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PURLs of Wisdom

ChannelNet’s Paula Tompkins once toyed around with kiosks designed to take customers through a dealership’s entire sales process. Now she’s using personalized URLs to help captive finance companies realize the bigger role they play in helping dealers move the metal.

April 2014, F&I and Showroom - Cover Story

by Gregory Arroyo - Also by this author

Paula Tompkins has a few thoughts about the dealership experience. Her opinions might offend even the most progressive dealers. As an inventor who holds two patents for a software platform designed to create personal websites and self-service portals, she believes the industry needs to let go of the past and give consumers the control they desire. But she saves her biggest criticism for the F&I office.

“The F&I process really needs a lot of work,” Tompkins says. “From a consumer perspective, it’s extremely time-consuming, and that’s the rub. The challenge is the process and the way it works today is so engrained in dealership personnel.”

Tompkins says she has experimented with F&I menu selling on iPads at the point of sale, but acknowledges the pressures are sometimes too great for dealers to figure out when and how to use technology. That’s why her firm is working with captive finance companies to automate their customer-retention efforts and certain elements of the vehicle sales transaction.

“The dealer has certain goals he wants to accomplish in the F&I office, so speed becomes a critical factor,” she says. “But solutions are coming. It’s exciting, and it’s just a matter of how do we really make this work and successful?”

Tompkins isn’t some new-age tech geek; she’s a Baby Boomer who recently celebrated her 60th birthday. Nor is she an industry outsider, having studied and served the automotive industry since founding her Dearborn, Mich.-based firm in 1985. The company opened under the SoftAd Group name to take advantage of the growing use of personal computers. It was renamed ChannelNet in 2004 after transitioning toward web-based customer acquisition and retention solutions.

“I came out of the Silicon Valley area, where I worked for General Electric [in the late ’70s] and its engineering groups to bring all these personal computers [and] luggable computers into the marketplace,” Tompkins says. “I quickly realized that these technologies were going to allow us to do things beyond spreadsheets, word processing and data manipulation.”

Strategy Alignment
Longtime industry veterans may remember some of ChannelNet’s earliest work. In the mid-’80s, Tompkins worked with Ford and General Motors’ Buick division to develop showroom kiosks designed to take customers through the sales process without the help of dealership personnel. “That was the wrong approach,” she admits. “Once the customer gets in the showroom, you still need that human interaction and the dynamics that go on there to move the customer through the process. It’s critical.”

ChannelNet’s mission of leveraging technology to drive sales, increase revenue and strengthen customer relationships hasn’t changed, but its toolkit has. “We used whatever means we could, whether it was a salesperson using a laptop, whether it was a 5 ¼- or 3 ½-inch diskette that was sent to the customer in the mail,” she says. “The Internet and mobile has supercharged all that.”

Last month marked the 25th anniversary of the birth of the World Wide Web, which was invented by Tim Berners-Lee, a British scientist. ChannelNet had already been toying with digital marketing campaigns for BMW, GM, JPMorgan Chase and Ford. Then, in 1995, the firm launched Ford.com and the world’s first dealer websites for the OEM’s 5,000 dealers at the time.

Technology and the strategies of ChannelNet’s core automotive customers, including BMW Financial Services, Volkswagen Credit, Audi Financial Services, Hyundai Motor Finance, Kia Motors Finance, and Southeast Toyota, began to align in 2005. Customer retention became a key focus, with captives realizing the critical role they could play beyond financing vehicle purchases.

“They were ready to start adopting these new techniques,” Tompkins says. “They started to think beyond the old way of doing things and saying, ‘OK, what are the new ways we can do things that enable our customers, retain our customers and help us acquire new customers?’”

The new way, at least for ChannelNet, was developed in 1999 and patented in 2010 and 2011. It was an Internet-based software platform for building personalized customer microsites. Today, the platform is creating personalized URLs, or PURLs, to help captives deliver what Tompkins refers to as “targeted lifecycle communications.”

“The old saying is, ‘It is eight times cheaper to sell an existing customer another vehicle than to conquest a new one,’” Tompkins notes. “And this is where the industry really has a lot of trouble, because, remember, all the money goes into new-car sales. But then the brand has to wait until the customer is ready to purchase again. So if we can communicate with them across the ownership lifecycle through the financing company and bring all these various tools and capabilities to them, it makes it so much easier to get them into their next new vehicle.”

A New Cadence
Once a vehicle is sold and financed by one of ChannelNet’s captive customers, they receive a welcome email with a link to their PURL. At a minimum, the vehicle owner can use the microsite to make their monthly payment, but Tompkins says there’s a lot more a captive can do.

“Not many people buy two new cars on the same day, so it’s important that you start what we call a cadence of communicating relevant information,” she says.

Scott Fink, a Florida dealer and head of Hyundai’s dealer council, was impressed the first time he saw ChannelNet’s personalized URLs in February 2010. He says the microsites have had a positive impact on his dealership’s lease-return process.
Scott Fink, a Florida dealer and head of Hyundai’s dealer council, was impressed the first time he saw ChannelNet’s personalized URLs in February 2010. He says the microsites have had a positive impact on his dealership’s lease-return process.
BMW Financial Services won several awards after implementing ChannelNet’s PURLs in 2006. Ally Auto took things a step further by allowing dealers to populate the sites with pictures of customers with their new vehicle. The sites also included contact information for the salesperson the customer worked with. They also encouraged customers to schedule their first service appointment.

The sites can also be used to cross-sell other products and services, including credit cards and even F&I products such as GAP and service contracts. “The first 90 days of every customer relationship is when a customer is most receptive to cross-selling opportunities,” Tompkins notes.

ChannelNet’s PURLs are especially effective with lease customers, allowing captives to automate communications with customers at critical points during their lease term. Tompkins says captives can set up the sites to recommend that lease customers conduct a self-inspection of a vehicle 70 days from the end of their lease. At lease-end, the site will tell customers what forms they need to bring with them to the dealership.

There’s even a mileage calculator to help consumers stay within their mileage limits. One captive is even allowing consumers to use their credit card rewards to purchase additional mileage. Hyundai Motor Finance’s PURLs display a graphic meter at the top of the webpage so consumers can track how many days are left on their lease. Below that are three icons consumers can click on to upgrade to a new vehicle, purchase the vehicle they’re leasing or return their vehicle.

The sites can even be loaded with videos, incentive offers and more. Dealers can also load service and sales specials. “We get data from the captive on the dealer of record, and the solution is free to the dealer,” Tompkins says.

Hyundai’s and Kia’s captive finance companies connected with ChannelNet in the summer of 2009. Tim Devine, senior vice president of Hyundai Capital America, admits his organization wasn’t the most cutting-edge company at that time. Its consumer site wasn’t user-friendly and the company didn’t have a dealer portal. All communications, he says, were either done by mail or fax.

“What Paula brought to us initially was our dealer portal,” he says. “We wanted a one-stop place for our dealers to do business with us. And when Paula brought the dealer portal to us, she goes, ‘By the way, I’ve got this cool thing called PURLs, which is a cool way to communicate with your customers.’

Paula Tompkins began her career on Wall Street in 1974. She arrived in California’s Silicon Valley in the late ‘70s before starting her firm in 1985.
Paula Tompkins began her career on Wall Street in 1974. She arrived in California’s Silicon Valley in the late ‘70s before starting her firm in 1985.

“It was email communications at its finest, and we almost immediately saw that the open rate on our PURLs was above 40%.”

With 14,000-plus leases set to expire this year, Devine’s team began pushing out a campaign in late 2013 to get lessees into a new Hyundai. “We actually stick to a pretty regular cadence of PURLs that go out, so we try to pick the right times to communicate with customers versus spamming them,” he says. “And again, the PURL strategies help us be a bit more laser-like than a shotgun. We can send out 1,500 different versions of the same email to 1,500 consumers.”

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