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Upgrading to F&I 4G

February 2010, F&I and Showroom - Feature

by Ronald J. Reahard - Also by this author

Your sales and F&I departments are supposed to be on the same team. Unfortunately, you wouldn’t know it in many dealerships. That’s because there is virtually no communication between managers before, during or after a deal goes to F&I. To take sales and profits from “woe” to “WOW!” in 2010, the F&I department has to upgrade its level of service from 3G to 4G — the next generation of selling F&I products.

This upgrade requires F&I to become more than just a secretarial service for the sales team. It requires F&I managers to get involved early in the sales process and step up, not back, when there is a tough deal or difficult customer. They must view themselves as financial services specialists who genuinely believe in their products. Most of all, next-generation F&I managers must be teammates with the sales department, not adversaries.

Can You Hear Me Now?

The first generation of F&I began in the ’70s, when the F&I function first became a separate department. Back then, the F&I sales process was based on assumptive selling. Managers in this decade were simply required to include the products in the payment and hope the customer didn’t notice. If they did, they were to assume the sale. You might hear a F&I manager say something like, “It’s a standard contract feature that’s provided for your benefit.” If the customer objected, the F&I manager would defend the products, overcome the customer’s objection, and again assume the sale.

In the ’80s, complaints forced dealers to move to the second generation of F&I: step-selling. With this technique, customers were forced to endure multiple features/advantages/benefits presentations for F&I products they had expressed no interest in purchasing. Every customer heard the same memorized pitch. Objections were overcome with “logic traps” designed to get the customer to say “Yes,” as saying “No” would clearly indicate he or she was stupid.

The ’90s brought us F&I 3G, also known as menu selling. As penetrations declined and the need for F&I income increased, dealers began to expand their product offereings. Not only did the F&I menu allow for these additional products to be offered, but it also shortened the presentation time. Menu software providers created even more sophisticated programs that allowed managers to create and tailor packages to each customer’s needs. Unfortunately, many companies simply inserted a menu into their existing process and kept right on step-selling.

As we begin the new decade, it’s time to upgrade your department to F&I 4G, or what is called customer-centered selling. If you’re not truly trying to help every customer, you’re costing your store sales and F&I income. Preventing those losses is a shared responsibility for the sales manager, the Internet manager and, of course, the F&I manager.

Satisfied Customers Don’t Come Back

Focusing on customer satisfaction does not mean asking customers to check the “Completely Satisfied” box on their survey report, because doing so is like watching the scoreboard instead of the ball. Today, we can’t afford to have any customer walk out of the dealership — or the F&I office — saying to themselves, “Well, that was satisfying.” Remember, customer satisfaction is really the lowest rung on the ladder, as every customer should at least be satisfied with their purchase experience. But merely having satisfied customers doesn’t guarantee they’ll come back, or that they’ll refer your dealership to their friends.

I recently saw “The Blind Side,” a movie based on the true story of Michael Oher, a young man who, with the help of a caring woman and her family, overcame early traumas and homelessness to become an All-American college football player and first-round NFL draft pick. It was the kind of movie I just had to tell others about in the hopes they’d see it, too. The same goes for a dealership’s sales process: When an individual wants to call his or her friends to tell them to go see a movie, you know he or she were WOW!’d by the experience.

If you want to succeed in the competitive months ahead, you better be focused on WOW!ing customers, not on getting them to check the right box on some survey. Today, we need customers walking out of the dealership going, “WOW! That wasn’t what I was expecting! What a great place to buy a car! I have to tell everybody what a great experience I had at this dealership. They need to go buy a vehicle there, too!”

Changing the customer’s perception of the dealership’s sales and financial services process requires changing the experience. We have to WOW every customer in every dealership interaction, and a customer’s purchase experience begins with their initial contact. Whether that happens by phone, online or in person, the customer’s WOW factor is determined by the ease of navigating the dealership’s sales process, their experience in the finance office, vehicle delivery and follow-up efforts.

The ‘Mother’ Test

If you wouldn’t put your own mother through your dealership’s sales process, you need to change it. To WOW customers, you need to be easy to do business with. That means selling to customers the way they want to buy. Stop making customers wait while you load their information into the computer. Stop forcing customers to listen to memorized word-tracks and sales pitches for every product you offer. Stop making customers watch infomercials for products they have expressed no interest in, and stop using old-school manipulative sales techniques and self-serving processes.

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