CarMax embraces AI to boost sales and efficiency, with focus on 'generative engine optimization'
For the quarter that ended May 31, CarMax reported $7.55 billion in revenue, up 6.1% from the same quarter a year ago.
Goochland-based used car giant CarMax Inc. says it is increasingly focused on rolling out AI technology across its operations to boost sales, marketing and efficiencies.
On an earnings call last week, CarMax CEO Bill Nash said his company is putting a particular emphasis on 'generative engine optimization,' or how it makes its content and listings easily understood and leveraged by AI-powered search engines. Companies have long focused on search engine optimization, which determines how high up web content appears in search results on sites like Google.
'I think the big new buzzword is GEO instead of SEO,' Nash said. 'That's what it's all about. It's like how do you show up well. It's critical. I think if you're only focused on SEO, you're going to miss the boat.'
He said GEO will play a big role in CarMax's future marketing campaigns — including one launching this summer — and he said when it comes to marketing in general, he sees a lot of potential with generative AI.
CarMax recently parted ways with Richmond's Martin Agency as its advertising agency of record, opting instead for L.A.-based 72andSunny.
CarMax execs also said the company is seeing gains in efficiency and user experience through its deployment of AI technology across its operations. The company said it has recently seen a 30% improvement in its containment rate — or how much of a total task is successfully managed without needing to escalate to a higher level or require further intervention — through the use of Skye, its AI-power virtual assistant. AI tools have also improved the productivity of its customer experience teams and its phone and web response times, the execs said.
'We see tremendous opportunity to continue expanding AI applications across our business to drive both the top line growth and operational excellence,' CFO Enrique Mayor-Mora said on the earnings call.
For the quarter that ended May 31, CarMax reported $7.55 billion in revenue, up 6.1% from the same quarter a year ago. It posted $210.4 million in net income, up 38% year over year.
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