Auto Trader has confirmed it is aiming to introduce its new price indicator labels to adverts before the end of March this year.
This will see adverts labelled as having a Good Price, Great Price or Priced Low in comparison to similar cars. The Priced Low label indicates that a vehicle is priced “significantly lower than the market average”.
There are no plans to introduce a Bad Price label, Auto Trader said.
The Price Indicator functionality has been live with dealers through Auto Trader’s Dealer Portal, Retail Check and i-Control since late last year but the plan is to launch it to consumers “before the end of Q1 or early Q2”.
Karolina Edwards-Smajda, Auto Trader retailer and consumer product director, told AM: “It was important for us to make sure dealers can get used to this new system before we officially launch it to consumers.
“We have already had a lot of feedback from dealers and we know we need to get the extra specification on vehicles correct and taken into account on price labelling before we can launch.”
Edwards-Smajda said making sure all added value options are taken into account is the only way to be fair about comparing vehicles on price like-for-like.
The decision to introduce price labels came following Auto Trader’s own research which showed 76% of car buyers think price transparency is the most important factor in their purchase decision.
Auto Trader determines the price label for each car based on make, model, derivative, age, mileage and any optional extras on the car. This data is combined from over 500,000 trade used car listings each day.
Price Indicator won’t work retroactively for previously uploaded stock and is partly reliant on dealers uploading any new stock with the correct boxes ticked for details about the car, including the extra spec it has.
Auto Trader is also pulling in the spec-adjusted data from details within a vehicle’s advert automatically to help improve accuracy with its pricing algorithm.
Edwards-Smadja said: “We’re encouraging dealers to go through the process to make the price labels as accurate as possible.
“I think there is also an opportunity in the future to add the ability for consumers to search for specific optional extras or a certain level of options in their results.
“We can already see that when consumers are searching for stock but as they are using the customer keywords on the advanced search to find vehicles with specific options like sat nav.”
Edwards-Smadja said Auto Trader is also taking steps to make sure optional extras are more visible on adverts.
Stock that don’t feature a label will be because Auto Trader doesn’t have enough data around optional extras to provide an accurate price indicator but this is expected to change as more data is collected.
Cars under £1,500, over £50,000, nearly new cars under six months with less than 300 miles, Cat C/D cars, imports and private listings won’t feature the Price Indicator labels.