Equip, Train & Adapt

The challenges, and opportunities, facing the F&I office are plenty. We saw evidence last year that consumers desire digital F&I presentation technologies, and that they’d like to see F&I’s transition to a more online experience accelerated. Of course, our industry is also dealing with intense regulatory scrutiny.

The evidence I referenced includes the slew of consumer studies conducted by Autotrader and its parent company Cox Automotive. They showed that consumers respond well to technology. Why? Because it allows F&I managers to more thoroughly and compellingly engage customers during their presentation. And hey, consumers who hear more and understand better tend to make the right decision more often than not.

Technology also helps get buyers through the F&I process faster. In fact, the use of electronic menu technology can shave 15 minutes or more off the typical 60-minute F&I experience. And as J.D. Power’s 2015 U.S. Sales Satisfaction Index Study noted, the absence of technology might be a deal breaker for consumers going forward.

“Dealers should understand that customers want and trust technology and that it can enhance efficiencies,” said Chris Sutton, the company’s vice president of the automotive retail practice. “Dealers that disregard it may risk being left behind in three to five years.”

Last summer, McKinsey & Co. published “What ‘Digital’ Really Means,” an aptly titled article that sought to redefine the term as “less a thing and more a way of doing things.” They further defined it by these attributes:

• Creating value at the new frontiers of the business world.
• Creating value in the processes that execute a vision of customer experiences.
• Building foundational capabilities that support the entire structure.

F&I technology helps you deliver a digital experience that accomplishes three goals:

• It streamlines and automates the assembly of customized F&I presentations.
• It engages customers’ full senses, drawing them deeper into product presentation and selection so they choose what they find useful and valuable.
• It holds F&I accountable to regulations pertaining to consumer lending and other matters, documenting the acceptance or declination of products offered.

In fact, consumers who use digital F&I technology to view and manipulate information, images, videos and surveys — on tablets, TV screens, digital pads or kiosks — report being more satisfied and more persuaded to buy.

Multigenerational Shift

Interestingly, consumers of all generations seem to respond positively to presentation technology, not just Millennials. Try to use digital F&I technology with confidence with every customer. Should you sense their discomfort with these tools, simply set them aside and turn to pencil and paper or your computer screen.

What we have found is that customers respond well to the following engagement tools:

• Emenu technology: The digital menu is the modern way to present products to customers. It speeds up and automates the process, which customers appreciate. A recently updated MaximTrak study of 270 Fiat Chrysler dealers showed that use of digital emenu software — compared to presentations not using a menu — lifted per-vehicle revenue by an average of 72% and vehicle service contract penetration by 51%.
• Self-guided presentations: Touchscreen technology, combined with interactive survey tools, helps consumers more quickly recognize the value of the products offered. These tools typically tout educational videos and interactive lifestyle surveys to help focus interest on the right products, resulting in improved penetration and margins.
• Compliance safeguards: You must be sure your staff is adept at using a compliance waiver that meets the standard of the Car Buyer’s Bill of Rights laws many states enforce. This technology should also document consumer choices, authorizations or declines, capture digital signatures and protect you from unfounded claims. Technology should also streamline compliance checks such as Office of Foreign Assets Control and Red Flags verifications as well as risk-based pricing and adverse action disclosures.

Great technology makes novices more proficient, but results excel when used by well-trained personnel. Invest in F&I training that not only focuses on applying technology but applying F&I basics to every deal.

This new era of customer engagement (and federal regulation) demands F&I be alert, discerning and fully capable. Consider these development guidelines:

• Plan for victory: Get all F&I staff marching in one direction. This can only happen when a staff knows the basics and can perform them consistently. Different people bring different experiences, habits and aptitudes to the job. Basic training is necessary to establish F&I best practices.
• Study the field: The F&I professional who steps out into the showroom to visit and chat with customers gathers important intelligence that helps him or her prepare more customer-specific presentations. Without this intelligence gathering, product presentations are generic and aimed at what is important to the F&I manager. This often results in F&I missing the main point: The only important products are those the customer wants and needs.
• Stay focused: Considering the overwhelming need for compliance and the enormous amount of paperwork the finance office handles, F&I managers have become administrators. They believe this part of the job is the most important, even more so than engaging the customer. Yet F&I staff is expected to sell more and generate more profit.

This pressure — along with consumers’ impatience during this last phase of the car-buying experience — can cause F&I to deliver a pushy, in-and-out presentation that shortchanges the customer and the dealership. That leads to customers declining products and the protections they offer, leading to reduced sales, commissions and revenue. Using an emenu system can help keep F&I focused and the process accountable.

Vehicle sales will remain strong in 2016 — up to 17.7 million units, according to projections — so make the most of this opportunity while it remains by keeping F&I skills sharp. Use interactive technology with buyers to help them better recognize how the products you sell help them protect their investments.

Jim Maxim Jr. is president of MaximTrak Technologies. Reach him by email at [email protected].