Test pilot
Once ideas have been vetted and align with the company’s goals, then the last phase before implementing them into your strategy is to test them.
“A willingness to take risks and experiment is very important, because the good ideas stop coming if people think there’s no chance it will ever get implemented because they’re viewed as too risky,” Perry says. “You have to be willing to experiment, make mistakes and iterate toward a better solution in order to promote an innovative environment where people feel safe to make suggestions that are outside the box, and then the company has to be willing to methodically test and evaluate them.”
The key is to start small.
“The good approach is to try and test an idea in a portion of your business,” Perry says. … “Test in a portion of your total-served market and then observe success and problems and try to iterate and evolve toward a better solution before you roll it out.”
At AutoTrader.com, when it wants to try out a new idea, it is tested in one or two markets. For example, one offering AutoTrader.com has been working on is a tool that offers a seller an instant offer on their car. Sellers describe it, and then dealers can make offers to them, which are contingent on the car matching the description provided. If a seller sees an offer he or she likes, he or she can go to that dealer, have the inspection, and then get a check on the spot. Dealers like it because it brings in prospective buyers. Sellers like it because they can get an offer fast.
“You do your best job you can in launching something new like this, but by definition, it’s not perfect,” Perry says.
You have to look at what works and what doesn’t work and how you can improve the program to make it better.
“If it works, we figure out what does it take to scale this idea up and make it easy for consumers to use and adapt nationwide,” he says. “If it involves little training, we can roll it out very quickly. Consumers adopt things that are good for them very fast.”
In this particular case, it started in two cities in late 2009, and now it’s in 200 markets across the country, and there are now upward of 80,000 instant offers each month through the site.
“It was so popular that we pulled forward and accelerated the launch plan,” he says. “There’s an example of one that takes off. Then there’s other things that take longer or stumble.”
For example, AutoTrader.com has many customers with low credit ratings, but the company wants to be able to serve those people, so it has been working to help them find dealers that really serve that segment of the market. It’s a tool that Perry has had trouble finding the sweet spot that meets both the dealers’ needs as well as the customers’. But because it’s a great need in the market, the company will continue to refine it and make that process better.
Sometimes ideas just aren’t feasible at all. This was the case with auction-style listings AutoTrader.com did with eBay back around 2000. While it might be interesting to bid on a car online, what Perry and his team realized was that when you couldn’t see the car in person and inspect it and test drive it, consumers generally weren’t willing to pay more than wholesale.
“Most dealers are not interested in selling cars to the public for wholesale prices — they sell retail, that’s how they make money,” Perry says. “So if consumers only want to pay wholesale, why should (dealers) participate?”
When an idea works, it gets implemented into the plan, and the greatest thrill Perry has is being able to celebrate it and thank the person who suggested it.
“We present ourselves as an open-minded, flexible company that can change over time,” he says. “We can’t implement every idea tomorrow, but I can’t tell you how many hundreds of ideas our customers have given us, and it’s a lot of fun when you get a chance to call them up and say, ‘Remember that idea you gave us three or four months ago? It just went live on a national basis.’ That’s very exciting.”
How to reach: AutoTrader.com, (866) 288-6872 or www.autotrader.com
