It’s not a new concept: a website that allows consumers to post photos of damage to their vehicles and take bids from body shops that compete for the job. And some body shops previously balked at the idea because the company wanted a 15 percent cut of the estimate. But Internet entrepreneur Brad Weisberg says his company, BodyShopBids.com, has come up with a new business model that he claims is the wave of the future and has gained traction in the Chicago market.
Big money is behind the site, with Groupon co-founders Brad Keywell and Eric Lefkofsky as investors, and Weisberg says early success has led to an invitation by a venture capital firm in California to possibly raise a second round of seed money.
But can the site really work for body shops? With hundreds of shops and consumers already signed up, Weisberg says that he has seen proof that it can.
"A shop might not make as much money on these online customers as it would on someone who walks in the door off the street," says Weisberg, "but if you show them great customer service and do quality work and deliver on time and make them happy, they won’t use our website next time – they’ll come directly to you and refer all their family and friends to you."
Through some of his cold calls, Weisberg has heard his share of "get out of towns" from shops. "But the other 30, 40 or 50 percent don’t think twice about it. It’s the owner’s son or daughter who’s taking over the shop and understands that, at some point, technology is going to come into this and yes, you can give estimates online through photos and yes, there are new and unique ways to drive customers to your shop."
Only Quality Shops Need Apply
Weisberg says he’s not looking to get every shop in the country signed up on the site – only tech-savvy shops that are interested in expanding their business and tapping into Generation Y (although there are consumers who have used the site that are aged 40 or older, too). The reason is because his No. 1 priority is to give the consumer a great experience, which he believes is tantamount to making the website work.
"I understand most people find their shop through word of mouth, so if I’m running a body shop lead generation company, I’m going to have to understand that people are going to hear about me through word of mouth. So if those people have a great experience on my site, they’ll tell everyone they know."
With that in mind, the site claims it only partners with quality shops. The "Our Shops" section of the site reads, "BodyShopBids will never pass you along to any old body shop! We only do business with shops that we would be willing to send our grandmothers to." He claims that every shop selected is first visited and pre-screened by the BodyShopBids certification team.
A Different Kind of Customer
Weisberg admits the online customer is different than the typical customer, and he has to educate shops on this difference.
"As online leads, these people need to be treated differently," says Weisberg. "They need to be given estimates in a timely manner, or you will lose them. These are Generation Y people who are all over the Internet and that’s how they do their shopping and find shops and read reviews of shops and do all these things their parents don’t do. I don’t think body shops realize how important some of these sites like Yelp! where consumers can review shops are. There are people reading about these shops online trying to figure out if they can trust them. People are very conscious about how they go about finding their shop."
The typical shop that has signed up so far, Weisberg says, is an independent, mom-and-pop shop that is not part of the DRP game and is looking for unique ways to bring in more business. He claims most shops "haven’t batted an eye" when told about the 10 to 15 percent the site takes for itself off the estimate.
"In order for this to work, I have to be able to send shops quite a bit of business so that they’re happy with a steady flow of work and whatever margin they’re able to make," he said. "At the same time, I have to be able to make money because I have to figure out a way to get leads through my site.
Educating the Consumer
Weisberg feels his site plays a big role in educating the consumer.
"Price, quality, used parts, OE parts…the average consumer has no idea what any of this means. What we’re here to do is educate the consumer so they understand their choices," said Weisberg.
An example, Weisberg said, would be to explain to a consumer that the reason there is such a big difference in price between two estimates for a bumper is that one is taking into account refinishing the bumper.
"We urge shops on our site to give a very detailed description of exactly what they’re going to do, and then we’re in touch with the customer to let them know this is why this estimate is one price and this one is another," said Weisberg. "And then it’s up to the consumer to make that choice.
"The whole point is that the consumer needs to understand everything. The reason the collision industry is looked at the way it is is because it’s not transparent and no one educates consumers, and when they do it’s confusing and not average-person friendly."
Another perk of the site for the consumer, says Weisberg, is the ability to book and also pay for the job via the site. Everything is handled for the customer, and if there are any problems whatsoever, the website will handle them.
Weisberg says the average estimate price so far has been between $1,000 and $2,000. He would like to expand into large collision damage one day but realizes that photos don’t necessarly work for that. Still, he won’t rule out innovating as he goes to possibly overcome that hurdle in the future.
He claims that it takes 1/10th of the time for a shop to process the estimate as it would when someone walks in off the street – because his company sends the shop an e-mail with three to four clear photos of the damage with a description of the damage plus information such as VIN number, make/model of vehicle, etc.
Cheapest Price?
For shops who feel they do not want customers who are constantly searching for the cheapest price, Weisberg says his data shows the choices consumers are making on his site aren’t always based on price.
"They do more research than that," he says. "They look up the shop, read reviews of the shop on our site, and choose by the shop’s proximity to them, price and what the shop offers as far as warranties, etc. Shops have to understand that the economy is tough and everyone is shopping around."
Weisberg says that the toughest part of his job so far has been convincing body shops that they need to change the way they market. But he believes once they experience success through his site, the tide will turn.
"We’re here to help them and work with them, but they also have to work with us and adapt to a changing world and a changing consumer."
More information:
