Part-exchange profitability
All of our part-exchance valuations are calculated without the car being seen. It is therefore very important to get the right valuation - both for the business making profit, and the customer being happy with the price. These pieces of work aimed to assist in both directions.
Form assistance
Streamlining how we calculate valuations
As the valuation model we used to calculate part-exchange prices grew smarter, we wanted to make sure the tools customers used to get quotes matched this intelligence.
Solution
Given we were confidently leaning on our valuation model for prices, we wanted to streamline the number of questions that customers were asked about their car - but still maintaining customer trust that we were pricing their car fairly.
Design and delivery
We originally asked customers for data about their mileage, and the number of previous keepers the car had. With no restrictions on these questions, customers sometimes got them wrong - which had the negative impact of us buying the car for more than it was worth.
By running more checks in the background, we found we could help customers make less errors, by surfacing things like the mileage at their last MOT.
We therefore ran a number of experiments around the inputs on the form - restricting the data which customers could enter, whilst still attempting to give customers the control they need to feel happy part-exchanging with us.
Over time, our valuation model was trained to estimate condition, which was an area that our user research had highlighted was the hardest section of our form to fill in correctly. Many users were frustrated by this step, and therefore lacked the confidence to go ahead with the part-exchange.
We therefore experimented with how we might use this estimated condition to guide customers into the right choice on the form, whilst still leaving them feeling like they were in control.
Outcomes
These changes were proven to have made an impact on the accuracy of our valuations - we could see this through the data we received back from auction prices. Overall, profits from part-exchanges rose whilst having no negative impact on part-exchange conversion - which was exactly what we had aimed for.
Valuation guarantee
Reassuring customers and minimising re-quotes
Data analysis showed us that the length of time customers spent considering their purchase ran for an average of around 5-10 days - but we only guaranteed our part-exchange quotes for 24 hours
Solution
We sought to guarantee part-exchange valuations for a longer period of time, to line up with customer consideration periods, and to reduce customers "re-quoting".
Design and delivery
This seems like a simple change, but lots of exploratory work went into it. Analysis was done on how much value a part-ex might be likely to lose over a set number of days, and the difference was deemed minimal.
At the same time, we spoke to customers to see how a guarantee message should be communicated, and ended up with being able to present a "4-day price guarantee" for all part-ex quotes. This meant that rather than being throw-away, our quote screen became something that customers could come back to while considering their purchase.
Outcomes
We saw a significant decrease in customers running multiple quotes - we hypothesise that this is because they feel their quote is much more locked in, and don't want to lose it.
