Competitive financing available: Do your customers know?

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Every customer knows that that they can get competitive financing from your dealership, right?

Wrong! Over 30 percent of marine dealerships do not offer financing (always for very bad reasons – but customers only know from them that dealerships do not offer financing). There is also a common assumption among shoppers that they will almost always get a better deal if they arrange their own financing.

If you want your store to be an F&I superstore, you have to begin by making sure that everyone looking at your website and walking into your store knows that you offer competitive financing and that you make it very convenient and easy. One more thing -- you have to let your shoppers know that you want their business!

Where are the places that you should be advertising your finance capabilities?

  • Above the fold on your website home page with a clearly articulated "Easy Finance – Competitive Rates" message
  • Prominent on your home page with an "Easy Pre-Approval" capability
  • On your home page and/or on a linked page – "Fast and convenient financing at Bank Rates"
  • Every vehicle detail page should offer "Get Pre-Approved"
  • Signs and banners in your store saying "Easy Competitive Financing Available"
  • Every boat sign needs to reference "Competitive Financing Available"
  • Your Finance capabilities need to be part of your Facebook page

You can't assume that customers know what you can do for them! You only be sure that they know what you have told them – repeatedly!

You may want to consider offering customers an incentive to finance with you. You might offer a $25 gift card, pro-shop credit, service credit – something that you know your local lenders will not be offering and that lets your buyers know that you are serious about earning their finance business. You can, if you want, build this incentive into your documentation fee and so have your customer pay for the incentive.

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There are a couple of big "Don'ts" in delivering your message:

  • Never advertise rates
  • Do not guarantee financing – financing is based on the customer's credit profile, not your desire to provide it

Your website is frequently the first point of contact with your customers. Two big mistakes dealers make on their websites are to understate their finance capabilities by either not mentioning them or by burying the messages, or they use their online credit application as their finance advertising and lead capture form.

While there is a lot of value in having in having an online credit application available in a private location for customers who have decided to finance, having a generally available credit application for unsolicited completion as a way to capture customer information is flawed.

Surveys show that less than 20 percent of consumers are comfortable providing all of the information required. Statistics show that 80 percent of people who complete an online application unsolicited are simply trying to see what they might qualify for – and they picked you to tell them, with no loyalty to your store. Moreover, the vast majority of these "no reason" completers have credit scores of 670 or below. You are saddled with all of the obligations associated with having received a credit application while ending up with less than 4 percent being qualified buyers – and those may well not buy at your store.

Soft credit pull pre-approval is widely available. By obtaining only name, address, phone and email – no social security number or date of birth – you should obtain a real time credit score (verify that it is real time) and enough credit profile information to determine just what financing a consumer will qualify for. With this soft pull, if the customer does not meet predefined criteria, you don't even need to tell them that anything happened. In no case is the customer's credit impacted. Providing this option on your site gives customers the ability to fill out a very simple form for the promise of easy financing and statistically will substantially increase finance leads.

Here are the core takeaways:

  • Customers don't automatically know that you can offer convenient, competitive financing – you have to tell them
  • As the first point of contact, your website must convey your finance capabilities early, often and in a variety of ways
  • Your online credit application is neither finance advertising or a lead capture form
  • Physical signs in your store must reinforce your message
  • Make sure your customer knows that you want their business

Tell your buyers what you can do and don't assume they know – your bottom line will show the difference.

Myril Shaw is the COO of First Approval Source where he leads a team dedicated to ensuring F&I excellence at dealerships. Myril been a champion of profit and success for over 30 years.

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