Advertisers, Start Your Engines
We may be about to find out just how rambunctious American car culture can get on the Net. On Feb. 27, Edmunds.com, one of the leading sites for car buyers, is formally launching CarSpace.com. It's a bid to apply the social networking model of MySpace.com (NWS ) to folks who tune, race, and obsess over cars. This is no marginal digital media play -- drop a dipstick into this plan, and it looks pretty smart.
Social networks differ from older networking roundabouts such as America Online (TWX ) chat rooms and Yahoo!'s (YHOO ) member groups by bringing chats, home pages, photos, and file-sharing into one big garage with an easy interface. When you log onto CarSpace, you know the people inside are there to chat and post about chrome rims, the new Bimmer at the auto show, or to help you find a trusted mechanic in Butte, Mont. So you can upload those jpegs of your tricked-out Scion xB, bash controversial BMW chief designer Chris Bangle, and search the profiles for your dream date: "must love NASCAR, cigs, and CSI."
Right now this kind of interactivity -- on sites such as Edmunds' public forums, Yahoo! Autos, and Cars.com -- is highly fragmented and only marginally entertaining. So consolidating all things auto onto one branded site could be a service. It's easy to see why the company, which is keeping mum about specifics until the launch, has high hopes. MySpace gets some 36 million visitors a month and was the eighth-largest site for traffic in January, according to Media Metrix. But the smallish space for users to mix it up about cars doesn't get much traction at a site originally geared to music-file sharing.
EDMUNDS.COM, MEANWHILE, IS UP to 9 million visitors a month, while its year-old offshoot, InsideLine.com, about tuner and performance cars, draws more than 2 million visitors a month. Both sites' capacity for ads is maxed out. Media planners say CarSpace could even pass Edmunds.com's main site for traffic in two years if it gets buzz. "Self-generated content creation and networking are now clearly one of the biggest media growth stories," says Curt Hecht, chief digital officer at GM Planworks, General Motors' (GM ) media agency.
Here's where it gets interesting for advertisers. They could play a key role in building awareness of CarSpace via their ads in TV and newspapers as well as on their own sites. GM is already sending consumers to Edmunds and Google (GOOG ) to check out its new pricing strategy. They'll also buy ads on the site itself. Honda (HMC ) has signed up to be an inaugural advertiser, and GM is close to a deal.
GM is finding it can be better to send folks to a third party such as CarSpace rather than to its own site. GM might want, for instance, to show a new car design or an exclusive, Cadillac-sponsored Aerosmith video. On CarSpace this would have less of a scent of commercialism, though GM's ads and links would be nearby.
Advertisers also like the way social networking can target people by passion rather than age. Look for Web pages by NASCAR drivers, car-loving celebs such as Jay Leno, and auto execs -- perhaps Ford (F ) CEO Bill Ford. GM's Hecht thinks CarSpace could be an answer to a problem he's been chasing for three years: how to pull together millions of people on thousands of car-enthusiast sites not reached by ad servers into a network he can talk to.
Here's a possible piece of the plan, I'm told: CarSpace could invite all those sites, clubs, message boards, and car communities in cyberspace -- from the Houston Volkswagen Club to the St. Louis Biodiesel Club -- to put their sites inside CarSpace. And, like Google, Edmunds might eventually share ad revenue with those groups for coming into its ad-supported tent.
About 60 million Americans a year buy a new or used car. Among young, first-time buyers on sites such as MySpace, 35% consider the Net their most important shopping tool, says auto researcher R.L. Polk, vs. 8.2% who cite TV and 4.4% who pick magazines. If CarSpace can make its garage a sticky place for car nuts to hang out, the business could be a sweet ride.
Jon Fine returns next week. For David Kiley's blog, go to businessweek.com/the_thread/brandnewday/index.html
By David Kiley