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Friday, June 23, 2006 

Vol. 2 No. 24

iRem@rketing 2006 –Technology Changes Everything. Part II.

Jack Nerad (left) answers questions from the audience after his keynote address

The second day of the iRemarketing conference kicked off with an excellent keynote address by Jack Nerad, Editorial Director and Executive Market Analyst, Kelley Blue Book’s “kbb.com.” As Jack is an experienced media personality, best known for his national radio show, “America on the Road” and his television appearances on the History Channel’s “AutoManiac,” his presentation on the changes technology is bringing to the car business was outstanding.

One of the strengths of Jack’s keynote was to point out the profound change that widespread use of the Internet has made on the used car industry. According to Jack, “The Internet is the most important technology to affect the buying and selling of automobiles since the popularization of television in the late 1940s and 1950s.” It occurs to me that the very fact that there is an annual iRemarketing conference, subtitled “the technology conference of the used car industry” underscores this truth, particularly in the area of used car remarketing. Even as recently as 15 years ago there would have been no need for a conference such as this, as, I dare say, the business hadn’t changed in 50 years. Before the mid 1990’s or so there was very little technology or innovative procedures in the used car end of the business. But boy, how life has changed.

What Have You Done for me Lately? Say, in the past 5 minutes?

More skilled presentations you couldn’t ask for. My old IRBR friend and colleague Jim O’Brien gave his usual informative and upbeat presentation of Lanelogic; Jim is the president of Lanelogic, probably one of the most visionary concepts ever to launch in the world of used cars. Introduced at the last NADA convention, and now rolling out in selected markets, Lanelogic looks to be the “first used vehicle market maker” utilizing real time sales data and market intelligence to conduct electronic trading between dealers nationwide. As Jim explains it, “our trading floor instantly determines the top market value of the vehicle a dealer wishes to sell or appraise and returns a guaranteed buy bid within five minutes, risk free.” Now, as a testament to how recent technology has accelerated change, I can’t even imagine such an innovation being introduced back when I was a dealer…some of the dealer friends I knew would have taken the whole thing about as seriously as the latest “Star Trek” rerun…and yet now, Jim tells me over 1,000 dealers showed interest in this system at NADA, and the list of inquiries keeps growing…

The Water’s also fine Midstream

It was a pleasure to be in the audience of a workshop conducted by another “Jim” I know, Jim McKnight, introducing the new and improved (under his leadership) Manheim Online Vehicle Exchange (OVE). While I always thought of any vehicle put up for sale that didn’t take place while said vehicle was still in service, or just out of service, as “downstream,” Jim identified Manheim’s OVE as a “midstream” sales platform, sitting between us “upstream” sellers and the downstream, physical auctions. So, while I’m still not 100% convinced that what isn’t “upstream,” is, by definition, “downstream,” Jim conducted a great workshop which laid out the basic value proposition for using an online marketplace before a vehicle goes on the physical auction block. Now again, I have to say, given that Manheim owns the largest group of “bricks and mortar” auctions in the country as well as OVE, this presentation on the value proposition of an online auction maybe would have been just as outlandish an idea when I was a dealer, as LaneLogic’s would have been – how time and the irrepressible benefits of technology change an industry…

Pat Ryan, CEO/Founder of First Look, one of the first used vehicle inventory management systems and a leader in the field, led a workshop demonstrating how First Look technology can help dealers more efficiently stock and control used vehicle operations. With the used vehicle department producing more gross and net profit than new vehicles -- even for franchise dealers -- the advantage of using tools such as First Look to anticipate consumer demand cannot be ignored. First Look recently partnered with the ADESA auction folks to provide the supply side of the equation, in which the First Look platform software identifies for a retailer what their local customers want in specific vehicles. Being an ex-retailer myself, I know that the true value of any used vehicle management system software is only fully realized if it meshes with the online platforms that provide vehicles (upstream, downstream, midstream). So in this partnership, I think Pat has defined the value proposition for the present and future.

Other workshops included a couple of retail “sell side” uses of technology, with Rob Chesney and Tom O’Leary outlining the advantages of selling inventory on eBay Motors; and Matt McKenna, from AutoTrader.com, outlined the new innovations in the nation’s largest used car online classified platform. Finally, Greg Mahugh and Ty Brewer presented a workshop on Auction Pipeline, a collaboration of seven physical auto auctions in the Northwestern United States that joined forces to offer a united online presence for sourcing inventory and merging their buyer groups for auction clients.

…And at the End of the Day, Catching up with Industry Friends…

And of course, the receptions each night on the exhibit floor gave plenty of time to network, meet new people, and say hello and catch up on news with some old friends who I haven’t seen since the last remarketing conference. In this case, some pictures probably tell that story best…

Tom McNutt, owner of McNutt Auto Transport Service, talks with a visitor to his booth

Jim McKnight, President of Manheim’s Online Vehicle Exchange, talks with Mark Jensen, Senior Vice President & Chief Operating Officer of AutoTradeCenter/ATC

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