We create branded digital assistants that automate live chat with consistent, accurate and data-powered conversations. We have exchanged more than 11 million messages with car shoppers and owners. The following analysis shows how driving users to high-value shopping tools with greater success turns into sales. Capturing conversations in a systematic way also delivers incredibly insightful “Voice of the Customer” analytics.
We start with the industry website KPI usage and value of each as baseline data - calculated by JD Power
JD power linked online consumer activity with actual offline automotive sales data collected by the Power Information Network® (PIN).
- 4% of shoppers who configure a vehicle turn into a brand sale
- 7% of shoppers who request a quote turn into a brand sale
- 10% of shoppers who download a brochure turn into a brand sale
- 3.4% of shoppers who find a dealer turn into a brand sale
- 3.4% of shoppers who estimate payments turn into a brand sale
- 6% of shoppers who search for inventory turn into a brand sale
Assuming average profit margins on a new vehicle: $3,000
(Profit margins range from a few hundred dollars for bargain-priced sedans, to nearly $10,000 on some Pickup models. We use $3,000 as our value in this ROI calculation).
As an example, that means that to equal 1 sale you need 10 Brochure KPIs or 14 Quote KPIs or 25 BYO KPIs an so on.
We tracked six specific high-value shopping actions and detailed how users converted to them, scaled against J.D. Power’s O2O1 report to determine their dollar value.
Based on the above, every incremental KPI would generate²:
- $125 per Build Your Own
- $214 per Request A Quote
- $300 per Brochure Download
- $185 per Search Inventory
- $105 per Find A Dealer
- $105 per Estimate Payments
JD Power rate of KPI usage on websites:
Of the 6 selected KPIs, historical web usage data1 suggests the following numbers to be performed by 1,000,000 users each month:
- Build Your Own @ 15.5% = 155,000
- Request A Quote @ 3.0% = 30,000
- Download Brochure @ 1.1% = 11,000
- Search Inventory @ 9.0% = 90,000
- Estimate Payments / Find A Dealer @ 4.5% = 45,000 (each)
CarLabs’ clients experience an 80% lift in these 6 KPIs over traditional website navigators
(Assuming only 1% of web visitors use the digital assistant as a conservative benchmark.)80% lift Lift x value
- Build Your Own = 1240 ROI = $155,000 (1240 x $125)
- Request A Quote = 240 ROI = $51,360 (240 x $214)
- Download Brochure = 88 ROI = $26,400 (88 x $300)
- Search Inventory = 720 ROI = $133,200 (720 x $185)
- Estimate Payments = 360 ROI = $37,800 (360 x $105)
- Find A Dealer = 360 ROI = $37,800 (360 x $105)
Deduplicating Shoppers Who Perform More Than 1 KPI:1 Of the six KPIs listed above, the ROI numbers would be accurate if every one of the shoppers performing a KPI did only a single KPI. Intuitively, we know that many, but not all, shoppers who perform KPIs do multiple actions. Using the J.D. Power O2O data2 as a baseline, we’re assuming an average of 2.41 KPIs per user.
Adding up the total KPIs above gives a total of 3,008. Dividing this number by 2.41 gives us a unique count of 1,248. Since we can’t predict exactly which KPIs will be performed by multiple-action shoppers, we also average and divide the entire ROI by 2.41.
Given all of these assumptions,** total ROI in year 1 would be $183,219 per month.
The ROI would increase as the tool improves and we optimize the experience to convert at higher rates.
Benefits Beyond Conversion and Lead Gen.
CarLabs’ current tier 1 automotive clients realize many benefits, including:
- Improved ROI on digital advertising using CarLabs engagement tools
- Reduced Facebook monitoring and live chat costs
- Improved overall customer experience
- Better customer insights to optimize marketing and customer service.
Carlabs ROI Calculator
Calculate your ROI based on different assumptions**
- An auto brand’s Tier 1 new car shopping website receives 2,000,000 unique visitors per month (adjust the ROI at the bottom based on how this number differs for your website)
- Half of the website visitors, an additional 1,000,000, are current Owners, looking for help with service scheduling, parts, payment or finance questions, or help on using features of their vehicle.
- Conservatively, 1% of shoppers will use the AI agent to assist w/ new vehicle shopping
- KPIs performed by website visitors who use the AI agent will rise 80%
- KPI Value: taken from historical website data outlined above1
- Profit Margin: An average of $3,000 is utilized in this calculation2
- KPI usage current rate: taken from historical website data outlined above1
¹ J.D. Power’s O2O data matched online website ex
Exposure to offline vehicle sales for more than 20 Tier 1 automotive manufacturer sites. The numbers are historical averages from the 2016-2018 time period, and individual website may vary by one or two standard deviations, in any given month
² Profit margin calculations are derived from J.D. Power’s PIN network, which captures 45% of the daily transactions for new vehicle sales across the U.S.