Crowdsourcing New Car Pricing

TrueCar - Find Out What Others Really Paid

TrueCar - Find Out What Others Really Paid

Wouldn’t you like to know exactly what others have recently paid for the new car you are thinking of buying?

You no longer have to wonder with the new TrueCar pricing service.  TrueCar is a spin-off from Zag.com and opened for business in April.  Zag.com and TrueCar are founded by Scott Painter, a serial entrepreneur who was also part of CarsDirect and PriceLock.com.  The parent company, Zag.com, provides a white label platform for auto retailing to companies like USAA, American Express, CapitalOne and Overstock.com, and their mission is to make the automotive retailing experience better for both the consumer and dealer.

Ok, TrueCar is not actually crowdsourcing new car pricing in the literal sense.  But they are collecting and analyzing data on individual new car sales from over 30% of all transactions taking place in the US.  In a sense, TrueCar is bringing social media openness and transparency to the process of purchasing a new car by leveraging the power of crowds to transform pricing practices that formerly favored the auto dealers.  The TrueCar pricing service provides consumers with the power of real information to transform the new car buying experience and minimize the stress involved with buying a new car while shortening the purchase cycle for automobile dealers.  Essentially, the no-haggle, upfront pricing is a win-win proposition for consumers and dealers.

TrueCar has a very intuitive and easy-to-use interface.  You start out by selecting a make of auto and inputting your zip code.  Then, you select the specific model, style and options.  TrueCar then provides you with a very good-looking and graphical set of reports showing a curve of what others paid, a bar chart, details of specific prices paid, price history over the last 6 months, vehicle pricing table and cost breakdown.

Being involved with business intelligence and reporting for much of my career, I am very impressed with how TrueCar is serving up their price reports.  Until you have a chance to check it out for yourself, here is an example of the Details report which shows the actual number of purchases in my local area over the last 4 weeks.

TrueCar New Car Pricing Details for 2010 Toyota Prius

TrueCar New Car Pricing Details for 2010 Toyota Prius

So, how reliable is the information from TrueCar?  Here is what they say about the pricing on their website:

The TrueCar Price Reports are backed by data and rigorous statistical analysis. Today, we collect extensive sales data on more than 30% of all new vehicles sold. All data shown on the site is less than 4 weeks old. TrueCar does not manipulate the raw data, nor do we interpret it. TrueCar has no hidden agenda, is not beholden to anyone, and nothing is holding us back from reporting the facts. It is TrueCar’s goal to equally serve consumers and dealers.

And how does TrueCar’s price analysis differ from other pricing services like Kelly Blue Book and Edmunds?  The primary difference is that the other services use opinions of what the price should be instead of actual prices paid recently.

Finally, as CEO Scott Painter said in an article in Wired in April:

We’re transforming the market.  Those dealers not willing to give an upfront price are going to go out of business.

TrueCar is offered both online, and by phone at 1-888-TRUECAR, all free of charge.

Here are some related links to check out.

Back From the Online Community Unconference

Forum One Communications

Forum One Communications

I’m back from Forum One’s Online Community Unconference held at the Computer History Museum in Mountain View, California and I have a great deal of information to digest.  I’ll be summarizing my thoughts in a series of blog posts later this month, but I wanted to start by jotting some notes down now.

This is my second Unconference and I really enjoy the format.  The Unconference is a one-day conference so it is very efficient in terms of the people you meet and the content provided.  The craziness and free form nature of the proceedings is also quite refreshing.  For example, here are the 4 principles followed for this “openspace” conference:

  1. whoever comes are the right people
  2. whatever happens is the only thing that could have
  3. whenever it starts is the right time
  4. whenever it is over it is over

The Unconference also starts off with all 250 participants giving a brief introduction of who they are and the question they are seeking to get answered.  While this takes almost an hour to complete, it is interesting to hear what people are doing and it is a great icebreaker to get a brief introduction so you can follow up with people later in the conference.  The day’s agenda is also set up in a free form, crowdsourced manner with individuals suggesting topics that they would like to lead and when they would like to lead them.  There are 5 timeslots during the day with up to 13 possible topics for each session.  And since you cannot attend all 65 sessions, note takers are assigned for each session and the notes are compiled in the conference wiki.  Bill Johnston and the rest of the Forum One team did a great job moderating the proceedings.

I almost forgot to mention the ‘retro’  Twinkies, Ho Hos and Ding Dongs provided for the afternoon snack.   Fresh cherries, apricots and apples were also part of the afternoon fare for any ‘health-conscious’ or virtuous conference participants.

Many participants were twittering during the day (including me) and you should definitely check out the OCU2009 Twitter feed as there are lots of great nuggets and people to discover.  I had the feed open on my laptop during the day and started following at least 15 new people on Twitter.  The Twitter and Flickr hashtag for the conference is OCU2009 in case you want to follow it on your own.  It was also decided at the close of the conference that the follow-on Twitter hashtag will be #OCTRIBE.  The day ended with the traditional gifting of bottles of Sonoma wine to attendees who made a difference in either a big or little way during the day as determined by the audience.

Finally, here is a picture of the conference agenda provided by Marc Smith:

Forum One Online Community Conference 2009 Agenda

Forum One Online Community Conference 2009 Agenda

Stay tuned for my upcoming OCU2009 posts.

BTW, check out these blog posts on OCU2009 – I am sure there will be more:

Jeremiah Owyang – Thumbs Up or Thumbs Down

Crowdsourcing Jeremiah Owyang’s Fate

Jeremiah Owyang - Yah or Nay

Jeremiah Owyang - Yah or Nay

Forrester analyst Jeremiah Owyang wrote a blog post yesterday about some rumors at Mzinga that ended with a strong recommendation for any prospects to stall any movement until he is briefed by Mzinga next Monday.

Here are a few excerpts from the original post:

I’ve been hearing from multiple sources in a variety of folks that Mzinga is undergoing some changes. With the recent layoffs a few months ago, to apparently voluntary leave of the CMO this week, there are a lot of questions I have to ask.

I strongly recommend that any Mzinga clients or prospects stall any additional movement till they brief me next Monday.

First, I believe that such statements in a blog are incredibly unprofessional and border on negligent corporate behavior – especially when the post was written based on unsubstantiated rumors.  Second, the call to “stall any movement” until Jeremiah gets briefed next week is pretentious in that only Jeremiah can get to the bottom of this issue’?

Jeremiah is a respected analyst working for a respected firm, and has worked hard at covering and growing the social media and community space.  Jeremiah did issue an apology on his blog today and I heard that Forrester also sent Mzinga an apology as well.  Plus, there have been more than 60 responses to his original blog post and nearly 30 to his apology post today.  I’m sure that Jeremiah feels contrite in the same way that Alex Rodriguez, Bernard Madoff and Bill Clinton have felt in the past when they issued their own public apologies.  But that doesn’t undo any damages that Mzinga has incurred from negative mentions in the posts and on Twitter.

Because Jeremiah is such a proponent of social media, I think we turn his predicament over to the general public and use crowdsourcing to determine his fate.

Take a moment to express your opinion below in this quick poll:

Several other bloggers have piled on to this issue including:

I’m sure there will be more.

My disclosure – I have worked with Mzinga since December 2006 on two different community efforts and I believe that Forrester should fire his a** for this flagrant offense in order to protect their own brand and image.

Tips For Running a B2B User-Generated Commercial Contest

More and more companies are turning to their customers and others to help with their marketing messages.  One of the more recently popular vehicles is to hold a contest for the best commercial.  Doritos has successfully held a contest for the past several Super Bowls.  Other consumer-based (B2C) examples include contests from Heinz Ketchup, Dibbs ice cream, Klondike bars and Brighter Planet.

Using customers and others to help with marketing efforts is an example of crowdsourcing.  Crowdsourcing is a term first coined by Jeff Howe in 2006 in a Wired magazine article.  The Wikipedia link for crowdsourcing lists many examples of how organizations are using this new technique for their benefit.

However, not many companies have tried commercial contests in the B2B space. In my former job, one of my projects was to develop and manage a B2B user-generated commercial contest for a software company and I wanted to share some of the tips and tricks I learned along the way.

My Contest Background – The contest I ran was for a company called iRise where I was Senior Manager of Strategic Projects.   iRise is an LA-based software company that sells a rapid prototyping/visualization solution for companies who want to accelerate their software development process.  In March 2008, Mitch Bishop, the CMO, came up with the idea of hosting a video contest to stoke the creativity of our user base and drive awareness and demand for our product, and I was assigned to develop and manage the project.  The only guidelines that I was given were that the prize total should be $20,000 and that the contest should be over by the end of the second quarter.  So, I had 3 weeks to research and develop the project before launching in early April.

The bottom line is that running a commercial contest involves many different skill sets including “sales”, social media marketing, guerilla and viral marketing, writing, business development, technical web development, market research, marketing analysis and project management.  These skills could be wrapped up in one person or spread across a team.  In my case, I performed all of the skills except for the technical website development.

Developing the Rules - I started out by research user-generated contests and checked out many different options.  There are companies that will actually host contests for you (like Votigo, memelabs and online video contests ), but I didn’t want to lose control and didn’t have the budget to do.  I ultimately patterned most of our contest process and rules after the Heinz commercial contest mentioned above.

Our contest was based on two phases.  In the first phase, people would upload their 30-60 second video to YouTube, register for an account on the video contest website and then submit the YouTube URL to us.  An internal committee would then review the submitted entries and select 10 semi-finalist videos for phase 2.  The criteria for selecting the semi-finalists would be based on:

  • #1) Originality (40%)
  • (#2) Overall appeal (30%)
  • (#3) Likelihood to motivate people to buy or try iRise (30%)

In the second phase which lasted 2 weeks, public voting would determine the final winners.  People were allowed to vote for one video during each 24-hour period and the video with the most votes would win the overall prize.

Creating the Website – The key with setting up the website is to have a very talented web jockey and your own URL.  For the iRise contest, we set up a URL for the “Visualize the Prize” contest at http://irisevideo.com/ and I was very fortunate to have the iRise Webmaster Ray Walker as a resource.  Ray likes to experiment and he came up with some very clever ways to run the site and voting using off-the-shelf open source tools.  While Ray could set up the website infrastructure, there was still a lot of content to develop for the site.  Ray even wrote a Facebook application to display the final 15 video entries from within Facebook.

iRise Visualize the Prize Contest

iRise Visualize the Prize Contest

Getting the Word Out – I spent the better part of the first week promoting the contest in as many outlets as possible.  I joined a number of Yahoo Groups, Facebook Film and Video groups, and other online forums and groups so I could post messages in different forums.  I didn’t keep count, but I probably posted in at least 100 forums or groups and re-visited some of the sites to post reminders.  I also bought ads on Facebook targeted at people with film and video interests and set up ads on Google.  I tried contacting the top film schools to announce the contest to starving film students, but didn’t have much success with that path.  Since I wasn’t sure which of my guerilla marketing efforts would pay off, it seemed like I was just praying and spraying – but in the end, it all worked out for us.

In addition to the guerilla marketing, we issued a press release on the contest and I wrote a couple of blog entries on the iRise corporate blog and for the Catalyze community.  I posted a link to the post on Twitter and several of my Twitter contacts spread the links and wrote their own blog posts.  I was also frequently blogging on the video contest site in order to keep the content fresh.

Waiting for Entries - The most frustrating part was waiting for entries to get submitted.  The contest was launched on April 10th with a submission deadline of June 4th.  I knew we wouldn’t get any entries for the first couple of weeks, so all I could do was to track traffic on the contest website and post blog entries discussing the contest.  I also created and uploaded 2 videos of my own to “prime the pump”.  We were averaging 50-75 visits per day, so I knew we were getting some attention.  Our first contest entry came in with 4 weeks left in the contest and with 3 weeks left, we had just 3 rather mediocre entries.  The big flood of entries started arriving with 5 days before the end of the contest and we ended up with 44 total entries.  I liken the final influx of entries to an eBay auction – all of the action is going to come in the last few days, so just stay calm and let the process take care of itself.

Judging and Selecting the Winners – Our contest rules were set up that an internal committee from iRise would select the top 10 videos from all of the entries and then let public voting decide the overall winners.  We set up the voting so people could only vote once per day.  We ultimately selected 15 videos for the last phase of the contest.

The Results – Overall, the contest was a brand awareness success and the jury is still out on whether iRise will be able to attribute any revenue to the contest.  During the contest, we had over 16,000 visitors to the contest website who looked at 57,000 pages and the videos received more than 30,000 views on YouTube.  Most of the submitted videos were not from iRise customers or partners, but we did have a handful of videos submitted from ‘friends of iRise’.  The majority of the entries were submitted by people who first had to figure out the iRise product and message, and come up with an idea for a 30-second spot.

The contest also generated a bunch of residual content on the contest website and on YouTube.  Longer term, success should be measured by actual sales which could take several quarters or more to play out.  It also remains to be seen how iRise can leverage the video content in the future.

And here is the winning video:

Keys to Success – I believe that there were 3 keys to our success.

Obviously, the first key was that we set the contest prizes at a high enough level to garner interest.  The first prize of $15,000 was enticing enough to induce some people with professional expertise to submit entries.  In fact, we had trouble selecting the top 10 videos for the final voting and decided to expand the final voting to 15 entries.  I think we may have overpaid in that we probably could have gotten away with prizes of $6,000, $3,000 and $1,000 – and would have gotten the same number of quality entries.  Besides the top 3 prizes, we also passed out $100 Amazon gift certificates to the 12 entries that didn’t take home any of the cash rewards which hopefully took some of the sting out of not winning.

The second key was to have a great website that allowed us to showcase each of the video submissions and to capture the final voting.

Thirdly, our guerilla marketing efforts got the word out to enough people who were interested in submitting their work.

Overall, I had a great time and learned a lot about running video contests.  Feel free to drop me a line if you have any other questions or add a comment below with your own experiences.