Driving To New Markets Miles Ahead Of The Competition
Today, CARFAX is a widely recognized brand, known as much (or more) for its beloved cartoon CAR FOX mascot than for its fax-based origins. Since creating their Vehicle History Report™ in 1986, the company has transformed into a digital-first organization and is now the leading source of vehicle history information in North America. Every day, millions of people confidently shop for, buy, service and sell cars with innovative solutions powered by CARFAX vehicle history information.
- 1M+ users on the CARFAX Used Car Listings app
- 500K+ downloads of the CARFAX Car Care app
- 28B vehicle history records
- More than 139,000 data sources
CARFAX’s core business model is to build the most comprehensive data set about every vehicle on the road to help consumers in every stage of the ownership lifecycle, and provide revenue generating services to auto dealerships and service centers.
A key driver for their growth and success has been their ability to shift gears to meet evolving customer and market demands. And for more than a decade, 3Pillar Global has been riding shotgun as the product development partner that innovates digital solutions for CARFAX users, not only developing new products but making existing products even better.
“I don’t make recommendations lightly. You have full-stack capabilities and provide us great advice.”
– Aaron Hall, Director of Product Services, CARFAX
Challenge
Diversifying to Fuel New Revenue Engines
Following the wide adoption of their vehicle history reports by car-buying consumers, CARFAX wanted to build on their success by diversifying revenue streams and expanding into other markets. That meant identifying organizations that could benefit from access to reliable vehicle information and delivering it on a platform that meets their specific business needs.
Those needs vary based on the specific use cases for vehicle data and the “job to be done” for different users. For consumer mobile apps, CARFAX is continually innovating to improve user engagement, or “stickiness,” and increase their ratings in the app stores. For business users, they’re looking to provide vehicle data quickly and without friction in a way that supports the way they work and earn revenue.
Solution
Uncovering New Opportunities to Solve Customer Needs with Data
To help them identify new ways of monetizing their vehicle data—and expand into the business-to-business (B2B) market—CARFAX engaged with 3Pillar to observe potential customers as they went about their day-to-day work. This first-hand observation enabled user experience (UX) researchers to uncover insights about customer needs, including when, where and how they use vehicle data and how digital products can most effectively meet those needs.
Opportunity #1: Dealerships
CARFAX identified automobile dealerships as a key growth opportunity, but to break into this new market they needed a compelling value proposition to win over skeptics. That’s because the CARFAX Vehicle History Reports for consumers made it easier for car buyers to buy directly from sellers, without relying on dealers to facilitate their purchase. Sometimes, that even meant dealers were competing with direct consumers at used car auctions, which frequently cost them a potential sale or forced them to reduce the sales price.
But what if CARFAX could use that same data to help dealers make smarter decisions when buying used cars?
To find out, we visited a dealership and observed with the goal of identifying opportunities. When one of their used car buyers went to bid on cars at an auction, 3Pillar’s user experience (UX) researcher asked to ride along.
While at the auction, our researcher was stunned by how little time the buyer got with any of the vehicles and how little specific information they had about the cars they were bidding on. Based on this observation, 3Pillar recommended that CARFAX develop a mobile application that could scan a vehicle identification number (VIN) and immediately provide available details about that particular vehicle, including the make, model and year, as well as suggest a wholesale bidding price with supporting logic.
The value to the dealership was twofold:
- Dealerships could make more informed decisions on the cars they bid on.
- They would no longer be surprised to find out what was lurking in the CARFAX Vehicle Report at sale.
Today, thousands of auto dealers nationwide subscribe to the CARFAX Dealer Solutions Portal, which features an entire arsenal of dealer tools. In fact, their dealer business has now surpassed the success of their B2C business.
Opportunity #2: Police Accident Reports
CARFAX saw another new revenue opportunity in the public sector, where they could provide law enforcement with a standardized digital application to collect and share accident reports—a time-consuming, paper-based task.
CARFAX for Police is a mobile/web app that streamlines the process of filing accident reports. To ensure adoption of the digital product, 3Pillar did ride-alongs with officers in the field to understand and optimize their process. As one researcher remembers, “They would literally stack papers on the dashboard of the vehicle to complete the reports.”
After surfacing patterns, priorities, and pain points, our experts presented low-fidelity sketches and high-fidelity digital wireframes for feedback and testing. We then iterated on a more efficient, reliable way to collect accident information from anywhere and created an innovative, modular data model that accommodated different needs and workflows by state. “This was a textbook example of why you talk to users and get inside their heads to understand how they handle the information,” says Michael Rabjohns, 3Pillar Global Director and Head of User Experience.
Taking advantage of smartphone connectivity and scanning capability, CARFAX for Police enables officers to capture data and file it with the state reporting authority at the scene of the accident.
- CARFAX is reducing report completion times by about 50% and integrating more robust data across their systems.
- Better onsite reporting from law enforcement means better core data and better data monetization.
Opportunity #3: Loss Valuation Reports for Insurance Claims
When a vehicle is involved in an accident, insurance claims come into play. For example, when a vehicle is “totaled,” the insurance company has to determine the car’s fair market value prior to the crash, which is what they pay out to the policyholder.
Using the CARFAX Total Loss Valuation app and robust data set, claims adjusters can evaluate the vehicle’s value faster and more accurately. It was also important that the app was intuitive and easy to use and that it provided a clear, compelling report, so policyholders could feel confident the assessed value and payout were fair. These two factors enabled insurers to close claims transactions more quickly and improve productivity.
But the benefits didn’t end there. Data from the CARFAX Used Car Listings make it easy for car owners who have experienced a total loss — an emotional experience — to find very similar used cars available to buy in their local market.
Outcome
Partnering on Product Development to Drive Revenue Growth
These new products join a growing portfolio of products that 3Pillar has helped CARFAX to develop over our decade-long partnership, with their B2B market now accounting for an even larger share of business than consumer products do. Most importantly, our work together has fostered a deep understanding of CARFAX customers, which now informs their entire new product development process.
Each new digital product enables CARFAX to further expand and enrich their data—creating a virtuous cycle as the data becomes ever more valuable and adds even more opportunities for monetization and revenue growth.
See how we helped CARFAX increase user engagement and app store ratings for their car maintenance and used car listing mobile apps.
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Like CARFAX, your company’s data has value. See how 3Pillar Global can help you extract new value from that data to grow revenue, boost market share, and increase customer engagement.