Editor's note: An earlier version of this story had an incorrect title for MakeMyDeal founder Mike Burgiss.
TAMPA -- Dealerships could be losing out on F&I sales because of their traditional reluctance to introduce products to vehicle shoppers before they come into the store to purchase a vehicle, a new study commissioned by a Cox Automotive offshoot finds.
For decades the selling of F&I products has been conducted almost exclusively in-store, said Mike Burgiss, founder of MakeMyDeal, a Cox Automotive-owned company that sells software that allows shoppers to negotiate online with dealers the prices of vehicles and trade-in values they’ll accept.
But the new study by MakeMyDeal indicates that consumers want to learn about F&I products online before getting to the store. And if they could, they would be more willing to look at them seriously from a distance rather than in-store, where they say they are skeptical of the information because it is being introduced at the end of a long buying process, Burgiss said.
“F&I is one of the biggest parts of the buying process that has still not moved into the digital age,” Burgiss said.
The findings are from a study of 500 randomly selected car buyers and car shoppers in September 2014.
F&I products include extended service contracts, prepaid maintenance plans, key-loss replacement and tire-and-wheel repair policies.
The study found that 61 percent of respondents believe F&I products are just a way for the dealership to make more money. About 48 percent said they would never buy anything other than the car from a dealership. More than half said they just want to complete the vehicle purchase and leave as quickly as possible.
That doesn’t mean they aren’t interested in F&I products, though, said Burgiss, who was interviewed on the sidelines of the 18th Digital Dealer Conference & Exposition here.
The study found that 83 percent of car shoppers would be interested in learning more about F&I products but before they get to the store. Burgiss says that interest isn’t translating into as many sales as they could because the car buyers don’t want to feel rushed in F&I.
The study found that 84 percent of survey respondents believe F&I products may have value and 66 percent indicate that they believe F&I products could save them money in the long run.
“However, our study shows that the current F&I process breeds consumer skepticism,” Burgiss said. “By changing when and how the shopper is introduced to F&I products, dealers could see a dramatic change in consumers’ likelihood to buy F&I products.”
