General Motors ( G M) And Cobalt Websites The Big Rip Off And The Slow Deception


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General Motors ( G M) And Cobalt Websites The Big Rip Off And The Slow Deception

  1. 1. General Motors (GM) and Cobalt Websites -The Big Rip Off an... Search or Keyword Search Home About Archives Job Board Advertise Contact Newsletter RSS Categories Ask / Answer Automotive CRM & ILM Best Practices Industry Announcements Internet Dealer Marketing Internet Lead Sources Internet Sales Tools Latest News & Trends Opinions & Advice Reputation Management Search Engine Marketing Seminars & Webinars The Other Stuff Uncategorized 1 of 17 3/12/09 1:37 PM
  2. 2. General Motors (GM) and Cobalt Websites -The Big Rip Off an... Recent Comments Stan Sher says "I think that any dealership website can be more..." mietwagen says "Sehr gute Seite. Ich habe es zu den Favoriten." Frank Davis says "Hello John Thank you for the post and the..." John Lewis says "Frankly, all the website companies are the same..." Andrew DiFeo says "After reading Dale’s book, Velocity, it..." Jeff Kershner says "Always a huge fan of Dale! How many dealers..." Alex Snyder says "Thanks Dale - your insight into the used car..." Alex Snyder says "Roland - I was actually admiring your post for..." Gardson says "Don’t you hate spam to?" David Book says "Great post, I enjoyed it and laughed several..." Frank Davis says "I want to thank everyone for all the positive..." John Kimel says "You can add Volkswagen and Audi to the list of..." Justin Duff says "Great post. I liken this to going into a Chevy..." car donate says "Is it a good time to be doing this with the state..." John says "Just stumbled on this post and thought I’d chime..." Matt Watson says "I think it is good for the OEMs to mandate..." Rob Melone says "Audrey, That is a great article. I have started..." Amanda Marsal says "themselves!! I hate that…" Questions Have a question for myself or the community about dealer websites, lead vendors, crm/ilm or something general about Internet sales? Email me, and I'll post it on the site. Knowledge YouTube: An Insi… Alan Lastufka, Michae… $19.79 Made to Stick: W… Chip Heath, Dan Heat… $16.50 2 of 17 3/12/09 1:37 PM
  3. 3. General Motors (GM) and Cobalt Websites -The Big Rip Off an... Flip Video Mino S… Pure Digital Technolog… $152.00 Great for vehicle walk-arounds and customer testimonials! Tribes: We Need … Seth Godin (Hardcove… $13.57 Purple Cow: Tran… Seth Godin (Hardcove… $14.25 1234> Privacy Web Tools Alexa Blog Flux Directory Compete Google Dance Tool Google Keyword Tool IP Tracker Keyword Density SE Spider Simulator UrlTrends Website Grader Whois Source Yahoo Site Explorer General Motors and Cobalt Websites-The Big Rip Off and the Slow Deception 3 of 17 3/12/09 1:37 PM
  4. 4. General Motors (GM) and Cobalt Websites -The Big Rip Off an... Posted by Guest Poster | Sunday, March 8, 2009 | Posted in Opinions & Advice Guest Posting by Frank Davis Cobalt and GM Dealer Websites I believe what you are about to read will open your eyes to the waste and mismanagement at General Motors and Cobalt websites. We have to start at the beginning of the fiasco a couple of years ago when GM had realized that the Internet was a boom that was not going away, not only that, but would flourish year after year. Not being in the “internet business” They decided to hire a company that was supposed to exceed in online marketing and advertising such as Cobalt websites. They had decided that it was very important to send out the same message; they wanted the consumers to receive consistent relevant messages and obtain the same information from one source. Ok, now let’s look at the plan they created and put into action. It was and is a great plan with some very devastating failures built in. General Motors and Cobalt decided that unless you have a website by Cobalt you would not get a link from any GM advertising such as or from Onstar mailers for people that purchased a GM vehicle. That was a great idea for Cobalt because now they had the first monopoly on websites for General Motors. They may say it is not a monopoly and that you can have any website produced by any website company you want, but the importance of links from the manufacture sites to the dealer sites is so relevant that if you do not have these links it will not only cost you new business but also repeat business. Let me give you a couple of brief examples. You are a consumer visiting, you are searching for a particular vehicle doing your research on incentives etc and you come across a link to search dealers inventory (remember no cobalt website no link), you find a dealer in your area click on that link and search that dealers inventory. So in this instance, a dealer without that link can potentially miss out on a huge customer base by not having that all important link on the Chevrolet website. Even though that same dealer pays into the same advertising funds as his/her co dealers. Most dealers do not even realize this as they take the easy way, not understanding internet marketing, they take the word of the professionals at General Motors and Cobalt, but what they do not see is the right to CHOOSE has been ripped away from them as you are severely penalized for not using Cobalt websites. Another example is when a consumer purchases a vehicle that has Onstar installed, that consumer receives e-mail updates that have relevant links back to dealer website (only produced by Cobalt), so if you do not have that Cobalt website you will not get the relevant links back to your dealership costing you potential service revenue and sales revenue. So the potential for severe loss of income over the years is over whelming to say the least. Let’s take a look at the waste that is being made everyday online from General Motors and Cobalt websites. Somewhere about 2007 Cobalt came up with a plan and somehow convinced someone at General Motors that they would get all of the dealers onboard the internet band wagon. First they would give all the dealers a “free website” General motors’ would pay for that, as Cobalt executives pointed out that if GM paid for those websites and sent out the same message then it would garner more sales for GM. So the idea was sold and bought by GM, Cobalt would build a distribute the websites and GM would pay for them as they would be free to the dealers. Cobalt also would do free search engine marketing for the dealers, also paid by GM for its dealers. But seriously folks if you believe for one minute that any of this was free then please rethink, and remember there is nothing free in this world, there is always some cost somewhere and here is where it was paid from: 4 of 17 3/12/09 1:37 PM
  5. 5. General Motors (GM) and Cobalt Websites -The Big Rip Off an... “THE DEALERS ADVERTISING FUNDS” Yes everything you thought was free is paid for by the advertising fees on the invoice. Every car sold, paid for those dealer websites. This new program is called the iMR program and is nothing short of a huge scam and waste by General Motors and Cobalt. Let’s look at the one most wasteful use of advertising funds: Pay Per Click advertising or search engine marketing. Now remember this was also promised to its dealers for “free” but of course is not free as it is also paid for by the advertising fees listed on each invoice. The concept here is very simple, and has to be one of the most wasteful plans put into action by any corporation this decade. What I am about to prove to you not only is wasteful but also has to be one of the most “IGNORANT” plans put into action by General motors and I say ignorant as they are obviously blind to the massive waste of advertising dollars. The idea is simple: place paid search advertising at the top of search engines using the dealership name and when it is clicked on have it point to the dealership’s Cobalt website. Seem reasonable? Well let’s take a better look at it. If you type in a dealers name into Google, Yahoo etc, on that first page, that dealers web pages will fill the whole first page and second and so on, this could actually go on for hundreds of pages. So why would you pay for a search campaign using a dealer name when it will show you all relevant pages without paying for it? Does this paid search benefit the dealer? Does this paid search benefit General Motors? Nope, there is only one self serving reason to have this search in place and that is to benefit Cobalt website company as they get paid to implement and run that campaign, so the more clicks the more revenue, oh sure a large part of that goes to the web server but if you think it does not profit Cobalt then please think again. This type of campaign also helps Cobalt reassure GM that it is relevant by all the hits that it receives. Excuse me Cobalt and GM but wake up, don’t you think if you typed the name of a dealership you would click on one of the very first ones to show up to get to the website? So why pay for something that you get organically for free? It all comes back to waste of advertising dollars and most probably hundreds of thousands in advertising costs that could be put to much better use, such as: when some on types into a browser “Joe Schmoe Ford dealer”. Now a pay per click campaign going after that search term and name makes sense if it has the correct message as it is directed at a consumer looking at the competition. So if you can redirect that consumer then you would have a successful pay per click campaign and one that would not be a waste of advertising dollars. All of this only serves Cobalt websites as a monopoly; it does not serve the dealer or General motors. If you take a close look at the reporting analytics of Cobalt with an open mind, you would see a unreliable analytics as the way they report only benefits “Cobalt”. Such as viewing a consumer who looks at hours and directions on the website as a viable conversion. In my expert opinion, your conversion from a website is “a hard lead to a dealer from the website with a name, telephone number and e-mail address, and or a telephone call to the dealership. There is no other conversion, so to grossly report otherwise is only to show untrue numbers in reports. I have been asked what does it matter where the leads come from. Let me explain that everything matters when advertising on the internet. One of the main reasons it matters where the consumer goes 5 of 17 3/12/09 1:37 PM
  6. 6. General Motors (GM) and Cobalt Websites -The Big Rip Off an... is what is called a conversion ratio. If a dealer has a website that truly converts 10% to 13% of its website visitors compared to a website that converts 5% of its website visitors, I have to ask where would you want your consumers going. One very ironic rule in place at Cobalt and General Motors is everyone that has a Cobalt website gets the pay per click campaign even if they do not want it. It is forced on the dealer. So in essence what happens is Cobalt is stealing from the dealer and using the dealers advertising for their own benefit, not for the benefit of the dealer, not for the benefit of General Motors but only for the benefit of Cobalt. And the sad thing, is it comes from General Motors because a salesman sold the idea to some Bimbo at General motors. So if you are a dealer and you ask Cobalt and General Motors to remove that pay per click campaign they will say “no”, everyone gets it. So if you trademark your name and tell Cobalt and General Motors not to use it as it is trademarked they just ignore you and do it anyway. In essence, if you are a GM dealer, GM is going to allow Cobalt to steal from you. Although you might say it is ok, it does not matter, I have news for you “it matters” when someone gains a monopoly and directs your consumers that you advertise for, to a website that will deliver a message that is all one sided. Just to put a little humor in the situation type in Chevrolet dealers Dallas, every dealer website that comes up on the first page is built by Cobalt websites. Now if I was a Chevrolet dealer in Dallas and I was not in the top three, I would want to know why not. Who makes that determination? It all has to do with search engine optimization and when you have one website company building the same websites for everyone then you get the same results stacked on top of each other and then there is no competition. If they are all the same with the same message why would you visit multiple dealer websites, it would just be a waste of time. So essentially, taking out not only the competition between dealers but sending the same bland message to the consuming public. Which is what General Motors in all of their infinite wisdom wants. Here is more humor, Cobalt websites for a fee will implement a secondary pay per click campaign for you, meaning they will do sponsored search for terms they or the dealer deem relevant, so if you have let’s say three dealers all within 20 miles of each other with the same website, the same message, and the same pay per click campaign then what do you have? General Motors might say the same message, but what does that do for the dealer? But also what message is really conveyed to the consumer? They are all alike? No reason to go anywhere else? What makes one dealer unique from the other? In that competing pay per click campaign, who determines who is going to pay more, and what about when campaigns are focused on other dealers with the same makes and models and not the manufacture competition. General Motors and most importantly the GM dealers need to take a real hard look at their online advertising and search placement. For more information or if you would like to debate this issue please feel free in contacting me direct. About the Author: Frank Davis is a Director of Internet Sales and has over 10 years experience of automotive Internet sales and marketing. ShareThis 19 Comments Anonymous 6 of 17 3/12/09 1:37 PM
  7. 7. General Motors (GM) and Cobalt Websites -The Big Rip Off an... March 8th, 2009 I do not want to share my name because who knows what the repercussions could be if someone at GM saw the reaction. However, you hit the nail on the head!! The only thing MORE WASTEFUL than IMR is the LMA and that would take another 2 page article! Let the dealers do what they do best. QUIT getting in bed with VENDORS!!!! Jon Groenig March 8th, 2009 I agree with you Frank, I was working at a GM dealership when they started pushing the free website from Cobalt. I was in the process of getting a website put in place and had to justify spending $900 versus the free site. We had a management meeting to compare the two websites side by side, by the end of the meeting they had decided that while losing the links was a negative, they would still rather go with the site because the look, feel, and navigation were much better than the options that were available from Cobalt at that time. A dealers website is a major part of their online presence and they should be able to decide who they want to use, they shouldn’t be told “use our piece of crap or you won’t get our links”. Umer Farooq March 9th, 2009 @Frank… excellent piece. From my understanding… the “free” program is no longer available. Is that correct? Frank Davis March 9th, 2009 Umer,,,,,You can still have the “free” website with Cobalt. You do not however get the support person unless you pay the 299.00 fee they implemented at the first of the year, They sent out a memo with a bill attatched charging the 299.00. If you choose not to pay the charge then they will still keep the website up and give you the “free” pay per click advertising using the name of your dealership redirecting to the Cobalt website. You can get support from Cobalt if you are not paying the 299.00 but they claim you lose more than you gain, huh? Another idea was to up sell other services and products once the dealer is on the “free” website and I am sure it has worked. Brilliant plan as I had said give em free stuff but really charge them for it, then up sell the real good stuff, Great plan, awesome monopoly. Kevin Frye March 9th, 2009 Frank, I sense your frustration… I would venture to offer this. I believe much of the reason that 7 of 17 3/12/09 1:37 PM
  8. 8. General Motors (GM) and Cobalt Websites -The Big Rip Off an... GM started with the mandatory Cobalt sites was to bring a lot of GM dealers into the “modern era”, as there were still LOTS of GM dealers that had not grasped the importance of the Internet yet. I can tell you in my area that at least one GM dealer had a website that one of their employees put up on their own because the owner didn’t see any value in the Internet (and it was not a good website…). There were lots of GM dealers with no websites, or very poor websites across the country. This approach by GM brought some standardization across their brands and got dealers to get “onboard” with the Internet. In GM’s defense, I have seen a tremendous improvement in their emphasis on being aggressive and good on the Internet. I work with 15 brands, and I would place GM in the top 3 brands for OEM support for the Internet. With all that said, we still have separate websites for our GM stores, and keep the Cobalt one for the OEM link (I agree, you must have). I also agree that the pay per click using the dealer name for the search terms makes no sense (but makes lots of dollars for the vendor hosting the ppc…). In a perfect world, we could have our own websites linked to GM’s sites - but I would imagine that GM would want some requirements met (fair enough) to ensure quality for all of their stores…. Alex Snyder March 9th, 2009 Frank - great post! I love it on 3 levels: 1. It strikes home with other brands we do carry, so I can relate - MINI, VW, Audi, Porsche 2. CoBalt is the worst site provider, of the big ones, in the automotive arena - I’d rather pay for something else than take their freebie 3. The more of us complaining about these stupid OEM sites, the better! I think we need to have an article that talks about all the OEM sites and where they’re wrong. Something we can refer our OEM’s to when they ask our opinion on things. Jeff Kershner March 9th, 2009 One size fits all. That’s the approach many of the manufacturers take with these mandated dealer website and online marketing ventures. It’s nothing short of a pain in the A$$, especially for the more aggressive dealers that usually have their own thing going on. I’m not for it BUT I can understand why it happens. And I believe it happens for many reasons. In this example with GM, I think Kevin explained it very well in his comment. “Cobalt sites was to bring a lot of GM dealers into the “modern era”, as there were still LOTS of GM dealers that had not grasped the importance of the Internet yet”. There are no doubt MANY dealers that are still trucking 20-15 years behind and STILL do not have an internet presence. 8 of 17 3/12/09 1:37 PM
  9. 9. General Motors (GM) and Cobalt Websites -The Big Rip Off an... How does a large company like GM get their antiquated dealers onboard? They leverage a vendor to do it for them while placing all their dealers in one basket. You bring the lost dealers up to speed while pissing off your aggressive dealers. However, it’s MUCH easier to manage and have a relationship with one vendor rather 3-6. One point of contact, one enterprise report, one company to praise or one company to blame. Unfortunately “one” doesn’t work. You’d think GM would have that figured out by now. As for wasting money on PPC by buying your dealers name. No doubt a huge waste, unless the dealer didn’t have a website to begin with and they were supplementing with PPC until the site was indexed in the SERPS. Of course we all know this is not the case. It would be interesting to know what Cobalt was/is charging GM (I mean the dealers) for these dealer name keyword clicks. The money GM spent on these unnecessary clicks could have been spent on specific dealer internet sales and marketing training for the dealers that needed to get up to speed. Brian in Etown March 9th, 2009 Hmmm….I wonder why G.M. has more then one brand if one size fits all. Frank Davis March 9th, 2009 Thank you for the posts. Understanding GM had to many dealers not paying attention to internet marketing. They did have to do something I agree. Having one website company on board to lower costs, I agree, but to trick everyone into a free website and actually charge for it? Please lets give it up for “free” if you are going to use that term, not charge it to the advertising funds on the invoice. Also when you have aggresive dealers do not redirect them to a website they are not advertising for, do not steal from a dealer doing everything they can to market on the internet. But most of all do not lie to the dealers that are making it work. It was a good idea I believe they just got off track and imposed rules where they didnt need to be. Also they needed onsite training. an experienced trainer should have visited every dealer to evaluate and discuss the marketing on the internet. One size does not fit all as a matter of fact if its to tight you might just kick it off. Frank Jennifer Schrader March 9th, 2009 Frank! Thanks for posting this here. You and I have went back and forth on this subject which now is a very touchy one! Thanks again it is appreciated! 9 of 17 3/12/09 1:37 PM
  10. 10. General Motors (GM) and Cobalt Websites -The Big Rip Off an... Amanda Marsal March 10th, 2009 I can understand why GM started the program in the begining, but by now any dealer that would not be able to adequately handle theirselves with an online presence probably won’t ever be able to. Why not let them weed theirselves out? I have a deep seeded loathing for Cobalt, and want to pull my hair out everytime I have to call ECare for anything. We have so much trouble with our Cobalt sites.. All of the cars were marked with manual transmissions for awhile, we changed the company that sent the feeds for our inventory, and it took two months for everything to show up properly. One hand has no idea what the other one is doing!!! I do miss having an advocate to make changes for me, but I just couldn’t see paying $900 a month for something I can do myself…. Amanda Marsal March 10th, 2009 themselves!! I hate that… Matt Watson March 10th, 2009 I think it is good for the OEMs to mandate certain things on a dealer’s website. But I think this is best done the way Toyota, Honda, Nissan and others do. They review the sites based on certain requirements and the dealership gets in trouble if their site does not comply. They don’t FORCE any particular vendors or special secondary websites. John March 10th, 2009 Just stumbled on this post and thought I’d chime in with some of my own comments. First off, I think its an enormous mistake to punish dealers with ambitious internet programs. Clearly, Cobalt’s solution was to get dealers on the internet. However, if you’re serious about your internet program you realize that Cobalt can only get you so far. And it’s not just GM. Scion has an agreement with Reynolds. Chrysler has a deal with, etc., etc. These companies can’t be everything for everyone. A dealerships internet program requires a great deal of attention that Cobalt,, nor Reynolds can handle. Things will move to the edges a bit more and I think the overall shopping experience will improve for consumers online. 10 of 17 3/12/09 1:37 PM
  11. 11. General Motors (GM) and Cobalt Websites -The Big Rip Off an... Justin Duff March 11th, 2009 Great post. I liken this to going into a Chevy dealer tomorrow and all you can choose from is the Malibu. They stopped making every other vehicle because GM felt that was the best choice for customers. You can complain about it all you want but you’ll still end up driving home in a brand new Malibu. Just hope they made it in multiple colors! John Kimel March 11th, 2009 You can add Volkswagen and Audi to the list of manufacturers who require their dealers to have a Cobalt web site in order to receive leads from the manufacturer. The manufacturers should worry about their own web sites and allow their dealers to be creative with their own. If someone goes to and asks for a quote, that quote should go to the nearest dealer regardless of what web site provider he has chosen to do business with. I suppose that a few years ago when we all started to realize how important a web site would be, it perhaps made some sense for the manufacturer to want to dictate dealer web site content and appearances…after all, the manufacturer had more money and resources to make good decisions on behalf of their dealers. Today, though, I think I can make the case that perhaps most dealers are smarter than GM, Ford, Chrysler etc., all of which are setting new records for poor performance. Maybe the dealers are actually capable of making their own web site decisions now? Frank Davis March 11th, 2009 I want to thank everyone for all the positive responses and support you all are a huge part of the automotive marketing world we all live and play in. I received an e-mail from GM today which wants me to push that much harder, I believe most of you realize the importance of what I have been talking about in regards to the monopoly and the direction we are headed as having rules stuck in front of us and not being able to make the choices we see best for our dealers etc. Here is part of the e-mail I received minus the name of course. Frank, I have ran this issue down through both Cobalt and the Director of the IMR program at GM. The bottom line answer is that IMR program will continue to include the Cobalt website and a basic level of paid search advertising for that site. Modifications to those offerings will not be allowed under the IMR program. I understand this not the answer you were looking. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx. However, I have received very clear direction from Detroit on this matter and do not expect a change. 11 of 17 3/12/09 1:37 PM
  12. 12. General Motors (GM) and Cobalt Websites -The Big Rip Off an... I have done my best to inform and give my best analogy of the situation I see as detrimental not only to our advertising but our actual ability to make choices that effect the way we make a living. Frank Davis 918-520-6777 John Lewis March 12th, 2009 Frankly, all the website companies are the same in certain aspects. I think it really comes down to their conversion ratio or the traffic to the site being converted into leads, either phone calls or emails. We personally have a Cobalt website through GM, and we have the upper package with the search. We have gotten great results in the past 8 months. Our “procare” person is awesome and always helping us with specials and going over our reports and constantly helping us with our online strategy. The search that GM does for their dealers are on 3 tier levels. The first pushes back to GM. The second pushes back to a DMA landing page. The third pushes back to the dealer and is triggered by name and location of the dealer. I think this is a good thing that GM is looking out for us and spending our money digitally. As far as doing additional search with Cobalt, it has more than paid for itself. Unlike other companies I have used in the past, they actually come up with a strategy and have someone running my campaigns rather than just flip a switch and spend my money. We can sit here and bash GM and Cobalt or any other OEM or website provider all day long, but at the end of the day, most of the OEMs are moving towards this and if you ask GM and the dealers out there, it has greatly produced results (even for some of us that have been doing this for a long time). Frank, it seems as though you really have a bug up you about GM and Cobalt. I understand that some dealers want their freedom of choice, but most make the wrong decisions. Coordinating efforts gives us better pricing and more value. I love Cobalt and what they have done for my dealership. Best of luck to all of you. Instead of complaining and complaining, come up with a marketing strategy that works for you, use your procare person (the 299 a month is well worth it), and sell some cars. The squeeky wheel gets the greese, but sometimes it gets replaced. Happy Selling! Frank Davis March 12th, 2009 Hello John Thank you for the post and the information and I have to say it is great to hear that someone is doing well with the cobalt site. If you notice at the begining of my post I said GM and Cobalt had a great idea but with major faults built in. I had a good pro care advocate and was always very helpful. I have come up with a marketing stratagy as you have suggested and Cobalt gets in my way. I am not complaning as you suggest but pointing out the fact that GM and Cobalt has lied to the dealers and continues to direct consumers away from our website that we advertise for, I 12 of 17 3/12/09 1:37 PM
  13. 13. General Motors (GM) and Cobalt Websites -The Big Rip Off an... believe you have not read the article or understand its content and you need to understand that I have a huge amount of respect for not only GM but also for Cobalt as they have a huge amount of experience etc to offer “some” dealers. Other dealers that have been aggresive on the internet have other ” marketing plans” that do not include Cobalt, simply said Gm should not push a website provider on its dealers that have that “marketing plan” in place nor should they place a PPC campaign using a dealers name when they have been asked not to. I want the Cobalt site for one reason and that is to get the link from to a website for Jim Glover Chevrolet. Thanks for the response. It is good to see another point by a dealer that is successful with a marketing plan utilizing a Cobalt website. Frank Davis Leave a Reply Name *Required E-mail *Required, but Not Published Website Comment Contributors Jeff Kershner Founder - Writer LinkedIn 13 of 17 3/12/09 1:37 PM
  14. 14. General Motors (GM) and Cobalt Websites -The Big Rip Off an... Alex Snyder Contributor - Writer LinkedIn Sponsors 14 of 17 3/12/09 1:37 PM
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