CARFAX Reminds Us of a Valuable Lesson: Never Forget Who Your Customers Are

While CARFAX has created a demand for their reports through engaging and selling the consumer on the value of their reports, their primary customers, those paying the bill, have always been car dealers. These are the people buying and paying for the lion’s share of the reports CARFAX sells every year, and these are the people that CARFAX should never forget.

But they have recently engaged in a practice that has upset car dealers. CARFAX has initiated a pricing practice with their reports where they indicate price reductions and increases (the increases seem to appear less often than the discounts) called the “CARFAX History Impact”, which should be applied to the car in question for assessing a reasonable price.

From all of the chatter on various websites, blogs and forums, this change has bothered quite a few dealers. It appears that CARFAX initiated this practice without asking their car dealer customers how they felt about such an addition. This issue surely would have come out if CARFAX had worked with a dealer focus group around the change. There are other issues around the History Impact element such as there is no actual explanation for the reduction or increase. The reader is left to ponder that one on their own.

You can read more about this on these sites:

http://www.automotivedigitalmarketing.com/profiles/blogs/carfax-walking-a-thin-line-1

http://forum.dealerrefresh.com/f43/carfax-car-values-their-new-price-calculator-907.html

http://jimbellthecarguy.wordpress.com/2010/04/29/has-carfax-gone-too-far/

http://www.drivingsales.com/blogs/paschconsulting/2010/04/28/carfax-shocks-dealers-with-pricing-data

As Jeff Kershner put it on the DealerRefresh forum:
“CarFax – what are you thinking? Could you slice your own throat any deeper?

CarFax decides to take it upon themselves to determine how a CarFax history report “should” effect the price of your inventory.”

Now, I’ll grant that it is possible that this new feature might become a tool that dealers are able to use to help sell a car, but that remains to be seen. The question I would like to ask is “Even if it turns out to be a positive result in the end, why would you blindside your customers like this?”