When Industry Veterans Innovate

I’ve been following Carliquidators for a few months now when I accidentally stumbled on to the site, really stumbled, as I have no idea how I found it. Carliquidators is selling used Crossfires directly to the public from rental fleets. This another one of those Carless Car Dealers but offers a slightly different business model as they are, at least right now, specializing only in rental fleets and only selling crossfires – correction, it looks like you can now buy anything. There certainly seems to be an undercurrent in the industry right now to change the buying process, standardize the flow, reduce prices and improve customer experience.

One of predominant fears I have with this blog is becoming the guy who finds fault with everything, so I recognize that this is an early stage of development for Carliquidators, certainly for the niche of the used car industry that may be “Used Cars Direct”. Getting the right product offering and promotion is likely to take time, money, and a good idea or two. Probably because Driveitaway, the company that started Carliquidators, has a blog I’m partial to the company. I also like them because they are taking the time to invest in their site as even over the past couple of weeks I’ve seen some really positive changes in their site.

One of the dominating issues with this direct-car concept is how comfortable the consumer will feel buying the car site-unseen. Most consumers are definitely not ready to take that step. In addition to letting consumers test-drive a car before buying, dealers serve another valuable function: helping with financing and accepting trade-ins, there is a monthly payment calculator but I’m not sure if this connects up with a financing company.

The biggest issue I see Carliquidators having is that (I think) most of the experience of the management team has been focused on B2B. Certainly they know the auto industry, but Carliquidators is more of an Internet company than an auto company. This lack of consumer experience shows up in some of the basic navigation and site development. For example, the nav bar links completely change depending upon the part of the site one is on. They have links to ‘wish list’ and ‘transport’, but they take almost random clicking to find. And if he hasn’t yet, I’m sure Ryan from Blogproautomotive.com will try to contact the owners to offer help with some major SEO needs.

Another concern is how much Driveitaway will focus on this part of the market. Certainly, if they could provide a liquid venue for rental companies to sell their cars to the public, Driveitaway could create a disruptive innovation in remarketing and steal some major business from Manheim. At this stage of the market, Manheim is unlikely to view Carliquidators as a threat, and if Carliquidators moves fast and quietly, in a few years, it could really turn the industry on its head. But, this needs to be balanced with the other needs of the business internally and serving the business community will require different resources than meeting consumer demand. This seems like a case out of Clayton Christensen’s The Innovator’s Dilemma, and likely shares some parallels with Manheim’s OVE experience.

I’m looking forward to seeing how things shake out in the coming years in this market segment. As a side note, Evenlevel updated its homepage design and has a new logo…

One response to “When Industry Veterans Innovate

  1. Ralph Paglia over at ADP pointed me to CarLiquidators a few days ago as having an interesting technology.

    Theirs is an interesting angle and may circumvent some of the issues the ecommerce 1.0 companies experienced before the DotCom crash (in the states where this isn’t illegal due to brokering / curb stoning laws).

    Ralph pointed me to them since my company has a shopping cart based ecommerce system for a car dealer to add to their website. A software application to give a dealer a click and mortar capability (vs. the prevalent lead model).

    Here’s to ecommerce 2.0 in the auto industry!

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