Five ways to enhance customers finance experience

Inflation is starting to bite for us all. I want to share some thoughts on how dealers can adapt to the changes this might mean for F&I in managing customers. Today’s typical customer is often a Millennial or even Gen Z. Until the last six months, they had no experience of inflation or rising interest rates. When it came to finance, access to finance was easy.

Much has changed, and if the economists are correct, there is more change ahead, including a greater focus on affordability by lenders, which is entirely realistic given the trends in inflation.

With this in mind, here are five ways to enhance customers’ F&I experiences from my experience in the showroom, as a customer and as someone old enough to have experienced inflation and rising interest rates.

1. Coach your Sales Team – it isn’t just customers for whom the current economic backdrop is a shock; it will also be team members. Set up a coaching session, ideally with someone who has been through it, to help them appreciate the implications of rising inflation/interest rates. The goal should be helping to manage customer expectations.
2. Walk in the shoes of customers – a challenging economic backdrop often makes access to loans more difficult. It is something that was seen at the outset of the Covid-19 pandemic. Recent news headlines about banks reigning in access to credit in areas such as cutting access to overdrafts have been appearing. The increase in Bank of England Base Rate will mean higher interest rates for many. Beyond this, some people will find it harder to get a loan acceptance, or that acceptance may come at the cost of higher interest rates. Dealer finance is not immune from this trend, but as history shows, at MotoNovo, we continue to lend and find ways of saying yes in challenging times.
3. Be obsessive about transparency – I love the notion of ‘hidden in plain sight when it comes to F&I. Absolute integrity and transparency are about selling yourself as a person and selling trust and can work wonders. People buying products and services they know with all the detail is a perfect and highly attractive approach.
4. Be ready for people trading down – it seems inevitable that some customers will be seeking to reduce their outgoings, and the car will be one area of potential cost saving. Bear this in mind in your stock mix and marketing and be ready to manage such opportunities.
5. Reach out to existing customers – let your existing customers know that you can be flexible and imaginative in helping customers in these changes times. While some people are aware of the possibility of trading down; don’t take such knowledge for granted, consider being proactive.

I hope these prove useful.

Richard Irving, Head of Field Sales