To reduce the push and pull around F&I product options and avoid surprising consumers with unexpectedly higher monthly payments as F&I products are added on, dealerships should introduce F&I online.
Monthly payment cost is on the top of consumers’ minds when buying or leasing a vehicle, according to Jason Barrie, senior director of market performance at Dealertrack Technologies.
Consumers expect immediate results. Every solution is a click away with a smartphone or tablet, and auto financing and insurance offers should follow suit. Is more online integration what’s next for the F&I world? Maybe it should be.
With the average loan term stretching and leases rising, it’s evident that consumers are eyeing low monthly payments.
And they want an idea of that monthly payment cost and F&I product options before they visit the dealership, Barrie said.
Consumers spend an average of seven minutes on a Dealertrack vehicle building and pricing page they access through dealership websites. On the page, consumers can build a vehicle, look at interest rate and adjust terms to get to a monthly payment that meets his or her budget.
“You think about seven minutes,” Barrie said. “That’s a very high number, and if you talk to most website providers or consumers or dealers, that’s a lot of time they’re spending on a full dealership website, let alone one specific vehicle.”
Making financing applications available online pays off. On average, nearly 30 percent of dealerships’ online financing applications lead to sales conversions, Dealertrack co-president Raj Sundaram told Automotive News.
It reduces time spent in the F&I office, and consumers are better prepared when they visit the dealership, he said.
Consumers are also asking for an F&I product preview before stepping into the office.
MakeMyDeal’s 2015 Finance and Insurance Study found that 83 percent of surveyed consumers were interested in learning about F&I before they visit the dealership. A third of consumers find the list of F&I product choices confusing. Just under half could not identify the correct vehicle service contract definition, and just more than half could not identify the correct prepaid planned maintenance definition.
Consumers are showing that they want to be prepared and educated car buyers. Dealerships should give them the resources they need.