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The Cobalt Group Drives a New Web Deal

Written By: A. Turner
Published On: January 20 2000

Event Summary

On Monday, January 10th, the National Automobile Dealers Association (NADA) and The Cobalt Group, Inc. (Nasdaq:CBLT), announced plans for the development of an automotive portal and packages to help automobile dealers create websites.

Cobalt, a provider of Internet solutions for the automotive industry will offer NADA dealers two different NADA-endorsed web packages for use in building their own web sites.

  • The NADA Web Essential Package provides fundamental web development and business management tools for dealers to establish dynamic e-commerce sites. Features include web site development and hosting, e-mail forms, automated new and used vehicle inventory listing capabilities, traffic reporting and links to OEM and NADA resources. The price is $350 for the initial set up and $349 per month thereafter.

  • The NADA Web Premier Package builds on the Essentials by adding features such as advertisement management, lead management, a services solution and a parts locator service. Pricing for this package is a $500 initial set up fee and $599 a month thereafter.

Another component of the NADA-Cobalt initiative is an automotive portal that will allow consumers to search an online inventory of new cars, trucks and used vehicles. The site will also provide online shoppers with an enhanced dealer locator, consumer advice and access to the consumer edition of the N.A.D.A. Official Used Car Guide.

Market Impact

This is a significant announcement for the Cobalt Group. The new partnership provides access to NADA's nearly 20,000 franchised dealers which hold nearly 40,000 separate franchises. Cobalt maintains relationships with 16 automotive manufacturers and over 50 of the largest dealer groups in the United States. They have little or no competition in the dealer website market.

While automotive sites such as Edmunds, or Kelly Blue Book, help users identify prices and compare products, they do not connect the customer with their local dealer or provide inventory information. With only minimal competition on the local level, Cobalt has the opportunity to corner the automotive dealer web site market. We believe they could be involved with 85 percent of all North American NADA dealer web sites.

Both web packages will be showcased at the annual NADA conference in Florida later this month. When the portal launches in April, it is estimated consumers will be able to access more than 550,000 new and used vehicles listed by Cobalt's dealer customers and direct links to thousands of dealer Web sites.

User Recommendations

For the dealer, this is advantageous as NADA has endorsed a web resource and helped define two offerings. This is beneficial for organizations who may not have a web initiative underway. Conversely, dealers with existing web sites and matching platforms may integrate Cobalt's functionality.

For the automobile consumer this is great news. Many dealers use the NADA Official Used Car Guide as the standard for establishing the trade in value of used vehicles. Previously it was very difficult to obtain a consumer version. Having the resource on-line will level the playing field between dealers and consumers. Access to the same information the industry uses will help consumers effectively negotiate, and having a portal that provides pricing and the option to check availability of a local dealer will save time and empower consumers.

Whether you are in the medical services industry, equipment rental business, or some other form of association, this is a picture of things to come. Industry associations are natural movers in creating vertical consumer and business to business websites. Look for web related programs and partnerships to arrive in your areas soon.

 
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