Greg Ellis, CEO of Scout24 AG

Greg Ellis is the CEO of Scout24 AG, which operates real estate and automotive classified businesses in Europe. Its main brands are ImmobilienScout24 (real estate) and AutoScout24 (automotive). JobScout24, a recruitment vertical, was sold in 2011.

Originally from Australia, Ellis joined Scout24 Group in 2014 after serving as the CEO of real estate classified giant REA Group in Melbourne.

Ellis will be speaking at the AIM Group’s AutosPlus2017 classified conference in London next week. We asked him to describe what makes Scout24 unique and what changes and challenges he sees in the coming years.

We asked:

What unique challenges do you face in your market?

Ellis: AutoScout24 operates in seven countries in Europe. The functionality of the sites is about 90 percent the same, although there are some differences of course — new cars are more important than second-hand cars in Italy; in Germany it’s more one-to-one between new and used. We basically just localized for price and language.

We don’t face anything in our market that’s particularly unique — it’s the way we go about solving the problems that is different. We see ourselves as a purpose-driven company, not a strategy-driven one. That means we spend a lot of time understanding the customer journey — where they are, who they are – as we inspire people to make the best decisions about homes and cars. We focus a lot on personalization beyond the normal search experience.

What will you be speaking about in your presentation at AutosPlus2017?

Classified businesses in different countries should be less isolated and work together more productively. At AutoScout, for example, we see how large OEMs don’t think of “Germany” or “France.” They think in terms of Europe as a whole and they will buy advertising across four to five classified businesses and regions.

Why is this important? The needs across Europe are diverse. For example, the Netherlands has a shortage of second-hand cars, while Germany has a healthy supply of used vehicles. We should be working to push supply and demand of second-hand cars across borders.

In my talk, I will discuss how classified businesses can find ways to interoperate with each other without getting in each other’s ways. That makes them different from large internet companies that will never share the information they collect.

But the OEMs need this information if they’re going to launch a new product across multiple markets. To become really engaged partners for the OEMs, classified businesses need to provide deep local and pan-European information.

How big a part of your business will artificial intelligence (AI) become?

It’s a very important part of the business already. We used AI to launch Germany’s most accurate car-evaluation service, using the ten million vehicle records we have in our AutoScout24 database to calculate prices. We also use AI to recommend vehicles — the more information we have on a user, the more accurately we can do that.

In the next two to three years, we won’t be releasing a product that doesn’t have a major AI component. We want to give better information to automotive dealers about how quickly their stock is moving, which vehicles and why. And we’ll provide information to OEMs, such as which dealers are performing the best and how to more effectively anticipate supply and demand.

We see a lot of changes in automotive classifieds. What are the most interesting developments worldwide you’ve seen so far?

The classifieds business is not actually about classifieds anymore. In the print world, classifieds used to mean selling space. These days, there are many exciting new developments taking place, from selling cars directly to consumers to making the most of the adjacent businesses, such as credit finance and insurance, to supplement the core business.

In your opinion, what are the biggest challenges the automotive classified industry faces in the next three years?

Most classified businesses make money on the second-hand car market. They need to get more aggressive in the other two macro markets: private sales and new cars.

Classified businesses also need to get involved in financing and insurance. People don’t buy a specific car and finance it anymore. We now have perpetual financing agreements and you roll multiple cars through that over time.

Finally, there is the emergence of on-demand driving. This will not be mutually exclusive with other types of car ownership. For example, just because I hire an autonomous car that can park itself doesn’t mean my wife won’t have a rolling contract for her own car.

Classified businesses can be an aggregator of these infrequent purchases. Using AI capabilities, we can tell someone that, if they want a car in two hours, there’s one 100 meters away from you. Most people in the industry are too binary in their thinking of how we will use cars going forward.

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