27 June 2016

In the past couple of years, Auto Trader has been working hard to improve its relations with auto retailers. They went through a rocky patch after a group of retailers got together to complain about its pricing structure and its market dominance.

While there have been a few hiccups along the way, moving away from commission based sales staff and operating in a more transparent way has, mostly, helped.

Now, with the announcement that it plans to bring in a ‘great value’ badging system for cars, is it risking this improved relationship?

Auto Trader, rightly, believes that openness and transparency improve trust and consumer confidence. Consumers want to do things such as compare prices on a level playing field, get a fair value for their trade-in and know they’re getting a good deal on the car they’re buying.

If retailers don’t open up to consumers, then this paves the way for third parties to disrupt the market with clever products and services. But should it be the retailer or the advertising medium that decides a car is ‘great value’ for the consumer?

And, while the idea behind the new ‘great value’ badge may be a good one, and not a million miles from any retailer in any sector promoting the best offer they have, if it’s anything other than accurate it could cause more harm than good.

Auto Trader admits it doesn’t have all of the optional equipment information it needs yet to give perfect valuations, which could be this system’s downfall. After all, if Auto Trader is, as it claims, using average optional equipment levels for each model, then you could easily end up with a situation where a poorly equipped car is priced low and badged ‘great value’ when clearly it’s not. At this point trust could be lost.

It’s a fine line that Auto Trader must tread. After all, the company has two sets of customers who must maintain trust – there’s you, the auto retailer and the car buyers who must come back time and time again to look for their next car.

Get it right though and it could lift overall confidence in the auto retail sector.

Tristan Young

Auto Retail Network

Editorial director

Tags: auto retailer, Auto Trader, rating system, value for money