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CarsDirect CTO Debra Domeyer on CRM

Debra Domeyer’s career began with technology support for now former Senator Bob Dole and with supervising application development and secure communications for President Ronald Reagan’s trips worldwide.

After some time in vice presidential information technology stints in mortgage, publishing and energy services, Domeyer five years ago began work at CarsDirect.

Domeyer calls the company the “concierge for cars,” because of the way the company’s Web site facilitates consumer vehicle purchasing.

The company offers consumers a choice of three car-buying options: buying a new car online through its “direct channel” for an upfront, guaranteed price, matching themselves with their choice of new car dealer and using its “connect channel” to negotiate the best price, or locating and purchasing a used vehicle via its “used channel.” Consumers also may list their existing vehicle for sale on the CarsDirect Web site. CarsDirect also provides dealers and manufacturers with information regarding how consumers are buying vehicles.

During this interview with CRM Buyer, Domeyer explained how CarsDirect’s CRM is at the heart of its business and supports its customers — consumers, dealers and manufacturers — as well as provides revenue streams for the company.

CRM Buyer: What are the key CRM challenges facing your business?

Domeyer: One of our challenges is keeping up with the constant speed of change of the enormous amount of automotive data that we manage. CarsDirect has 120,000 different vehicle configurations all up on our Web site at the same time. The data that we provide on all vehicles, their pricing, configuration and incentives for vehicles changes constantly. We make some or all of these changes on a daily basis — 7 days a week. For example, when General Motors has a new incentive, we have to go through and mark all of GM’s vehicles — almost in real time — as soon as we hear about the pricing and incentive changes.

The industry is constantly going through growth and the manufacturers have been excellent at playing with incentives should there be a slowup in their vehicle purchasing. There’s more car buying and research going online — about 65 percent of the population researches online before deciding to purchase a vehicle now. When consumers go onto a dealership lot, there are a number of variables, depending on the dealership, that lead to a sale. But when they go to our Web site, it’s strictly what the consumer wants to look at and is interested in. All that data is tracked in our CRM system.

The overall development speed is another challenge. As a company, we are constantly adding new products that create revenue lines. I’m not referring to anything like a Web site change. Two examples of type of products that I mean are new products like our used cars channel and our research site both added a few years ago. As we speak, we’re working on five or six of these, and we are involved in the defining of the product all the way through their implementation.

A third challenge is how to make the enormous volume of information useful and understandable to the consumer. We have a detailed Web site and in-depth vehicle configurator that lets consumers find out anything they want about a vehicle. And we are constantly working to make these simple for the consumer to use.

CRM Buyer: What sorts of things do you have to track regarding a car sale?

Domeyer: Buying a vehicle in general requires quite a bit of paper work as well as a number of detailed steps, and so we try to make that process as simple as possible. CarsDirect has 120,000 different vehicle configurations on its Web site to help consumers locate the new or used vehicles they want, assist them with financing and set up the appointment with the dealership.

All of the consumer lead data is housed within Siebel. When the consumer goes through the Web site and configures a vehicle, all the purchase requirements are in Siebel. So when a customer calls in and talks to their vehicle specialist, he can get on Siebel and see exactly what the consumer has configured and what the data is.

We have state laws that we have to abide by and do a lot of recording in our CRM system. We track every piece of work we do with a dealer — from the prospecting of the dealer to the actual product and order, invoicing and payment — all the way through the process.

For the dealers used-car ads, we put their branding on our site. For both new and used cars, we track consumers as they go through our site and also track whether they call the dealer 800 number or e-mail the dealer. So we have quite a bit of tracking to show the dealer how the consumer we sent to them is behaving.

On a monthly basis, we provide a score card for our dealers that shows them the number of consumers that you got from our Web site and the number of calls and e-mails that they received. We can also tell them how they responded because we talk to consumers and find out what their experience was like. So we have a lot of detailed data for dealers.

This has been a well received tool by our dealers. If they want to know in detail why a car isn’t moving off the lot, we can give them information about our national averages from other dealers — give them advice regarding the car pricing, their responsiveness to consumers. Some dealers really use the data and take action on their end.

CRM Buyer: Who’s your competition?

Domeyer: We see as the only one-stop car shop online, because there’s no other company out there that does what we do across the board. Similar companies tend to be specific in other areas like research or used cars or other areas. We do it all. You can buy new and used vehicles online; you can do your research; and we have both general and special financing available.

CRM Buyer: What’s your enterprise environment like?

Domeyer: We have a pretty sophisticated environment. We’re primarily a Java JSP [Java Server Pages] shop. We use primarily as our with some SQL Server. jBox is our application server and Apache is our Web server. Siebel is really at the heart of our operation, and we use it for most of our back office fulfillment. It ties into our Lawson financial system.

CRM Buyer: Are you using Siebel’s eAutomotive?

Domeyer: Yes and we’ve expanded it quite a bit. We’ve had two phases to Siebel. The first phase was our direct sales floor, which is approximately 120 people, including customer service. And that’s where a consumer will go online and purchase a car through us. Then about nine months ago, we added our referral model, called our connect channel, which refers consumers based upon configurations and geographies to dealers near them.

At this point all of our sales activities are on Siebel, though our connect channel, the invoice and payments to CarsDirect come directly from dealers. I don’t think there are any other applications out there today that do invoicing and payment using Siebel. We just simply run a report in the financial system that shows what the revenue is. Each month, we’ve significantly reduced the amount of time it takes to close the books because of this. It used to between seven and eight days to close the books, and now it takes about one. It’s really made life simpler for the finance people.

EAutomotive is working great for us. For both direct and connect solutions, it took us only four to five months to implement the solution and it worked right away and has remained stable. Siebel isn’t a heavy code environment but involves more configuration types of changes. So we don’t need to have really senior developers, we just need people that have some development skills and can learn the environment so that they can make changes quickly. It was also set up well using automotive industry expertise, and it was setup so that we could jump in pretty quickly and start using it.

From the consumers’ perspective, we hold all their data in Siebel, but they aren’t aware they are interacting with it.

CRM Buyer: Because CarsDirect operates 24 by 7, how do you keep everything running?

Domeyer: We use a lot of automated alerts on both our Web site and for Siebel. For example, should any part of our operation start having a performance problem, several people are automatically alerted, and so we know in a minute or two that we are experiencing problems. We also have monitoring tools that are tied in so that we can see what the performance has been on an historical basis to see if we are running into memory problems or CPU I/O problems. The trick here is to make sure that you have the tools in place to get automatically alerted should there be a problem.

Making changes to the system is critical for us. We have a thorough QA [quality assurance] process. Before any change ever gets pushed to production, we do a full regression QA test, and if it’s a major change, we will do a full load test. Obviously, we use automated tools to manage this, otherwise we could push things out that could break the site.

We’re good at testing everything in our staging environment. We push new code there to see if it degrades the performance, and if it does, then we take it back, make modifications to the code and try it again. Using this process, we’ve not put anything into production that has caused a load problem. In our staging environment, we can simulate pretty close to what our production environment would be — although we simulate more users.

CRM Buyer: How do you update and renew the CRM portion of your environment?

Domeyer: CarsDirect has a pretty structured process at the executive level regarding how we get projects prioritized. On a quarterly basis, we present technology projects, and each executive has to justify their projects in front of their peers and justify their projects from an ROI perspective. In my case, the justification is more from an infrastructure basis to show that we need it to be able to continue to scale, create more products and support more customers. It’s hard to put an ROI when we’re adding two application servers, so I need to justify it on what we need infrastructure-wise. For example, if our server I/O utilization is at 70 percent and 85 percent of memory, I can make the case using those statistics. I also provide a budget for the project, implementation timeline, any impact on support costs and so on. We also do this as well for upgrades like Siebel.

Today our connect channel product runs on Siebel 7 and our direct channel product on Siebel 6. We will soon be combining these environments and updating them to Siebel 7.

Our ongoing strategy is to watch and see what the new version is like. We send someone to the Siebel user conferences to keep on top of where their technology is going and what the new releases provide us. Based on such information we make a decision about when to upgrade. We consider the new functionality that would be beneficial to us, performance, the impact of architectural improvements on what we are doing, as well as how easy it will be for us to migrate up by providing tools and assistance.

We do a build on a monthly basis. And we tend to new functionality in the middle of the night when it has the least impact on our employees. We rarely bring down the system when it impacts the users. If we do, we try to do this around a lunch break or another time when it impacts users the least. Then we notify them about the changes via e-mail and let them know what to expect.

People are very supportive of Siebel. It really helps them do their job. There’s a lot of feeling of support for the product. I’d even say that they enjoy using the technology.

CRM Buyer: Is there any seasonality based on new car models coming out to your business?

Domeyer: We’re pretty busy throughout the year. What we see is a steady rise in Web site usage throughout the year, with a crescendo from August through October, then another spike in the November and December timeframe. The challenge in the model year turn over is the manufacturers and dealer will put certain cars at discounts to push them off their lot, and sometimes they are looking for the very new vehicles, and there are very few of them.

When the consumer commits to buy a car, we have forms that he fills out, and those go to the dealership. We can transmit this information through Seibel as e-mail, XML documents, automatically fax them. Because dealerships are largely not automated, faxing the information is the most popular means of dealer communication.

CRM Buyer: What do you see for the future of CRM at CarsDirect?

Domeyer: What we may end up doing is developing a kind of an extranet so our customers — dealers, consumers or manufacturers — could tie in even closer with us. We also have a lot of valuable data that we gather for dealers and manufacturers in terms of what consumers want based upon their research. We are more and more looking at possibly providing more of that to the dealers and manufacturers through an extranet built into our CRM system. We track consumers through our Web site and can see exactly what configurations they’ve selected, what models they compared, which one they finally submitted a lead on. So we have the consumers’ shopping behavior that can help guide manufacturers about which vehicles to produce.

This story was originally published on July 26, 2004, and is broughtto you today as part of our Best of ECT News series.

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