Are Consumer Data Sales Probes About to Hit Auto Marketers & Dealers?


The Situation:  Data feeds from multiple sources about consumer behavior & buying habits are proliferating into the automotive market and sales channel. The scope and detail of this data is literally enabling OEM and dealer groups to “buy” pre-qualified customers including the exact kind of vehicle they are ready to buy at a given dealership.

The Real Situation: There is or soon will be no more sales funnel as we have come to know and love. Many have characterized the availability of this extensive consumer buying data aggregated and sorted by algorithms that predict and influence consumer behavior as the “end” of the Sales Funnel.  Qualified “buyers” are being delivered to the dealers with a complete history of the vehicle search process, the financial or credit standing of the lead, and much detail about the lifestyle, purchases, and preferences of ready-to-go consumer walking into the dealer showroom.

Year Long Congressional Investigation: Presently, the Senate Commerce committee is investigating several sites, including publishers like CondeNast and Time, about their collection of personal finance and family focused information and subsequent feeding of this information to large data brokers.

More Data Brokers in the Probe: Nine such data brokers have refused to identify their specific sources.  The data companies have not been cooperative in explaining to Congress, the business press, or the public how this massive data gathering industry works.

What this means to dealer management:  Two possibles– 1) The way that consumer leads are being delivered to dealers may be disrupted or dramatically impacted by revelation on how these leads are being generated. 2) More probes by Congress, the FTC, and the newly empowered CFPB may be on the way.  More so – the way dealer have been gaining leads and selling vehicles may be dramatically impacted.

What might happen with the Consumer Car Buying Process?  If and when consumers realize that 25 or more major Internet data companies have accumulated massive information about their purchases and activities on the Internet – and that this data and other data has been algorithmically matched up and then delivered to retailers, including automobile dealers – there may very well may be a massive backlash demanding that all the activities that now go on must be stopped.  Do Not Track and encrypted Web buying sites, and new disclosure may appear – or new compliance requirements and scrutiny.

Source: Financial Times, September 25, “U.S. Expands Probe Into Data Sales Industry”

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