Tag: F&I

Improving F&I Processes to Meet Changing Customer Expectations

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66% of car shoppers are more likely to buy from a dealership with their preferred experience, but less than 1% of car buyers like the current car buying process, according to Autotrader’s Car Buyer of the Future Study. To give customers their preferred experience, dealerships must meet the changing expectations of today’s car buyers.

To create a desirable customer experience, dealers need to create real value for customers while also striving to speed up the F&I process. In a recent Automotive News webinar, Jason Barrie, Vice President and General Manager of Dealertrack F&I, Dealer, teamed up with Kevin Cook, General Manager of Straub Automotive, to talk to adjust the F&I process to streamline workflow and create value for customers.

Kevin knows firsthand how improving customer experience can boost bottom line. When Straub Automotive noticed their customers’ expectations shifting, they decided to switch to a new technology solution that would enable an improved customer experience: Dealertrack eMenu for iPad®.

“Our goal was to take the fear out of F&I,” Kevin said.

Though many dealerships like Straub Automotive see customers approaching F&I with fear, customers still value making a deal in person. In fact, 89% of customers want to sign their final documents at the dealership, according to the Cox Automotive Future of Digital Retailing study. The problem is that F&I has traditionally been a very paper-based activity, which runs counter to the preferences of most internet-savvy customers.

Before switching to Dealertrack eMenu for iPad®, Straub Automotive used non-interactive video tool to aid in the F&I presentation process. With eMenu for iPad®, the dealership was able to shift to a more digital, interactive and personal F&I experience, and F&I profitability quickly increased.

“We introduced the process to the customer and immediately saw about a $150 lift in F&I profitability per car sale, and we knew we were onto something,” Kevin said.

Over the past two years, Straub Automotive has put the eMenu for iPad® mobile technology at the core of their F&I process, reaching 100% utilization by sales and F&I staff. This has resulted in up to 60% penetration on GAP Insurance and an average of $400 additional profit per deal. With one of their dealerships, Cook and his team had initially thought that a 40-50% penetration for service contracts was a good goal, but today they are seeing 75-80%.

To learn more about how to adjust your F&I processes to improve profitability, visit go.dealertrack.com/4ways, and listen to Jason and Kevin’s Automotive News webinar.

Moving F&I Online

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Car buyer preferences are shifting toward more online research, and 83% of consumers today want to complete at least one automotive purchase activity online, according to the Cox Automotive 2017 Future of Digital Retail study.

As dealers move toward a digitized customer lifecycle that encompasses advertising, purchasing, servicing and financing, customers expect a seamless transition from online to in-store.

The F&I process is ripe for digitization. When customers have the option to begin to structure their deal online, their satisfaction increases, along with the dealership’s revenue and profits.

A recent Cox Automotive and PwC survey found that 63% of dealers saw the biggest ROI from digitizing their sales and F&I process.

Learn more about bringing F&I into the digital world in this F&I and Showroom article by Cheryl Miller, Vice President and General Manager of Dealertrack F&I Solutions.

The Consultative Approach to Selling

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by Mo Zahabi

While digital retailing in automotive is on the rise, dealership staff still play an important role in customers’ car-buying experiences. Six in 10 consumers would still want help from dealership staff even if they could purchase online, according to the Cox Automotive Future of Digital Retail Study.

But the roles of the salesperson and F&I manager have changed. In the past, dealership staff were only there to make money off a customer. Oftentimes, the customer knew more the vehicle than the salesperson. Today’s dealership staff, on the other hand, have responded to customer needs and shifted to a much more product-oriented approach. According to the same Digital Retail Study, today’s car buyers prefer staff who are product specialists – people who are highly knowledgeable about features and technology who will also act as consultants and listen to their needs in a low-pressure environment.

This consultative approach is particularly important in F&I, where consumers are critical of the traditional pitch, according to the 2015 Digital F&I Experience study. To connect with your customers – and make the sale – you have to take a more personal, friendly approach to F&I selling.

Empower Independent Learning

In the old approach to selling, there was a one-way flow of product information: the salesperson would tell the customer information as they sat in front of them. It was a belly-to-belly, in-your-face approach. But today’s consumers are hungry for resources that allow them to do their own research. 71% of car shoppers would prefer to do F&I research at home prior to purchase, and 63% say they would be more likely to purchase F&I products if they had the option to learn about them before finalizing their vehicle purchase, according to the Cox Automotive Maintenance & Repair Study.

Consider offering F&I product information on your dealership website, and also give your customers opportunities to do their own research once they are in your store. Mobile menu selling solutions, like Dealertrack’s eMenu for iPad®, enable independent customer learning. These technologies allow you to load a tablet with key F&I product and payment info, giving customers the opportunity to digitally explore your F&I offerings on their own – and better understand the value of F&I products.

Sit Shoulder to Shoulder

Most people use the phrase “shoulder-to-shoulder selling” figuratively, and that imagery is important when thinking about your approach. Customers need to know you’re not selling at them, but consulting with them. But the literal sense of the phrase is important too.

Literally sitting shoulder to shoulder with your customer as you review F&I product information can change the entire mood of the presentation. Without the physical barrier of the desk, the “me vs. you” mentality that can leave customers feeling intimidated in the F&I office is removed. Consider implementing menu selling technology that is specifically developed for tablets like Dealertrack’s eMenu for iPad®, which enables you to sit shoulder-to-shoulder with your customers – figuratively and literally.

Leverage Your Network

Today’s customers know there are many options for everything they can buy, and they want to know that they’re getting the best option available. Make sure you’re familiar with the network of aftermarket providers powering your dealership’s F&I selling solution, and don’t be afraid to explain to your customers where your product offerings are coming from. They’ll appreciate the transparency, and an increased understanding of how the process works certainly won’t hurt your chances of making a sale.

A version of this post originally appeared in Digital Dealer.

Watch this video to learn more about how Dealertrack’s eMenu for iPad can help you implement a more consultative approach to F&I selling.

Mo Zahabi is the Senior Director of Product Consulting at VinSolutions and Dealertrack F&I, where he educates dealers on best practices and ensures their offerings exceed industry expectations. Mo has applied his strong foundation in technology-based applications to the automotive industry for the last 18 years. Prior to joining VinSolutions in 2008, Mo was a respected Internet Director and eCommerce Director for two different automotive groups.

Success Story: Straub Automotive

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Superior customer experience is at the core of West Virginia dealer group Straub Automotive. In fact, the four-store group boasts high CSI scores, multiple Honda President’s Awards and two Nissan Awards of Excellence. So as customer expectations began to change, Straub Automotive knew their processes had to change with them.

One area of customer experience the dealership knew could use improvements was the F&I menu presentation. Straub had been using an aftermarket product presentation video that wasn’t integrated with the menu presentation, leaving customers with a slow, unengaging experience.

To improve efficiency for the F&I team and improve customer experience, Straub Automotive turned to Dealertrack eMenu for iPad®.

Almost immediately after implementing the new mobile technology in the dealership, F&I profitability rose: an average of $150 in additional F&I profit per deal. Watch the video below to hear more about Straub’s success using this mobile menu selling technology.

Watch Straub Automotive’s success story.

Want to learn more about how to align your F&I processes with customer expectations? Join Straub Automotive’s Kevin Cook and Dealertrack’s Jason Barrie for a FREE webinar on the topic. Register here!

Titles and the Need for Speed

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Customers are continuing to spend less time at a dealership from beginning to end. According to the 2018 Cox Automotive Car Buyer Journey Study, car buyers spend 60 percent of their time online. They want to come in with the dealership already aware of what they want, close the deal and wrap up all subsequent paperwork as quickly as possible.

Dealerships have made great advances to make this a reality. However, there is still one piece of a deal that is out of the hands of both the customer and the dealer — the acceptance of payoff and the release of the title for a vehicle that is traded in.

Our data shows that the traditional payoff and title release process for trade-ins can average anywhere from 12 to 18 days or more, because each lender sets its own process. Without that title in hand, the dealer risks selling a vehicle that may not belong to him or her yet.

And this process includes many time-consuming tasks: lengthy hold times with lenders waiting to verify payoff amounts, hand writing checks that are then overnighted for delivery, more phone calls and hold times with lenders to address short pays or to track the status of a title after payment was mailed, and so on. Dealerships often need more than one clerk just to manage these details.

And, as all this is taking place, the car is sitting on the dealership lot, not being sold — just occupying space. Dealers spend on average $32 per day for each car that sits on their lot, according to a 2016 Manheim Online Dealer Community survey. Multiply that $32 by the average number of days your trade-in waits for title, then multiply that by the average number of trades you take in per month. That total loss quickly adds up; it’s not unheard of to be tens of thousands of dollars per year, or higher.

Full lienholder details can be viewed before initiating payoff — eliminating the guessing game of what may appear on the title to unwind the deal — and payment as well as title status can be tracked 24/7, eliminating the need for follow-up calls by staff. This streamlined process virtually ends the short pays, lienholder surprises, check writing, phone calls and spreadsheets/log books that plague the traditional manual process. This fully electronic process also gives complete transparency to dealers as well as lenders while also creating consistency. This is fast becoming the new industry standard — a standard that is easy and efficient for dealers, lenders and customers.

What does this mean for dealers? First, inventory may be moved more quickly. Second, staff can spend less time dealing with payoff calls, title tracking and bookkeeping, which frees up their time to make more sales and better serve the dealership and its customers. This process helps the dealership save a significant amount of time and money and, in turn, improve its bottom line. Ultimately, the dealership is more productive and profitable.

Dealers have known for a long time that the title release process is time consuming and outdated. It’s time to accelerate and modernize this process the same way the rest of the dealership and car-buying processes have been updated.

Discover how Dealertrack Accelerated Title can help your dealership close more deals and get more customers on the road faster and more efficiently.

A version of this post originally appeared in AutoSuccess.

CBA Live: The Time for eContracting is Now

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Andy Mayers, Dealertrack Lender Solutions strategist, recently participated in a panel discussion at retail banking industry event CBA Live. The conversation focused on dealer motivations, eContracting, operational efficiencies and internal dealer issues.

From the discussion, we heard common observations about the future of dealerships and how they need to adapt to the consumer’s desire to enjoy a better experience purchasing a car. However, the common takeaway was to meet today’s customer expectations, the role and purpose of F&I needs to change. One way dealers can adapt is with digital contracting, but there are several factors a dealer should keep in mind when considering making the move.

For insights on these factors, as well as key characteristics of today’s car shoppers, read Andy’s full recap of the panel discussion in Digital Dealer.