Mike Bowsher, owner of Carl Black Auto Group, knows there's plenty in a service customer's name.
Couple it with an address, submit it to a software tool such as VehicleXchange, and a dealer can get such data as the customer's credit score and, on that customer's auto loan, the balance due, interest rate and monthly payment.
That information enables Bowsher to prequalify service customers for credit. It tells him how much equity they have in their vehicles. It helps him create lists of new or used vehicles to offer those customers when they bring in their current vehicles for service. And ultimately, by jump-starting the financing process, it helps him sell more cars.
Bowsher began using an early version of the tool in 2013. In October, he switched to the current version under a pilot program with General Motors.
Once his staff got the hang of it, new- and used-vehicle sales across his four dealerships rose 700 to 800 vehicles per quarter, about a 25 percent increase, said Bowsher, who owns Buick, GMC and Chevrolet dealerships in Georgia, Tennessee and Florida. "It takes some training. But once we got it right, it took off and made a huge difference in our business."
He said he especially likes the tool because it enables him to determine equity in all service customers' vehicles, not just vehicles bought at his dealership.
VehicleXchange is a product of Pearl Technology Holdings, a Plano, Texas, automotive software company founded by Bruce Thompson. He partnered with Experian Automotive to provide consumers' credit score and auto loan information and with GM Financial to use that information to prequalify them for credit.
Through February "over 600" dealerships had signed up for the tool, Thompson said. Of that number, 250 were using it and "12 to 15" a day were being trained to use it.
A subscription to VehicleXchange costs $1,495 a month, plus $2.50 per customer targeted offer.
GM said it certified four providers of equity mining tools through its Dealer Technology Assistance Program, designed to help dealers choose software vendors.
"VehicleXchange is one of these providers. We have been piloting this technology with 30 dealers since last fall and the pilot concludes in March," GM said in a statement. GM said it also is using these equity mining tools: AutoAlert, RevenueRadar from DealerSocket and DealActivator from Dominion Dealer Solutions.
Dominic DeGuiseppe, director of the dealer channel at Experian, said the VehicleXchange tool takes a "little bit" of data and turns it into an opportunity for a customer to buy a vehicle, perhaps on the day of the service appointment.
He said the process includes "soft" credit inquiries, which have no effect on consumers' credit ratings. "Hard" inquires, which impact credit ratings, occur when consumers apply for credit.
GM Financial declined to comment.
Sonic Automotive Inc.'s Town and Country Toyota in Charlotte, N.C., began testing the tool in December, said Jeff Dyke, Sonic's executive vice president of operations. That's the store in which the group kicked off its One Sonic-One Experience initiative, which aims to improve the customer experience by combining tablet technology and limited price negotiations to reduce the amount of time to buy a car.
Dyke said it is too early to have meaningful feedback about the tool, but he has high hopes for it. If it delivers solid results, there is a "100 percent" chance that it will be rolled out to all of Sonic's stores, Dyke said.
Thompson said it works like this:
VehicleXchange sends names and addresses of service customers to Experian. Within minutes, Experian returns a list of customers that fit credit score tiers with which the dealer wants do business. For example, a tier A customer might have a credit score of 740 or higher, a tier B might have a credit score of 700 to 739, and so forth, Thompson said.
Experian sends data to the dealership only for consumers whose credit information fits the designated tier or tiers.
For applicable consumers, GM Financial creates individual prequalified loan amount offers.
VehicleXchange searches a dealership's new-vehicle inventory for vehicles whose calculated loan amounts -- sticker price, minus equity in a current vehicle, minus factory incentives -- is about the same as the prequalified loan amount offered by GM Financial.
The system packages that list in customized websites and sends details about how to access the relevant information to the customers via email and direct mail.
When consumers click on the sites, they can explore down payment and monthly payment options for the vehicles listed, and compare purchasing vs. leasing. The system also sends the consumers' names and contact information to the dealers' customer relationship management tool.
If a customer buys a vehicle, Thompson said, dealers have the option of financing the customer at GM Financial or choosing another lender.
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