June 6th, 2007

Mobile Classifieds – Automotive

Crisp Wireless announced that they are powering a mobile version of Cars.com. As a mobile analyst, I think this is interesting for a lot of reasons. Not many commerce sites have mobile versions.

Cars.com plans to monetize their audience with geo-targeted ads. Yes, lot of companies say they will do this, but Cars.com really can as they ask for zip code information upfront and know which dealers consumers are researching online. There have been a handful of mobile classifieds announcements, but not from major online players in industry verticals.

Here is a take from our lead Automotive analyst, Belis Aksoy.

I understand that Cars.com is the first online auto classifieds site making the listings available to mobile devices, but Edmunds.com is the pioneer in this field with Edmunds2go. Back then (2001) Edmunds was trying to make money by connecting qualified buyers who happened to be on a dealers’ lot and making a purchase decision and searching for pricing information on the Edmunds2go, and Edmunds.com was connecting them to financing and insurance companies. Edmunds was trying to make money through deals with these affiliate partners (through 800 numbers listed on the site). I do not think Edmunds2go is still alive. I am a Cingular user and Edmunds2go is listed under the shopping related Web sites. However, I did not get access to the site.

Cars.com initiative is good, but I think these companies are forgetting that car buying is not a random activity. As you know it takes months for researchers to come to a buying decision. So, as a buyer I will not leave the search process for financing and insurance information until the last minute while negotiating with a dealer. So, I would not be surprised if Edmunds2go did not bring the expected results.

As for Cars.com, I think the model is closer to bringing expected results, especially since it is an ad supported model. But they are going to be facing with another challenge that Edmunds.com has also faced a while ago and that is the demand factor. Only about one percent of online car buyers search vehicle information on cell phones, and this percentage is even lower for used car buyers. Given that many people now have Internet accessible cell phone, Cars.com should make sure to spread the word out well.

I would also be curious to hear if how the experience is going to be on the phone. We are seeing increasing percentage of used car buyers visiting online classifieds sites and one of the factors driving this increase is the availability of detailed vehicle pictures. I wonder to what extent this type of information will be available.

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