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January 2018, F&I and Showroom - Cover Story

by Gregory Arroyo and Stephanie Forshee

Tom Murray and Steve Zabawa are in no hurry when it comes to their digital retailing platform. Even as other ecommerce startups have made national headlines, the creators of WebBuy have remained methodical about the way they’ve rolled out the capabilities of their “end-to-end, online car-buying experience.”

Remaining in stealth mode since they began developing their Amazon-like checkout solution in 2014, the two co-founders soft-launched WebBuy to a select group of dealers, finance sources and OEMs during the 2017 NADA Show last January. Since the convention, Murray and Zabawa have been flying around the country, showcasing their creation to the automotive retail world.

“We flew under the radar purposely because we believed we had crafted the correct digital selling solution and wanted to retain our proprietary value drivers,” says Murray, WebBuy’s CEO. “We’ve had the approach validated as other entrants into the space, who began their life as a, for example, lending app or lead-gen app, are now trying to play catch-up to create what we’ve spent the last five years developing.

“One thing that’s interesting is everyone we’ve interacted with — who has vetted our solution — says the same thing: ‘You’re the only ones who’ve truly figured it out,’” he adds.

What they figured out is a platform that fully connects consumers, lenders and dealerships through a single app. That description might sound familiar, but there is plenty that distinguishes WebBuy from the sea of startups looking to transform the automotive retail landscape.

For one, the system is free to both consumers and dealers. “It’s called ‘freemium,’” Zabawa says. “We get paid when loans go through the system and when car dealers are successfully selling cars and accessories.”

The same will be true for F&I products when WebBuy’s online F&I menu goes live. It’s now in beta in a few rooftops currently using the platform. In fact, the finance portion of WebBuy won’t be fully unleashed until the first quarter of 2018, when a newly forged relationship with RouteOne takes effect. Murray notes, however, that the step-by-step rollout is just part of plan.

“It’s important for people to understand that, when online retailing becomes a reality, it will still only comprise a nominal percentage of the marketplace,” Murray says. “Our solution is geared toward the internet department or BDC to not only improve conversion rates on web inquiries, but allow them to finally facilitate a true 360-degree online sale. It’s also a lead-generation tool designed to convert more people who don’t complete the checkout process.”

Steve Zabawa and Tom Murray began developing their Amazon-like checkout solution in 2014. The cofounders remained in stealth mode until they soft-launched WebBuy at NADA 2017. The platform counts eight dealer groups as investors, and is free to both consumers and dealers.
Steve Zabawa and Tom Murray began developing their Amazon-like checkout solution in 2014. The cofounders remained in stealth mode until they soft-launched WebBuy at NADA 2017. The platform counts eight dealer groups as investors, and is free to both consumers and dealers.

Dealer-Created, Dealer-Funded

WebBuy’s creators aren’t Silicon Valley techies. Murray is the former president and COO of Resource Automotive. Zabawa is the co-owner of the five-store, seven-brand, Billings, Mont.-based Rimrock Automotive Group. Their goal was not to solve consumer complaints about the car-buying process; it was to provide relief to dealer pain points in the Digital Age.

“What we’ve created is, in essence, a digital, 10 steps to the sale,” Murray says. “We’re car people, and we wanted a solution that was completely dealer-centric while maintaining a terrific consumer and user experience.”

Zabawa says his inspiration for WebBuy was watching his kids buying items on Amazon. He wondered why cars couldn’t be purchased the same way. Murray left Resource Automotive in 2012, about three years after delivering a keynote address at Industry Summit 2009. During that address, he talked about the need for dealers to use the Great Recession to rethink their operations, pointing to retail strategies employed by companies like Walmart and Amazon as models to consider.

The pair put their heads together, spent millions of dollars and almost two years of research and development to create their platform and mobile app. And their efforts attracted investments from eight dealer groups. Fifteen months before NADA 2017, the two began piloting WebBuy at Zabawa’s dealer group.

As Zabawa recalls, WebBuy’s very first customer was a Billings resident who stopped by the dealership on a Saturday night about a half hour after it closed. The customer was looking at a $20,000 pickup truck he saw on the lot. So he used his iPhone to look up the stock number on Rimrock GMC’s website and saw the price, with tax and all fees included. Since he didn’t have a trade-in and was paying cash, the customer selected the checkout option and put down a $500 refundable deposit to reserve the car.

The store was closed on Sunday, so the customer arrived early Monday afternoon to take delivery. The truck was washed and waiting on the show floor. The finance manager was also ready; WebBuy had already delivered forms the customer filled out online. He was in and out in about 45 minutes — after paying cash for a service contract. And according to Zabawa, not only did the dealership make a profit on the truck and the F&I protection, the customer didn’t flinch at the dealership’s doc fee.

“I’m a dealer myself, so we want to make sure the dealer continues to sell cars profitably,” he says.

WebBuy’s full capabilities will soon be unleased thanks to a newly forged relationship with RouteOne. Tom Murray, the startup’s CEO, says more than 1,300 finance sources will be available to car buyers who engage WebBuy’s finance process once integration is completed this month. The firm is also beta-testing an online F&I menu.
WebBuy’s full capabilities will soon be unleased thanks to a newly forged relationship with RouteOne. Tom Murray, the startup’s CEO, says more than 1,300 finance sources will be available to car buyers who engage WebBuy’s finance process once integration is completed this month. The firm is also beta-testing an online F&I menu.

The Process

WebBuy’s five-step process kicks off once the customer lands on a vehicle and hits the “Buy Now” button. It begins with a review of available incentives, followed by a page that allows buyers to add vehicle accessories. Customers are then asked to enter the VIN and mileage on their trade-in to engage WebBuy’s proprietary vehicle appraisal software. It poses up to 20 questions — which dealers can customize based on their specific inventory needs — about the condition of the vehicle.

The finance section opens by allowing buyers to adjust down payment, then asks for their consent to esign documents and disclosure statements. The system then moves on to the credit application process, which is broken up into three sections: general, address, and employment information. Once the app is submitted, a real-time decisioning system delivers up to five lender-approved finance offers with rebates, incentives, tax, title, and license included.

When integration with RouteOne is completed this month, Murray says more than 1,300 finance sources will be available through the WebBuy platform.

Rimrock’s new president, Rick Welty, only needed two weeks on the job to be convinced of one thing when it comes to WebBuy leads. “They’re probably the best I have ever dealt with, for the simple fact that when you get a WebBuy lead, you have a golden opportunity to capture an actual buyer who is ready to do business right then and there,” he says.

Welty has been in the industry for 15 years. He recently moved from Southern California, where he ran two Honda franchises and a Toyota store. In that market, he says, 80% of his business was driven by the internet, which is why the first thing he did when he arrived at Rimrock was inspect the group’s internet process. And what he discovered was that WebBuy leads the board in closing percentage.

But what impressed Welty the most is the information it collects from customers. His sales teams know the exact model, color, and trim level, which sets the stage for a streamlined experience once the customer arrives. It’s one of the reasons, he says, the group’s F&I operations is closing in on $2,000 per copy.

“If we can streamline the sales process, which makes the customer less sales-resistant when they get here, we will have the opportunity to capture our money with the back-end products,” Welty says. “But you still need a full staff and you still need to train every day. And you still need to be on top of every lead and give that customer that wow factor.”

The Customer Journey

Toledo, Ohio-based Taylor Automotive Family is one of the eight dealer groups backing the WebBuy platform, which has been in use at the eight-rooftop operation for the last six months. Nick Marconi, the operation’s marketing director, says WebBuy is great at turning leads into buyers, noting that the group is achieving a 50% credit app response rate thanks to the solution.
Toledo, Ohio-based Taylor Automotive Family is one of the eight dealer groups backing the WebBuy platform, which has been in use at the eight-rooftop operation for the last six months. Nick Marconi, the operation’s marketing director, says WebBuy is great at turning leads into buyers, noting that the group is achieving a 50% credit app response rate thanks to the solution.

One of Zabawa and Murray’s main goals with WebBuy was to make dealer websites “sticky,” even if the customer doesn’t engage the platform’s digital retailing process. That’s why, after surfing any and all facets of the WebBuy app or dealer site, shoppers are asked to enter basic personal information to create an account before engaging the platform’s buying process. The same goes for saving vehicle searches and receiving price alerts.

It’s that simple step that allows the Toledo, Ohio-based Taylor Automotive Family, one of WebBuy’s investors, to keep tabs on what a customer clicks on — whether it’s a vehicle, the color, an accessory, or the loan term. And with that information, the group, which retails between 800 and 1,000 units per month, can send an offer or promo catered to that specific shopper, who can engage and re-engage WebBuy at his or her own pace.

“So they can start the process at work, talk to their spouse maybe that night, add their trade-in info, or enter a VIN to get a quote on a vehicle,” says Nick Marconi, marketing director for the eight-rooftop group. “For some people, it’s a 60- to 90-day process to shop for a vehicle. If they create this profile, it’s kind of an easy step-by-step process that allows them to add to the cart, whether it’s submitting a credit app, picking a down payment or trade value.”

Customers have even put down deposits to reserve vehicles through WebBuy — mainly on the pre-owned side, Marconi adds. As for its effectiveness, Marconi says if the group’s BDC sets 100 appointments on WebBuy-originated leads, 80 of those customers will show.

Marconi admits he wasn’t a believer when the group’s founder, Stephen Taylor Sr., first approached him and the group’s current operator, Taylor’s son Stephen Jr., about WebBuy. While in their early 40s, Marconi says they just didn’t believe consumers were ready to make a $20,000 purchase online. But they’re believers now.

“I think everything you see out there is nothing more than a lead catcher. WebBuy takes those extra steps to make that lead a buyer,” Marconi says. “By the credit apps we’re getting, the deposits we’re receiving, we are selling online.”

In fact, the group is achieving a 50% credit app response rate thanks to WebBuy. Marconi says once customers form the shell of their deal by selecting a term and down payment, the desk manager can enter WebBuy’s admin panel to see what they have selected. His desk managers, at least as of December, then email a link to the group’s online credit app.

“If they’re going to be a lower score, the desk manager or F&I manager may ask the salesperson to make a few calls to get proof of income,” he says. “So now they jump on WebBuy, start structuring the deal and put out a few calls. So when people come in now, it’s not, ‘Do you think you want to buy?’

WebBuy is also driving accessory sales, leading the group to ask its manufacturers for more than the basic packages Taylor Automotive currently carries. Marconi believes WebBuy simply puts customers in a buying mood, allowing them to see how an accessory purchase impacts their monthly payment. He expects the same will happen for F&I products.

“Some of our hardnosed desk managers and F&I guys would say, ‘We’re not going to work a deal until the customer steps foot in the dealership,’” he says. “Now they’re pulling into the admin tab. It just comes down to saving time.

“What we’re excited about is when the finance portion of WebBuy goes live.”

Murray says each dealer can choose how much they want to put online, adding that not every store currently using WebBuy is interested in adding the online F&I menu. Either way, he thinks the business office stands to gain the most from the platform he and Zabawa built.

“If I’m an F&I manager and someone told me that half of the people backed up 10 deep on a Saturday waiting for a delivery completed 90% of the paperwork before they arrived, including hanging their own paper — and I’m likely to get a raise in the process — I’d be thrilled.”

Comment

  1. 1. Tom Murray [ January 08, 2018 @ 03:51PM ]

    Thanks for the opportunity to share WebBuy with the world. Feel free to e mail me at t@webbuy.com with any questions.

  2. 2. Glenn [ January 10, 2018 @ 09:21AM ]

    Finally getting modernized with a new generation!
    Hello Tom, I'm an independent F&I consultant for 15 years now. Fyi I've been selling Resource products for over 24 years. Thought you would like that since you were the former COO lol.
    I've already established my own business helping dealers with everything F&I. The duties, training, emergency help, etc...I was wondering if your company will be needing company representatives or agents for covering accounts or territory? This could be something I would like to do since I'm independent without a conflict of interest with my F&I business.
    Let me know what you think?
    Thank you, Glenn

  3. 3. Tom Murray [ January 10, 2018 @ 12:19PM ]

    Hi Glenn, Feel free to e mail me your resume to t@webbuy.com. Best, Tom

 

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