I never really liked blogging and cursed the day I’d have to pen my own blog. I always viewed blogs as a way for someone with too much time on their hands to play reporter. But like Jim Ziegler said during his “Technology-Enabled Sales and Marketing” workshop at the 2009 NADA Conference and Expo: “Nothing is going to stay the way it was.”

So here’s my entrance into the blogosphere. Let me kick this off with a question: What’s your vision of the F&I office of the future? Will it even exist?

I ask this because I walked away from several conversations at the 2009 NADA Conference with a blurry vision of our future.

Listen, I think the F&I office is safe in the near-term. Heck, today’s credit crisis is proof enough of that. However, it’s also shined a light on a dealer’s need for cash flow and the need for dealerships to do more with less. That’s why, if you’ve been paying attention, there’s been some movement on the e-contracting front. (Click here to see what I mean.)

But here’s the deal: The need for cash flow also has automakers, lenders, and technology providers revisiting the age-old vision of a hybrid front-end. Only this time their vision doesn’t involve an F&I kiosk.

No, this time that vision involves an iPhone-wielding consumer using his or her wireless device to fly through the car-buying process with just a few clicks. In fact, that very scenario was described during a panel discussion at the American Financial Services Association’s 2009 Vehicle Finance Conference in New Orleans.

If you’re laughing at that possibility, here are five examples of why you shouldn’t:

Example 1: Hyundai’s Payment Assurance Program

Listen to how EFG Companies’ Jeff Beaver and Ricky Wolfe described the company’s WALKAWAY program, the payment assurance product that became a viral advertising sensation for Hyundai.

“The reason why we ever even began this venture was to enhance the value proposition of EFG Companies,” said Wolfe. “We’re a performance-enhancement company and we’ve made this transition from being F&I-only to differentiate us from the other companies like ours.”

Wolfe added: “We thought we needed to play sideline to sideline, so we made some strategic moves in terms of buying a CRM company, buying the licensing to Walkaway CANADA, which we thought at the time was a tremendous lead-generation tool. That’s the way we’ve seen it all along.”

Even companies advising lenders are saying payment assurance products shouldn’t be viewed as traditional credit insurance. Click here to check out this white paper from Computer Services Corporation (CSC), a technology solutions provider that works with lenders.

My take is this: WALKAWAY is a hybrid product. I mean, the 12-month, vehicle-return program Hyundai threw on the hoods of every financed or leased vehicle sure does sound like a sales generator. But the upgrades the program offers — full-term coverage, additional coverage for other out-of-work circumstances, and up to $15,000 in negative equity coverage — sure makes it sounds like a great upsell in the F&I office.

Example 2: Open Dealer Exchange

Not sure if you caught the announcement, but ADP and Reynolds are looking to bring a complete loan origination solution to the market under a new moniker — Open Dealer Exchange.

Pretty neat, right? Well, as I heard from Marty Zowan, a sales executive for ODE, the solution could, if a dealer wanted to, put the financing process right in the sales area.

Example 3: DealerTrack’s New Vision

Now don’t misunderstand me, as DealerTrack execs didn’t say the company was out of the F&I business. But the company did lay out a new four-quadrant view — compliance, DMS, sales, and inventory management — that didn’t include the letters “F” or “I.”

And listen to this quote from DT’s Mark O’Neil: “DealerTrack has historically been identified as a credit provider. The reality is today we’re a different company.”

As I said, DT isn’t forgetting about its roots. It’s just redefining itself to better reflect the moves it’s made in recent years.

Example 4: Allstate Credit Division Now Allstate Dealer Services

DT isn’t the only company making moves to more accurately reflect its operations. Allstate is doing the same thing. And listen to this quote from Allstate Dealer Services’ Tony Wanderon:

“The name Allstate Dealer Services reflects the transformation our business has undergone in recent years.”

Listen, I know this hybrid front-end picture has been painted before. The difference this time around is we’ve just been hit by an unprecedented crisis that’s making everyone rethink their business. Where that puts F&I, I’m not sure. All I say is we better be part of that evolution.

Look at me, I never really was a fan of blogs or bloggers, but here I am today.

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Gregory Arroyo
Gregory Arroyo

Gregory Arroyo

Gregory Arroyo is the former editorial director of Bobit Business Media's Dealer Group.

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Gregory Arroyo is the former editorial director of Bobit Business Media's Dealer Group.

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