If dealer groups are using the same data suppliers for market information, vehicle desirability and pricing, inevitably, it raises the question of whether it produces a negative effect.
It’s not difficult to imagine a scenario where dealers end up bidding on the same stock artificially inflating prices of certain vehicles whilst inadvertently reducing customer choice as forecourts begin to resemble each other.
Meanwhile, if the same algorithms influence dealer decision making, the logical conclusion could be a race to the bottom scenario as vehicles are priced to the same market.
How shared data can erode margin
Autofinity’s ViHUB platform consolidates information from multiple vehicle datasets to create one rich data source on an individual basis for every car in stock. As well as overcoming inconsistencies and inaccuracies, pooling several data points deliver what CEO Andy Whitehair describes as ‘as single view of truth’ for each vehicle.
He said: “If every group prices off the same signals, they all reach the same answer at the same time, so they compete for the same cars and discount the same stock. The market data isn’t the differentiator as it’s available for all to purchase.
“What dealers know about their own vehicles and their own customers is the key. That’s the dataset nobody else has because it is unique to each vehicle, let alone each business, but most retailers can’t see it because it’s spread across five systems.”
Founded by CEO Chris Porter, Nexbotix automates dealer processes to overcome repetitive manual tasks. AI enables the integration of various business processes boosting smart working and cost effectiveness.
Porter said: “Everyone’s working off the same data now, so the edge isn’t the data, it’s who can act on it fastest.
“The desirability scores, the market feeds, CAP – every group is looking at more or less the same numbers. So, the data itself has stopped being the advantage. If everyone has the same information and buys the slow, manual way, they all reach for the same cars at the same time and compete the margin out of each other.”
Speed turns data into an advantage
For Porter, the ‘genuine edge’ is the dealer who turns that shared data into a disciplined bid first, at the right price, not the panic price, and gets the car. Porter maintains by applying the same practice to their own forecourts and not the market average means dealers will be stocking for their own customers.
Nexbotix has developed AutoBUY to undertake the task by scanning auctions, classifieds and private listings around the clock, matching availability to vehicles selling for the group, setting a disciplined ceiling on every bid so it never overpays.
AutoBUY bids the instant auctions open, faster than any human watching a handful of screens. The buyers are freed for the complex, judgement-heavy acquisitions that genuinely need a person.
Hartwell installed AutoBUY and experienced a 20% increase in the right used-car stock which, in turn, lifted margin by 50% on every vehicle whilst ROI was achieved inside five months.
Porter said: “The dealers who win aren’t the ones with a secret dataset, they’re the ones who can act on it around the clock and bid the second a car comes up, without ever overpaying. That’s a machine’s job, not a person’s.”
Fresh local data drives buying
Chris Healy, head of commercial at Carwow identified three key elements that sets a dealer apart: granularity, freshness and speed. Knowing postcode-level demand rather than broad regional averages gives dealers an edge, as does acting on live buyer and seller activity happening on Carwow’s marketplace today, rather than relying on a monthly trade guide.
He said: “Ultimately, the dealer who moves fastest on a signal captures the margin, even if a competitor spotted the same headline figure. This is why we combine data trend features such as Carwow Wallet, which supports pre-authorisation for stock-sourcing, so dealers have fluidity to buy at speed and maximise profit potential.”
Healey added: “Carwow data stands out as it is a closed loop, the same platform holds data across the entire car changing process. By recording the car being listed, all enquiries and dealer bids for similar vehicles, we have a complete picture of demand for each vehicle.
“This can be turned into curated, daily, weekly, monthly quarterly insights rather than another raw feed for a dealer to interpret with their account manager. Carwow data is designed to deliver actionable insights with real life performance indicators rather than just data points.”
Customer insight breaks the tie
Alistair Jeff, head of Toot Cars, a soon-to-be launched used car concept from MOT, repair and servicing comparison website BookMyGarage, believes the most valuable data indicating customer action sits within the ownership journey itself.
He said: “Service bookings, MOT activity, repair decisions, rising maintenance costs and changing vehicle usage can all provide valuable signals that help retailers understand future demand before it becomes visible in traditional market data.
“If every retailer is buying stock from the same market signals and pricing against the same algorithms, then genuine competitive advantage becomes harder to find. The retailers who succeed over the next few years will be those who combine market intelligence with their own unique customer insights.
“In simple terms, they’ll know not only what the market wants, but which of their existing customers may already be approaching a natural vehicle change moment.”
Toot Cars aims to realign sales and aftersales in one vehicle ownership continuous journey.
“A service isn’t just a service. An MOT isn’t just an MOT. A repair decision isn’t just a repair decision. These are moments where customers are actively evaluating their vehicle, its value, its reliability and whether it still fits their life. When retailers can connect those ownership moments with stock strategy and customer engagement, entirely new opportunities emerge,” he said.
Ultimately, according to Jeff, the future used car operation may be less about predicting what cars people might buy, and more about recognising when existing customers are ready for a conversation.
Jeff said: “Competitive advantage won’t come from having access to the same information as everyone else. It will come from combining market intelligence with unique customer insight. That’s where the future of intelligent automotive retail becomes really exciting.”
Register for AM’s Innovation Week webinar
This issue will be explored further during AM’s free webinar, Identifying the innovations that count, at 2pm on Thursday, 24 September.
Our expert panel will examine how dealership leaders can distinguish technology that produces a meaningful return from tools that merely add another layer to an already crowded technology stack.
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