Boat information site draws industry criticism
January 7, 2011
Filed under Market Outlook
CLEMMONS, N.C. — A new website modeled after the auto industry’s Edmunds.com is drawing widespread criticism from marine industry groups. The site, initially called paydealercost.com but recently renamed seedealercost.com, would provide product information about boats, powersports equipment and RVs.
The most controversial aspect of the site is the inclusion of dealer invoice pricing in addition to MSRP and product specifications. The invoice price does not include shipping from the manufacturer, dealer prep, taxes, title, license or other fees, and it does not reflect any wholesale incentives the manufacturer may be offering to the dealer.
In an interview with Boating Industry today, Marine Retailers Association of America President Phil Keeter said he has heard from about 25 boat builders who are opposed to the site, including Brunswick, Regal, Mirrocraft, Avalon, Tahoe, Glastron, Centurion, Premier, Regulator, Triton, Tiara Yachts, Pursuit, Marlow Yachts, Meridian, Chris Craft, Maverick, Moomba and Supra, as well as those brands represented by Irwin Jacobs (Larson, Seaswirl, FinCraft and Triumph Boats).
Keeter expressed concern that if the site goes live, consumers may use the information to exert downward pressure on profit margins at a time when the industry is beginning to recover from the recession.
“You can cite Edmunds.com all day long, but that’s a completely different animal than our industry,” Keeter said. “They smack everything possible into that dealer invoice. That’s not really what the dealer is paying.”
Keeter suggested that unlike the marine industry, automotive dealer invoice prices build in profit for the dealer. As a result, such a site has the potential to force a shift “in the way we go to market from the manufacturer to the dealer and the dealer to the consumer,” Keeter said.
A spokesman for seedealercost.com told Boating Industry the site is expected to go live in about five days. Both of the site’s representatives, former marine executives Jack Malone of Mercury and Dave Taylor of U.S. Marine, were unavailable for interviews at this time.
The goal of the site, according to a release announcing its upcoming launch, is to provide a clearinghouse of information for consumers researching a purchase. Leads generated will be offered to manufacturers and their dealers, and the site will sell advertising space to manufacturers, dealers and other companies.
“The retail environment has changed significantly over the past 15 years due to the Internet, where information on everything is available 24/7,” the release stated. “Consumer expectations have changed also, and consumers require total access to all the information they need to make an informed purchasing decision – before they go to the store or dealer.”
The release cited the recent marine industry research that shows more than 8 out of 10 new boat buyers have gathered information on the Internet prior to making a purchase decision, and most use the Internet to compare products and pricing.
“Unfortunately today, essential information must be gathered from a variety of sources, causing delays and frustration,” the release stated. “In addition, pricing for new products has varied greatly over the past few years due to auctions, repossessions, below invoice sales, etc., causing consumers to lose confidence in the pricing they do receive. We believe this is one of the main reasons why the sales cycle is so long and why potential consumers are continually lost to other activities. In most other industries, consumers can find out everything they need regarding product and pricing online – before they go to the store or dealer. The www.seedealercost.com website is being launched to make it easier for consumers to gather essential information, and to make it easier for consumers to make the decision to buy.”
Yamaha sent a letter to dealers Thursday reminding them that dealer pricing is considered “confidential information,” which they are not authorized to share. In fact, most dealer agreements state that dealers can’t disclose their costs, according to Keeter. Brunswick also sent a letter to dealers this week alerting them about the site and stating that they will not participate in or provide information to the site at this time.
This article has been modified since it first ran. The role of former marine executives Jack Malone and Dave Taylor was originally listed incorrectly.