Auto Dealers Fume Over 'Insulting' Edmunds.com Ads

Online Car-Shopping Site Has no Plans to Pull Spots

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UPDATE (4:30 p.m.): Edmunds.com has pulled the ads.

New YouTube ads from Edmunds.com, which suggest that car dealers are unethical hagglers, have provoked a backlash.

Kevin Frye, e-commerce director for The Jeff Wyler Automotive Family in Cincinnati, said the four videos perpetuate stereotypes of dealers as bargainers trying to take advantage of shoppers with outrageous markups.

Mr. Frye said Tuesday that he will cancel the Wyler dealership group's Edmunds.com subscriptions. Dealers pay Edmunds to post their inventory online.

Edmunds says the ads are simply spoofs intended to show that customers dislike haggling.

Actually, dealers don't appear in the videos, which were posted on Tuesday, Oct. 21. The spots show a grocery store clerk trying to negotiate prices of milk and other items.

Michelle Denogean, chief marketing officer for the third-party vehicle shopping site, said the videos portray a buying experience so far from the way modern dealerships operate that company executives are surprised that some dealerships are offended.

Ms. Denogean said the videos are intended to illustrate in an exaggerated, lighthearted way that shoppers don't like to haggle on prices. Shoppers want a fair and transparent buying experience that Edmunds can help facilitate, she added.

"The stereotypes are very outdated," she said.

"Insulting"
But the videos offend Jeff Wyler, CEO of the Wyler group.

"For 41 years, the Jeff Wyler Automotive Family has been committed to practicing business at the highest levels of integrity," he said. "Negotiating prices on cars has always been expected by the consumer and having it referred to as 'haggling' by a company that I am a customer of is insulting."

The 15-store group, Mr. Frye said, was putting its 2015 ad budget together when the videos hit YouTube.

The four ads combined generated more than 59,000 views and 31 comments on YouTube as of Wednesday afternoon.

One dealership manager said the ads are another reason why stores should build their own brands and websites instead of trying to pay for leads. He declined to be named.

Another dealership group, Colonial Automotive Group in Acton, Mass., found the videos offensive, but not enough so to cancel the Edmunds.com subscriptions it has at eight of the group's 14 stores, said Daniel Fontaine, group e-commerce director.

"It's disheartening to have a vendor like that telling you that they want to be your strategic partner, then doing this," Mr. Fontaine said.

Haggling over squash
Edmunds.com's new videos are titled "Haggling is absurd!"

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In them, a grocery checkout clerk tries to gouge shoppers on items such as bread and squash and haggle with them when they refuse to pay the asking price. Edmunds.com says in the videos that the scenes were taped with four hidden cameras.

The clerk uses a couple of old sales ploys, such as calling the manager on a price and telling the shoppers that the price is high because the products are flying off the shelf. He starts at $9 for a quart of milk with one male shopper.

The scenes end with the punch line: "You wouldn't haggle for your groceries, so why do it when buying a car?"

Edmunds.com has been marketing a no-haggle approach to shopping on its site for more than a year through a program called Price Promise.

Through it, an Edmunds shopper can get a guaranteed price from an Edmunds-participating dealer on a specific new vehicle. The service also provides prices of similar vehicles in the area.

Edmunds believes so strongly in the no-haggle approach that it wants all of its 10,000 participating dealers to offer Price Promise over the coming months. About 8,000 already are onboard with the program, which was rolled out in spring 2013.

Favorable feedback
Edmunds has no plans to remove the spots from YouTube. Ms. Denogean said the company is getting favorable feedback from consumers and some dealers. The creative work was done by Publicis Kaplan Thaler in New York City.

When the videos were launched, Edmunds also rolled out a program asking customers to salute great sales and service at the dealerships they patronized, Ms. Denogean said.

Feedback will be posted on Edmunds.com and social-media sites, with dealership sales and service representatives given an opportunity to win a $100 gift card from Edmunds.

Mr. Fontaine of Colonial Automotive Group said dealerships are tired of vendors trying to portray themselves as protectors of consumers against unscrupulous dealers.

Mr. Fontaine said Edmunds' marketers "need to watch out how they are positioning themselves."

Five years ago, Edmunds made a video highlighting its own look into dealership practices. In its "Confessions of a Car Salesman" project, Edmunds hired an investigative reporter for three months to work as a new car salesman and expose "what goes on in a dealership."

--David Barkholz is a reporter for Automotive News