• Marketplaces coming into direct competition with their customers
  • Dealers often don’t respond to marketplace leads
  • Advanced call tracking with AI can help convert leads

“It’s a dangerous, crazy time for marketplaces,” Ryan Gallagher, founder and CEO of communications analytics company Iovox, told the AIM Group.

Many marketplaces have moved beyond lane in recent years, pivoting from driving leads for dealers to selling cars direct.

“If you’re selling cars, you’re going into direct competition with your customers. If you’re selling leads, how do you make that better?” he said. “There has been a clash between marketplaces and the really big manufacturers who say ‘what do you mean you’re building a tool for people to buy cars online — you used to drive leads to us?’”

Gallagher offered a word of caution to marketplaces: “If the dealers pull away, you’re in big trouble if you aren’t big enough to take them on.”

It’s all about the leads

Iovox believes it can provide the necessary tools to help counteract this risk.

The business started in 2007 in the U.K., and has since expanded globally to 60 countries when engineer Gallagher addressed the mass explosion in mobile communications.

Iovox takes localized communications, whether phone calls, SMS, emails, chat or messengers like WhatsApp, to monitor leads and conversions through advanced call tracking, lead generation and conversational AI. It does this for various business segments, including automotive marketplaces and dealerships.

Meeting the needs of changing consumer behaviour

The covid pandemic was a turning point in how many customers interacted with dealers, moving from voice-calls and physical visits to textual chat and online forms. “People got used to talking through their computers instead of a phone,” Gallagher said. And marketplaces and dealers had to evolve to this new digital landscape.

Using conversational AI, Iovox can coach sales representatives to improve lead qualification and spot upsell opportunities by identifying key words or triggers to discover what the customer needs. As Gallagher explained, “Does this person need finance? If so, was an appointment booked? If not, send an email to the finance company saying this person needs finance.”

AI-driven improvement of leads for marketplaces, OEMs and dealers is a big growth segment. For example, Russia-based horizontal Avito is working with RescueLead in automotive to monitor lead quality. U.K.-based Media Hawk works directly with dealer groups and auto makers such as Kia, Inchape and Dick Lovett — it tracks calls and manages inbound leads. Another U.K.-based lead analytical tool is DriftRock, which uses API integration to optimize performance and conversions.

Iovox transcribes each call and highlights key phrases to help sales teams spot trends and opportunities. As well as identifying if consumers need finance, it determines if they have a car to sell, and even esoteric intelligence like ‘what’s driving their purchase decision?’

Iovox claims a 700% increase in phone engagement by changing the placement of phone numbers on site, with 50% more leads generated by phone and a 20% boost in web leads. Customers include auto marketplaces like Auto Trader Group in the U.K, Cars.com in the U.S., and Done Deal in Ireland.

Boosting dealer response rate

Driving leads is one thing but converting them is another, especially if the marketplace is driving cash offers or finance leads on a revenue share. Often, in Gallagher’s experience, the dealers either ignore the leads or are slow to respond. “One of our customers right now has a 50% response rate, which is appalling because they’re trying to make money off this,” he said.

“It is essential that the contact following a customer request is done quickly after submission to meet the expectations of prospective car buyers,” Jean-Alexis Bidet, the marketing department manager at the automotive division of OEM Honda Motor Europe Ltd, said.

Honda is currently working with Iovox.

Improving Trust Pilot scores

Auto Trader in the U.K. used Iovox’s services to improve its scores on Trust Pilot, the consumer review site.

“They were getting slammed for bad customer service, so we worked with them to protect the privacy of sellers. We blocked millions of spam calls every month,” said Gallagher.

Within around six months, Auto Trader’s Trust Pilot score improved from 6.7 to 9.3 out of 10.

“At Auto Trader we are constantly looking for initiatives to further the protection and trust between buyers and sellers,” Kelly Jessop, product lead at Auto Trader, said,

Through its work, Iovox is sitting on a potential goldmine of data, but it has no plans to monetize it. “People try and buy our data all the time,” added Gallagher. “But we’d never sell data.

“Everybody’s jumping into AI and pulling ‘off the shelf’ products like ChatGPT, which is a massive privacy minefield,” he said. “We’ve been doing AI for quite a long time now. Everything we do is hosted by ourselves and we don’t use shared resources, we train our own models.”

Gallagher bootstrapped Iovox from previous ventures, but in 2021 the business received capital from Cazoo and Zoopla investor Octopus Ventures as well as private investment. Since then, it’s been self-funded. The company is now profitable, has cash in the bank and is turning over “double-digit millions of pounds.”

In the past few years, Iovox has acquired rivals and migrated them to its platform. Its growth is being driven through a mix of organic and acquisitions.

There is always room for improvement of the product, and many challenges remaining.

“We have millions and millions of calls to train models on. The future of this industry and the future of our company is around using the information. We have to become smarter and better able to make sense of conversations,” Gallagher told us.

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