Based on 1,000+ dealer-only conversations across franchise and independent rooftops in CDG Circles.

Big picture: Dealers are navigating a dynamic market marked by continued variability in sales performance, with February proving inconsistent across the board and March showing mixed early signals. Operational shifts include significant investment in and transition between DMS/CRM systems, alongside the adoption of AI-powered tools for customer engagement. Rising costs from traditional advertising platforms like CarGurus are prompting reevaluation and reallocation of marketing budgets, with self-managed Google VLAs showing strong ROI for some. OEM mandates, such as GM's separate website requirement, are adding new layers of cost and complexity. Consequently, operators are prioritizing disciplined execution, in-house solutions for used vehicle acquisition, and optimizing service-to-sales conversions to drive profitability and adapt to evolving industry demands.

DMS & CRM Transitions Present Challenges and Opportunities: One dealer reported saving approximately $2,500 per month by switching from CDK (DMS/CRM, printers, network, phones, payroll) to Tekion DMS/CRM only and engaging third-party providers for other services. A multi-store group was quoted $18,000 per rooftop, per month, for a full Tekion package at their larger stores.

Tekion's data migration limits DSDA data to 7 years. Another multi-store group experienced significant implementation challenges with Tekion DMS/CRM over six weeks, noting slow DMS performance and a less effective service tool compared to their previous VIN system. DriveCentric was noted as potentially costing an additional $3,000 per month compared to DealerSocket. VIN Solutions was described as "falling behind" and its AI, "Vinessa," as "rudimentary and not worth the add-on." Gubagoo's new CRM is anticipated "later this year" and is expected to be "DMS Agnostic."

AI-Powered Engagement Tools Show Promise but Require Management: Skaivision, an AI text engagement tool for service departments, reported strong early customer engagement, with one dealer noting its $1,200-per-month cost could be covered by "1 acquisition a month."

Podium's AI chat was noted for "better conversations" and "making appointments AND following up for Google review follow-up and requests" compared to Matador. An AI phone service (ScaleVoice), used across 28 stores, showed "not great reporting" and "not great conversion" for sales calls. Some rural dealers expressed a preference for human interaction over AI phone services like PamAi.

Inventory & Photography Tools Enhance Efficiency: Dealers are exploring alternatives to vAuto, which one single-point new car store pays "around $3,000+" for. VinCue was cited as "significantly cheaper" and available at "$2,400 per rooftop with no add-ons." Impel's "Virtual Photo Booth" was highlighted for making vehicle photography "so easy," and "Tru Images" for new inventory was described as a "must have" and "cheap" option. "Car Cutter" was also recommended as an "awesome" and "not expensive" photography tool.

Copier Machine Vendor Decisions: Dealers are seeking recommendations for copier machine vendors as contracts expire. Xerox was mentioned as a national option. Some dealers opted to "ditch the vendor" and purchase Kyocera or Brother printers/copiers, finding toner and parts "cheap."

Google Ads (VLAs) Offer High ROI When Managed Actively: One dealer reported impressive ROI from self-managed Google VLAs in February, with weekly spend of "$28.75," leads costing "$5 each," and sales costing "$19 each." Another dealer, based on the same raw data, calculated a monthly spend of "$862.50," leads at "$37.50 each," and sales at "$143.75 each," still considering these "great #s for Google Ads ROI."

OEM Digital Requirements Drive Increased Costs: GM's mandate for separate Chevrolet and Buick/GMC websites is creating operational friction for dual-franchise stores. Dealers report concerns about doubling website expenses, estimated between "$1500-3000" depending on the package, in addition to increased costs for chat providers, digital marketing budgets, and SEO spend. The deadline for this separation is understood to be "by the end of the quarter" to receive EBE money.

Third-Party Listing Site Costs Prompt Reevaluation: Dealers are experiencing "crazy" price increases from CarGurus, with one reporting a jump from "$4000 a month" to an initial request of "$10,000," then "$7,500" after negotiation. A dealer-reported strategy involves canceling when prices rise significantly, waiting them out, and then re-signing at previous or similar rates, with one dealer paying "$700 for Cargurus at the moment."

Social Media Management Platforms Streamline Efforts: One group transitioned from Hootsuite and Podium to BirdEye for managing social media and reputation across "13+ rooftops," finding it consolidated platforms and "reduced budget." Agorapulse was noted as a "fine" option and "quite a bit less $$" than Sprout Social. LocalShift is being explored for Facebook Marketplace listings.

Building In-House Buying Centers for Inventory Control: Given the "brutal" conditions at wholesale auctions, developing robust in-house vehicle acquisition centers is a key focus. One independent dealer successfully built a buy center consistently acquiring "100+ cars per month" with the guidance of a consultant, reporting a cost of "$5000 per month" for this guidance. The dealer noted readiness to "fly on our own after a year" with the consultant.

Automated Pricing Adjustments & Third-Party Site Alerts: When a vehicle's price drops by "1%" on Autotrader, it triggers customer notifications. Similar thresholds exist for CarGurus at "1.5%" and Cars.com at "1%." One dealer automated used car pricing to adjust "1% every 7 days," with a "1.5% every third week" to trigger CarGurus alerts, reporting it "worked out pretty well."

Vauto Profit Time Alignment: A dealer questioned the success of 100% vAuto Profit Time alignment, reporting their "used car operations have not improved at all" despite running "about 80 percent alignment."

Proactive Service-to-Sales Strategies Drive Conversions: One store successfully "flipped 7 clients from service to sales for the month of February" by having their BDC reach out for complimentary equity analysis based on Xtime data. Another dealer implements an automated "Loyalty Upgrade offer" tied to "every RO" before BDC follow-up and asks for referrals via text, noting resulting showroom visits.

In a very affluent area (Darien, CT), X3s are being financed up to "60 months at .9%" and 0% internally, targeting clients "over mileage before lease maturity."

Optimizing Service Processes and Training: Dealers are using maintenance packages such as "buy 2 and get 3rd free" for oil changes and rotations, selling them in service and finance, with package prices varying by vehicle type (basic synthetic, luxury, or diesel). MPI videos are a key focus, with techs doing their own and requiring "above 95%."

Advisors are paid on videos sent, with a "90%" minimum for bonus. Service managers are expected to T/O "any unsold tires or brakes that are Red." Advisors may discount "10% on their own" as long as the discount for parts and labor doesn't go over 5% of their gross for the month." Hiring a "dedicated person" to film all MPI videos "failed every time because they wanted to move to an advisor role." Dealers are considering "Dealers Edge" for service manager and SA training.

Vehicle Addendums Drive Profitability: Addendums like theft systems, interior/exterior protection, Xpel, and tint average "1.5 addendums per deal in used and 1.3 in new." Ceramic coating and windscreen coverage (windscreens costing "$3k+" to replace/recalibrate) achieve a "60% take rate" when on addendum. Paint and fabric protection and electronic screen protection yield a "40-50% take rate."

CSI Incentives Under Review: A Lexus dealer is considering changing service consultant incentives from CSI-based to spiffs for Google reviews, noting that their team's "98%" CSI score was only slightly below the district's "98.12%."

Wins & Warnings

Pro & Exec members: Your 6 Wins & Warnings are below.

Dealers praise lean Google VLA spend and CRM simplicity, while sounding alarms on CarGurus price hikes, Tekion implementation costs, and VIN Solutions falling behind on innovation.

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