea: PureCars is always striving to execute the most relevant marketing campaigns for dealerships, and our AI-driven technology allows us to leverage tremendous amounts of consumer data to help dealers improve every point of the buyer journey. Our platform uses AI not only to gain insights, but to turn that data into a holistic view of what’s working (and not working) in regards to sales. It’s all about serving the right ad at the right time and on the right device, and PureCars is constantly looking at new customer data, actions and behavior to improve our model and predictive insights.
Our AI technology can also be used for inventory management purposes. Unmoved inventory that sits on a dealer’s lot is costing them hundreds of dollars each month in interest. But by using AI, dealers can better understand which cars to stock based on consumer behavior and past purchase patterns. Armed with these insights, they can use individualized marketing efforts to target the right customer at the right time — resulting in purchase and alleviating excess inventory.
DJ: How has PureCars’ technology evolved since launching?
Mylrea: PureCars’ platform now provides more data than ever for automotive marketers, improving decision-making and generating better results. We have developed a more comprehensive understanding of how the consumer researches, shops and eventually buys a car, and with that understanding we’re able to better target, reach and influence the end consumer.
Initially, our product was built to use data to better target and reach the right consumer, but the most recent evolution of our product has been using data and technology to better understand what to market. The idea behind our SmartAdvertising solution is to connect the dots between informed business intelligence and advertising, essentially using real data and intelligence to execute an advertising campaign rather than gut or intuition.
DJ: What have been some of PureCars’ biggest milestones?
Mylrea: First is establishing a dynamic inventory. PureCars has built one of the largest data warehouses in the industry that’s able to understand the composition of all models across all relevant years. This information allows us to programmatically understand and create the best ad unit dynamically based on the end customer’s inventory.
Second is with market intelligence. Once we solved the problem of creating the best ad unit, we wanted to have an intelligent approach of what we should/need to advertise. Dealers have a finite marketing budget, and we wanted to look at various market signals like market supply/demand, days on lot, pricing, etc. to determine what vehicles we should advertise to eliminate waste and maximize ROI for automotive marketers.
The third milestone is the creation of an omnichannel. The last deficiency we solved was the capability to execute campaigns across all relevant media channels and devices. The consumer path to purchase a vehicle is approximately 6] days, and the journey doesn’t just live on one media type. Consumers are influenced across 24 different touch points, 19 of which are digital. PureCars knew it was essential to be able to deliver the right message about the right vehicle at the right time, on the right device and on the right media channel.
DJ: Are there any specific customer success stories that you would like to share?
Mylrea: Ricart Automotive Group, a large dealership we work with, has used our digital solutions. They have attributed almost 25 percent of their Fixed Operations business back to the strategy and execution that PureCars provided.
DJ: How did the deal between PureCars and Raycom Media come together?
Mylrea: Raycom Media approached PureCars initially about the acquisition. Their biggest advertising segment is automotive, and they wanted to expand their digital footprint. They actually surveyed a large percentage of their automotive customers and PureCars kept coming up as the leading provider and innovator in digital advertising.
We weren’t necessarily shopping for a buyer, but the team, culture and the potential support/backing we could receive was very intriguing. Raycom really believed in our vision and pledged to let us operate autonomously and provide the support and resources needed to continue executing our vision of building the best digital advertising platform for the automotive industry.
DJ: What has been some of the customer feedback that PureCars received so far?
Mylrea: Customer feedback has been phenomenal for PureCars. What we do is very complicated, and it’s our duty and responsibility to make digital marketing and advertising easy for our end customers. That said, issues and mistakes happen given the sheer complexity of what we do, but we’re always striving for constant improvement and the development of new technology to prevent and/or minimize any issues from having material impact.
I think one of the best parts about our organization is that PureCars is dedicated to both technology and customer support. Without strong execution across both of those fronts, we wouldn’t have the success we’ve experienced to date. You can have the best technology in the world, but if you don’t have the support to back it up and effectively communicate your value proposition, it’s worthless. The inverse is true as well — if you have phenomenal support, but don’t have the resources to invest heavily in data, technology and processes, your performance won’t be market-leading and your customers will find a vendor that is.
DJ: What distinguishes PureCars from its competition?
Mylrea: PureCars lives and breathes in a very crowded and competitive space. I believe our company continues to lead our industry forward, based on three core elements: Focus, People and Technology.
We have a tremendous amount of focus on building the best digital advertising platform, specifically for the automotive industry. Rather than build an agnostic platform that can be used by multiple industries, it was our focus that enabled us to build the best platform in automotive. Within the industry, there’s a tremendous amount of data, variability and complexity that we just wouldn’t have been able to solve without true focus.
PureCars also has a strong commitment to technology. I’ve seen a lot our peers enjoy rapid growth through massive sales organizations to the detriment of technology investment, but this eventually fails when the customer realizes performance isn’t there to back up what was sold. When you look at our organizational chart, less than 7 percent of our employee base is focused on sales. The vast majority of our employees are focused on developing market leading technology, customer support and performance.
DJ: How about culture? This is often seen as key to digital transformation.
Mylrea: PureCars has always invested heavily in it’s people, and in return, we’ve benefited from our people contributing their time, passion, creativity and hard work back to the company. We’ve really worked hard at identifying and retaining top talent and have an excellent track record of keeping our key contributors. I believe culture isn’t created by having catchy phrases written on your office wall, but needs to be instilled by the people you hire and exemplified by your leadership team in everything they do.
DJ: What are some of PureCars’ future company goals?
Mylrea: At the end of the day, we want to help the dealer sell more cars, and we have tremendous amounts of data that we want to empower them with. From how they merchandise, price, stock, market and ultimately sell their inventory, we have data that can enrich, advise and improve each key component of the buyer journey.
Attribution has also been a big focus for us and the industry. Buying a car is the second largest purchase most consumers make after buying a house. Manufacturers and dealers spend significant marketing dollars with very limited insight on what/how campaigns are performing, given the difficulty in connecting online to offline activity. But with the attribution technology PureCars is developing, we’re now able to see how each advertising campaign contributes to the end sale. The data/results are incredibly informative and not only help the dealer more effectively allocate their marketing dollars and cut waste, but also allow us to see the full picture and therefore increase performance holistically.
