Autobytel

THE CHALLENGE:

With the acquisition of Car.com, Autobytel faced the urgent need to significantly enhance the sophistication of its lead routing engine. Initially, when operating as a single site with a single dealer network, lead routing was relatively straightforward. However, as the company evolved, the number of affiliates grew and several competitors were acquired, the complexity of lead management increased dramatically. Autobytel found itself managing leads across multiple dealer groups, often dealing with multiple contracts with the same dealer spread across different sites, each with varying terms and territories.

The volume of leads had surged to more than 300,000 per month, putting immense pressure on the existing system, which was increasingly showing signs of obsolescence. The legacy system’s limitations became evident with each new acquisition, as it required cloning tables and running multiple instances of the same application. Additionally, Autobytel was selling leads on the wholesale market directly to original equipment manufacturers (OEMs), adding another layer of complexity. Clearly, a more efficient and scalable solution was necessary.

THE SOLUTION:

To address this multifaceted challenge, we began with the core concept that a single instance of our lead routing engine—now redesigned and dubbed a yield management system—would be capable of handling the entire workload. This system needed to be sophisticated enough to understand and manage the contract variances for dealerships across different territories, companies, and affiliates.

Our team meticulously crafted a system capable of analyzing an individual dealer’s run-rate. If a dealer was on track or exceeding their monthly targets, the system would then attempt to route the lead to another dealer, or perhaps even the same dealer but under a different contract. In cases where these options were exhausted, the system would then assess the potential for selling the lead on the wholesale market. Affiliate leads would be rejected at this point, while internally generated leads were always accepted.

The new yield management system integrated advanced algorithms and real-time data analytics to make these routing decisions dynamically. This ensured optimal lead distribution, minimized conflicts, and maximized the utilization of available leads across the network.

THE RESULT:

The implementation of the yield management system revealed a significant inefficiency: approximately 20% of the leads purchased were being discarded due to non-coverage or under-coverage for specific vehicles in particular territories. By addressing this issue, Autobytel realized an immediate annual bottom-line profit increase of $6 million. Beyond this initial financial benefit, the new system also enhanced overall profitability by optimizing the mix of leads and capturing valuable demand data.

This data was instrumental in developing a robust sales estimating tool, which further improved the company’s ability to forecast and respond to market demand. The yield management system not only streamlined lead routing but also provided strategic insights that contributed to more informed decision-making and long-term growth. Ultimately, this initiative positioned Autobytel as a more agile, efficient, and data-driven organization, better equipped to navigate the complexities of the automotive lead generation industry.