DEALIXAutomobile Shopping Behavior 2007

Research Insights for Dealix Customers

DEALIX

Highlights of 5 Major Industry Studies in 2007

> 2007 New and Used Autoshopper Studies

> 1 million leads from 1,140 dealerships representing 35 brands matched with DMV data to assess sales rates and tim e to close

> Two consumer surveys:

- 550 vehicle shoppers and purchasers

- 1000 vehicle purchasers||

> 2100 dealerships in eMystery shop campaigns [20 bran ds]

> 20 onsite visits to top performing dealers

DEALIX

Key Insights for Your Dealership

> All customers are “internet customers”

> 3rd party leads are essential to reach 20-25% of shoppe rs

> Many shoppers have a different timeline than your s ales team

> You only have one shot to win over a shopper

> Excellent lead management practices increase close rates 2-3X

DEALIX

Consumer Shopping Process

1. Should I be in market?

- Resale value/condition of current vehicle

- Change in vehicle needs

- “Gotta have” new model

2. Which models meet my needs?

- Price, styling, reliability, size

- Previous experience

- Advice from friends

3. Where should I purchase?

- Price

- Convenient location

- Service

DEALIX

Metrics Through the Funnel

Consideration

Purchase

Awareness

Familiarity

Visit Dealer

→ Change in awareness

→ Improvement in familiarity

→ Improvement of opinion

→ Click on ad

→ Click to site

→ Build a vehicle

→ Search inventory

→ Search for dealer info

→ Request a quote

Measures of Success

DEALIX

All customers are Internet customers

Base: Total Respondents (550)Q4 When researching auto dealerships, which of these online search engines did you use to obtain information? (Please select a ll that apply.)QS10Which of the following resources ‘did you use t o gather information while shopping for your new vehicle?’ OR ‘are you using to gather information while shopping for your new vehicle?’Q0You mentioned that you used the resources shown b elow to research and shop for new vehicles. How did you reach each of t hese websites?

Car shoppers are qualifying dealers by researching online & using search for vehicle dealership research

Yahoo! Search Marketing Proprietary and Confidentia l. © 2007. All Rights Reserved.

DEALIXPercent of New-Vehicle Buyers

Submitting a Request for Online Dealer Referral

20% 21% 21% 22%

0%

10%

20%

30%

40%

50%

60%

2004 2005 2006 2007

Based to new-vehicle buyersSource: J.D. Power and Associates 2004-2007 New Aut oshopper.com Studies

Requests for online quotes are steady%

of A

ll B

uyer

s

Visited DealerFound Online

39%

DEALIXMethod that Led to Used Vehicle Purchased

14%11% 10%

5% 5%

11% 12%16%

23%

9%

0%

5%

10%

15%

20%

25%

30%

Newspaper Classifieds Classified Ad Magazines Online Classifieds

Based to late model used-vehicle buyersSource: J.D. Power and Associates 2003-2007 Used Au toshopper.com Studies

23% of used vehicles sold are sourced online

2003 2004 2005 2006 2007^

% o

f All

Buy

ers

DEALIX

Key Insights for Your Dealership

> All customers are “internet customers”

> 3rd party leads are essential to reach 20-25% of shoppe rs

> Many shoppers have a different timeline than your s ales team

> You only have one shot to win over a shopper

> Excellent lead management practices increase close rates 2-3X

DEALIXPurchase Milestones of New-Vehicle AIU's

012345678910111213141516

Weeks Before Purchase (Mean)

Decide on typeof vehicle

Start visitingdealers

The new-vehicle shopping process takes about 3 months for the average shopper

Decide it was time to purchase

Shop vehicleson the Internet

Start activelyresearching vehicles

Decide onmodel

Purchasenew vehicle

14.7

11.7

11.0

10.4

7.6

6.3

0

Source: 2007 J.D. Power and Associates New Autoshopper.com Study. Based to AIUs.

DEALIX

One-third of new-vehicle buyers purchase within 1 month of deciding they need a new vehicle

Shopping Timeline of AIU's

8%

15%

10%

2%

18%

22%

13%13%

0%

5%

10%

15%

20%

25%

53 ormore

25 to 52 21 to 24 9 to 20 5 to 8 4 3 to 2 1 week

Weeks Before Purchase

Decide time to buy

34% Shopping Process One Month or less

27% Shopping Process Over Six Months

Source: 2007 J.D. Power and Associates New Autoshopper.com Study. Based to AIUs.

DEALIXPurchase Milestones of Used-Vehicle AIU's

012345678910111213141516

Weeks Before Purchase (Mean)

Decide on typeof vehicle

Start visitingdealers

The process is not much different for late-model used vehicle buyers

Decide it was time to purchase

Shop vehicleson the Internet

Start activelyresearching vehicles

Decide onmodel

Purchasenew vehicle

14.9

13.8

10.9

9.9

10.1

6.9

0

Source: 2007 J.D. Power and Associates Used Autoshopper.com Study. Based to AIUs. Preliminary Data

DEALIX

Over one-third of new-vehicle buyers seriously consider only one model

Number of Vehicles Considered

34%30%

20%16%

0%

5%

10%

15%

20%

25%

30%

35%

40%

One Two Three Four or More

Loyal

DEALIX

Consumers consider multiple brands

Consumers visit an average of 6

dealerships , but they visit only one dealership per

brand

Base: Total Respondents (550); Those RespondingQS6 Please select the statement that best describes your consideration of each make listed below. QS7 How many dealerships did you visit for each mak e?

Yahoo! Search Marketing Proprietary and Confidentia l. © 2007. All Rights Reserved.

DEALIX

Geographic area of consideration grows

68% of consumers are not willing to travel more than

20 miles

32% of consumers are willing to travel farther than

20 miles

A third of consumers will drive more

than 20 milesfrom home

Base: Total Respondents (546)** Don’t know responses removedQS8 Again thinking about the dealerships you visited , think about how far each

dealership was from your home. In miles, please tel l us the distance between your home and the farthest dealership you v isited for each make.

Yahoo! Search Marketing Proprietary and Confidentia l. © 2007. All Rights Reserved.

DEALIX

Key Insights for Your Dealership

> All customers are “internet customers”

> 3rd party leads are essential to reach 20-25% of shoppe rs

> Many shoppers have a different timeline than your s ales team

> You only have one shot to win over a shopper

> Excellent lead management practices increase close rates 2-3X

DEALIX

Overall conversion is steady

45% of leads did not convert

55% of leads converted

Based on registration information supplied by R. L. Polk & Co.Sales/leases have been adjusted for matching effici ency by a factor of 1.36, which represents a 73% historical match rate

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

One Million New Car Leads

DEALIX

Lost opportunity is still high

90% closed at a dealer other than the one the lead was sent to – “lost opportunity”

Based on registration information supplied by R. L. Polk & Co.Sales/leases have been adjusted for matching effici ency by a factor of 1.36, which represents a 73% historical match rate

Sold at “intended”dealership

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

DEALIX

All “missed” sales

Based on registration information supplied by R. L. Polk & Co.Sales/leases have been adjusted for matching effici ency by a factor of 1.36, which represents a 73% historical match rate

Sold at “intended”dealership

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

DEALIX

Too many leads go unanswered

2007

Overall responsiveness 68.6%

Response time average (hrs) 7.1

Quality of responses:

Answered the shoppers questions 28.6%

Use brand or product highlight 25.5%

More than 30% of leads going unanswered.

2007 Cobalt National eMystery Shop, Base: 2,111

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

DEALIX

Lead response time is slow

2007

Overall responsiveness 68.6%

Response time average (hrs) 5.4

Quality of responses:

Answered the shoppers questions 28.6%

Use brand or product highlight 25.5%

20% of consumers want a response within 4 hours or they’ll go someplace else.*

2007 Cobalt National eMystery Shop, Base: 2,111* “Cars Online 06/07: Understanding the Dynamics of Consumer BuyingBehavior and Customer Loyalty” CapGamini

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

DEALIX

Poor lead handling contributes to brand defection

QV5 - Those who said they purchased a different make /brand than submitted an inquiry about (301) Which of the following reasons describe why you purchased another make/brand than you submitted an online inq uiry about?

Of those that switched brands, 23% did so because of poor dealer interaction

Why did you purchase a different brand than you sub mitted an onlineinquiry about?

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

Poor or no response

Bad dealer experience

DEALIX

Quality of lead response is poor

2007

Overall responsiveness 68.6%

Response time average (hrs) 5.4

Quality of responses:

Answered the shoppers questions 25.0%

Use brand or product highlight 25.5%

2007 Cobalt National eMystery Shop, Base: 2,111

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

DEALIX

eMystery National Shop 2005 vs. 2007

2005 2007

Overall responsiveness 69.7% 68.6%

Response time average (hrs) 6.5 5.4

Quality of responses:

Answered the shoppers questions 25.9% 25.0%

Used brand or product highlights 30.4% 19.5%

2007 Cobalt National eMystery Shop, Base: 2,1112005 Cobalt National eMystery shop, Base: 3,576

The Cobalt Group, Inc. Proprietary and Confidential . © 2007. All Rights Reserved.

DEALIX0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

0-30 days 31-60 days 61-90 days 91+ days

High Performering Dealers Low to Avg Performing Dealers

The Impact of Dealer Lead ExecutionCumulative Close Rates vs. Lead-to-Close Time

2X

3X

DEALIX

Key Insights for Your Dealership

> All customers are “internet customers”

> 3rd party leads are essential to reach 20-25% of shoppe rs

> Many shoppers have a different timeline than your s ales team

> You only have one shot to win over a shopper

> Excellent lead management practices increase close rates 2-3X