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Huh or hey?
Huh or hey?
Last year, Volkswagen Group launched its very own multi-brand online used car portal, heycar, where around 310,000 cars are currently waiting for a new owner.
Markus Kröger, CEO of heycar
heycar is aiming to do things differently. This is the message behind the new ad for Volkswagen’s used car portal currently appearing on TV and, of course, on YouTube too. A voice asks: “Hey, do you prefer browsing for used cars like this?” A picture of a man with a magnifying glass appears. “Or like this?” We see a young man on a sofa with a laptop, looking relieved and excited as he tests out the simple heycar website. Then cars from a few different brands appear. “Good-as-new cars – and hey, they’re all still under warranty.” Quick and clear. It’s hey, hey, heycar.
And anyway: heycar has to do things differently. With a volume of EUR 80 billion per year, the used vehicle market is very tough. At the moment, the world of online portals in Germany is dominated by two big names that are unavoidable for both sellers and buyers. Anyone looking to get rid of their old car currently has to list it on one of these sites or, ideally, on both of them. And any customer looking for a wide range of used cars to choose from will find it on one of these portals. Around 90 percent of all sales that take place via online portals go through these pages. Competitors have to think outside of the box if they want to attract sellers and buyers on this market.
Different than most competitors
heycar is different – so says Markus Kröger, CEO of the portal. Different for buyers, different for sellers, different for car manufacturers. That’s three things at once – is that even possible? “Of course it’s possible!” says Markus Kröger. “Our approach is completely different to most of our competitors.” It starts with the business model: heycar isn’t a listing site, it’s a brokering site. “We don’t make any money when a seller lists their cars on our platform,” says Kröger. “We make money when a seller signs a sales agreement with a buyer who has found the car on our platform.” This is how heycar earns commission.
heycar boss Markus Kröger at a meeting in a Berlin car dealership.
“We therefore have a real interest in making sure that cars are sold.” heycar sees itself as a broker who brings together sellers and buyers – and then politely finds out whether they hit it off and whether they agreed on a sale.
A genuine alternative
Some 1,000 retail groups with around 3,000 locations have now signed up to the portal. “heycar offers a genuine alternative to the listing portals,” says Markus Kröger. After all, sellers don’t have to worry about the costs unless they manage to sell a car. At the moment, heycar sees itself more as an extra than as an alternative. However, the aim of the site is to offer sellers so many benefits that they no longer have to list on the other portals, or at least not on all of them, explains the CEO.
A hand on the dipstick: the engine compartment undergoes a thorough check.
Reliability and transparency
heycar only lists vehicles with a warranty. “All of our cars have been thoroughly checked, have passed their MOT and still have a warranty,” says Kröger. “That’s why we get all sellers who want to list cars on our site to sign a declaration.” One of the ‘rules’ on heycar is that every car must have less than 150,000 kilometers on the clock and must be less than eight years old. The thinking behind this is to protect buyers from any nasty surprises. heycar hopes to attract customers with reliability and transparency, not because of the sheer size of its range. Kröger predicts that the number of vehicles on the portal will grow to a maximum of 700,000. The site currently lists 310,000 – and that’s just one year after its launch. Potential buyers can search for their dream car according to various categories, and then only receive offers for “family cars” or “city cars”. “Our goal is to find out exactly what a potential buyer is looking for and then find them the perfect match,” says Kröger. “The customer is at the heart of everything we do.”
Customers want diversity
The used vehicle platform is a subsidiary of Volkswagen Financial Services. This means that heycar is also able to offer financial services. “Our financing calculator allows us to draw up highly accurate sample financing packages for cars from the Volkswagen Group,” says Kröger. Customers can use heycar to request a credit check and then sort out the financing directly with the seller if everything is in order. Over the long term, heycar is planning to offer this as an online service – buying and financing all in the same place.
Even though it is part of the Volkswagen family, heycar takes a clear multi-brand approach. “Buyers want to be able to compare cars,“ says CEO Kröger. “Even if a customer has already decided on a specific brand, they still want to see what alternatives are out there – even if it’s just to assure them that they’ve made the right choice.” Nevertheless, only 40 percent of all buyers set out to buy a certain brand when they start looking. “Most customers are completely open-minded,” explains Kröger.
“We’re onto something great,” believes heycar CEO Kröger.
Multiple brands and multiple shareholders
heycar is leaving the door open for other car manufacturers to purchase a stake in the portal. “After all, we’re all facing the same problem. Our dealerships all want a good and quick solution for selling our used vehicles,” says Kröger. In September, Daimler announced its plans to purchase a 20 percent share in heycar “to support the further development of this multi-brand platform”. Daimler hopes that the portal will soon be able to offer sales, financing and insurance all from a single source. “We are delighted with the investment,” says heycar boss Kröger. “It confirms that we’re onto a good thing.”
