TRUE CAR and ZAG Cyber Bandits, Parasites or Good for the Car Business?

Jim Ziegler asks...

I am hearing a lot of discussion about True Car and ZAG.  I continually scratch my head and wonder if  desperate dealers are doing the marketing limbo "How Low Can You Go?" 

Are we so bad at what we do that we have to line up and pay vendors to lose money? AND, who is giving these people access to your data that is used against you? 


Who owns these companies and what might be their ulterior motive?  Sometimes I ask questions to which I already know the answer. 


Am I wrong?

What do you think... JIM



Jim Ziegler's Guidance and Recommended Action Plan:

Ten Areas We Need to Concentrate on to Bring This Monster to It's Knees...

  1. Government investigation of ALL Data Aggregators taking consumer information from dealers' DMS. Sadly enough, dealers who do business with TrueCar are exposed to  liability charges. Cut off all access to unecessary data, no matter who takes it from the dealers DMS and make it illegal to "resell identifiable consumer data" and "transactional data".
  2. Educate Your Fellow Dealers; If anyone takes financial transactional data, they expose the dealer that allowed it to violations, especially if it is passed on to other vendors or shared.
  3. Educate Consumers to what they're doing with their information...
    a. You buy a car from a dealer, do you really want your personal information, and maybe even your financial information, passed along and sold and shared by "God knows who?"
    b. These People Charge the Dealer $300 which the dealers have to build into the deal
    c. Your Privacy and the Security of your Information could theoretically compromise your identity if you do business a company that takes data from the dealership.
  4. Educate Investors and potential investors they could possibly be mislead if anyone is telling them this is a safe investment because of all of the dealers pushing back, associations pushing back, and government regulators in many states coming after TrueCar's business model as NOT compliant, in some cases they're saying it is Not Legal.
  5. AMEX, USAA and all of their affiliates do not want the bad consumer relations this push back is creating with their members and customers.
  6. Cancel your dealership's Affilation with TrueCar. Tell people with TrueCar certificates that YOU don't honor TrueCar and you feel the company is NOT reputable. Educate consumers as to perceived data exposure if they buy from a TrueCar dealer. Make sure that each consumer knows that using TrueCar actually increases their vehicle cost by $300 to $400.
  7. Make the dealers selling at huge losses take all of those deals. Big problem right now is too many Nissan Dealers and others are taking huge losers to get the factory money. The TrueCar reverse-auction business model will continually push those numbers down until the factory money is non-existent. Consumers need to hear from many dealers, "We don't do TrueCar"
  8. Keep calling your National and State Dealer Associations demanding they get involved and stay involved... No excuses.
  9. Get the Manufacturers into the game. If GM, Ford, Toyota, and other majors change the rules about how we advertise and do business to protect the dealers, we can cut off their ability to set pricing. So keep it up at every dealer meeting. Call your Dealer Council Members and protest to your factory reps. Tell the manufacturers, if they want showroom and facility improvements, we need the ability to make fair profits.
  10. Tell everyone you know. Educate other dealers and industry people. Watch the Painter interviews... I believe this is the first time a vendor has publicly announced they intend to bring down the dealers and hijack our business, taking our profits and starving us out with our own data. Painter has said manufacturers and dealers should go bankrupt and he, in his God-like way "will control distribution..."
    When the TrueCar-Yahoo Deal kicks in we need to stand firm and "Just Say No" we don't honor TrueCar deals.

Read this article as a reference 

AND, if you doubt the mission... read this...

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Comment by Ed Brooks on April 11, 2012 at 3:45pm

@Keith - this goes back to your help / hurt sales question. There is no doubt that digitally savvy dealers reap the benefits of SOME data pulls - online classifieds and the the like. If no data at all were to be extracted, we'd go back to the days of traffic being generated by who the biggest inflatable Gorilla or spent the most in the newspaper.

I think the better question might be, can we LIMIT what data is pulled and HOW it is used.

Comment by Keith Shetterly on April 11, 2012 at 3:16pm

I should've said that phone call came from Jim!

Comment by Criss Castle on April 11, 2012 at 2:14pm

With the keen focus on Red Flad Rules, there is strong liability in identity theft protection.

Contracts with vendors should have a liablity clause that points to vendor responsiblity AND liablity AND insurance protection as well as notification requirements if information is compromised.

Comment by Keith Shetterly on April 11, 2012 at 2:13pm

@ All (especially George):  If the data was stopped today, via DMI or otherwise, would we make more or less sales?  I had an interesting call just now that postulated that we will sell 14million cars whether these guys are in it or not, and that the profit is the only thing that gets "chopped" and then "moved around" between dealers by data aggregators and their partners.  Essentially, that they use our data to steal from our profits we would get anyway, and that they also then partner with (charge) particular dealers in their network to just use the data on the dealer's "behalf".

What do you folks think of that argument?

Comment by George O'Sullivan on April 11, 2012 at 2:07pm

@Criss "They do come out of the woodwork"

@Keith There is no question that DMI should be in business and that they provide a valuable service.  I am not calling them the enemy.  But if they download, cull and aggregate the data from my system so that they can resell it. Then they can assist those that are working against us. 

If someone is going to use our data for anything, We have the right to know!

Comment by Keith Shetterly on April 11, 2012 at 1:23pm

Thanks Jim!

Comment by Keith Shetterly on April 11, 2012 at 1:23pm

DMI is in Austin, about two hours from my door.  I suppose I could drive over and knock on the door, so to speak, and ask about all this.

Comment by James A. Ziegler on April 11, 2012 at 1:22pm

We're still about three weeks ahead of the first major shot being fired in the Data Wars... are you guys ready? We're about to rain on their world(s). I've been quiet but behind the scenes a lot going . Thank all of you for carrying the torch here. JIM

Comment by Keith Shetterly on April 11, 2012 at 1:15pm

It's not an "on/off" problem.  It's a "help/hurt" sales question.

Comment by Criss Castle on April 11, 2012 at 1:10pm

@George, so bottom line, if the vendors are cut off and forced to find alternatives, they will.

Instead of "Build it and they will come."

our new motto should be:  "Cut Them Off and They Will Conform."


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