Online Extra: Q&A with Toyota's Keith St. Clair

The exec discusses the challenges of working with dealers to put up an expanded car-buying site quite different from the company's rivals

Toyota (TM ) was one of the first major auto manufacturers to launch a car-buying site that pools inventory from several dealers, giving buyers a bigger selection than they would find on an independent site. Similar to the new site GM (GM ) is testing with Autobytel (ABTL ), Toyota's offering,, was launched in the Seattle/Tacoma area in April, 2000. It was so successful that the company has since expanded it to six other cities. Keith St. Clair, a Toyota manager who spearheaded the new site, talked about Toyota's online experience in a recent discussion with BusinessWeek Los Angeles Correspondent Arlene Weintraub. Following are edited excerpts from their conversation:

Q: How did Toyota come up with the idea to offer a site that would pool inventory from several of your dealers?


The idea was sparked by some of our dealer groups. They asked us to do something leading-edge to embrace the online consumer. When we launched the first site, there were various degrees of expectations. We considered it a big lab experiment.

Q: How has the response been so far?


The number we look at most closely is what percentage of site visitors submit a lead that dealers can use to make a sale. Typically, car sites only generate 1% or 2% trackable leads. We're landing 4%. That's a good indicator, but we'd like to see more. So we're working hard on improving the design of the site and figuring out other ways to improve the number of leads.

Q: What about working with an independent site, as GM chose to do in its test with Autobytel?


We've been invited to work with third parties, but we feel we can create the most value for consumers by working with our dealers instead. I'm not sure it's in our best interest to endorse a third party.

Q: Dealers have traditionally had a tenuous relationship with car manufacturers. As you roll this out city by city, how much of a challenge has it been to convince your dealers to participate in


We have found some resistance. That's typical with anything that's still in its infancy. Dealers are used to being the primary source of information for car buyers, so not every dealer is as excited as the next.

Q: With over a year's experience with, can you assess the future of this new online car-buying model?


The whole power of this is the ability to get the customer the right car as quickly as possible. We have taken a cautious approach to rolling this out, and we're still evaluating it, but it appears to be a win-win.

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