What does a startup from Silicon Valley know about the automotive
industry? Nothing — and that’s the point.
If you had asked me 3 years ago if I thought we would be partnering with Longo Toyota, the largest dealership in the world, I would have found it hard to wrap my mind around. So, today’s announcement marks a very important milestone in our company’s history.
When we first started Roadster, the founding team had very little knowledge of the auto industry. Most of us hail from the fashion space and were part of the ecommerce movement at a time when people didn’t think they would buy clothes online. After successfully launching two ecommerce startups I was able to get the band back together and ready for a new adventure. We looked at many industries, but in the end decided to tackle the car buying experience, as it felt very much like fashion did in the early 2000s. Automotive was one of the only industries left that had not adopted the modern online purchase process.
We didn’t jump straight in without
skinning our knees and scraping our
elbows. We took it upon ourselves to
learn how to sell cars first hand.
In 2014 we purchased a local car brokerage and began to automate the car buying process. This forced us to learn the complex intricacies of inventory, pricing, financing, leasing and trade-ins early on, as well as the data structures needed to display near pencil perfect deals. It also allowed us to leverage our user experience know how to make these complex scenarios super easy to use and modern for today’s consumer– an end to end buying process that car shoppers across California came to love. Our net promoter score rose to over 95 (which is unheard of) and before we knew it we were selling almost 120 cars a month directly to consumers 100% online.
Along the way, we learned that selling cars is not for the weak at heart. We gained a lot of respect for the dealership community who has honed their processes over decades in regards to the physical nature of the business– storing inventory, hiring, insurance, liability, lending, contracting, servicing & selling parts. These components are critical, whether someone is buying 100% online or not.
It didn’t take long for several of the local dealers who were receiving orders from our concierge business to step forward. We began to hear a common theme —
Dealers started saying “We really like
what you are doing, we just want to
have it for ourselves.”
As much as we were ready to take our direct-to consumer model across the country, there were operational complexities to be hashed out if we went at it alone. We asked ourselves the question– why not partner with the existing distribution network that already has those operational components in place? Enough interest bubbled up that we decided to pivot the business to a SaaS based commerce platform for dealers, and in July 2016 we launched our first Express Storefront with Toyota Marin of the Price Simms Auto Group.
Fast forward to today and our consumer first mindset remains at the center of every product decision we make. The platform is now used by over 70 dealerships across 22 brands and 21 states. Our consumer first approach has meant going beyond ecommerce and building out beautiful tools to be used in-store with customers on ipads, swivel screens, mobile phones and even 6 ft. tall kiosks– connecting the dots between activity happening at home and what takes place on the showroom floor.
Because of everything we have learned in building our car brokerage, we have the most comprehensive product on the market. We have spent time sweating the details on everything from taxes, incentives & rebates to finance & lease terms, and have added service plans and accessories as the product has grown.
But end-consumers weren’t our only customers, dealers were too, and our dealer advisors ensured we did a lot to drive in-store efficiency for their employees as well. Thanks to their counsel, we democratized information across the dealership so that salespeople can access information without ever leaving the customer’s side. Our platform has become as much about the salesperson and how we can help them co-shop with their customers as it is about creating an incredible consumer experience. Now salespeople can act more like genius bar advisors, keeping car shoppers engaged with interactive tools, and easily answering questions customers have along the way.
I am proud to see the customer satisfaction scores of our dealer partners skyrocket. The average net promoter score of a Roadster partner dealer is 85, while the average for automotive retailers remains in the mid 40’s. And they are saving time as well. Some of our dealers estimate that they have saved up to 3-6 hours of employee time per transaction. The ultimate win-win.
The online buying space is heating up with new entrants like Carvana and Vroom, and established entities such as AutoNation, Sonic and GM, to name a few. We are giving dealers the ability to modernize and compete with these new entrants, changing the dynamics of the customer experience as we know it today.
The good news is that the industry is ready. Inbound demand for our product has more than exceeded our expectations. On July 31st we closed an additional round of funding with Costanoa Ventures as the lead investor. Not only will this fuel sales and support growth, but we will invest in continued innovation to maintain our position of having the best of breed offering.
We now have Express Storefront live with some of the largest dealerships in the country– Paragon Honda, Crown Toyota, Rallye BMW, Norm Reeves Honda Irvine and the Price Simms Auto Group to name a few; and as I mentioned previously, we just onboarded Longo Toyota, who is literally the largest dealership in the world. With huge scale, comes great opportunity for increased efficiency and customer satisfaction. We are thrilled to have Brendan Harrington and the Longo team as part of the Roadster family.
“We believe it is the most modern and
comprehensive solution on the market.”
– Brendan Harrington, President Longo Toyota
In reality, the journey has just begun. This is our second chapter. Our hyper growth moment. I cannot wait to see where this journey takes us!
Andy is the founder and CEO of Roadster, the leading provider of consumer-driven Commerce Solutions for the modern dealership. To learn more, or request a demo, visit: roadster.com/express-storefront