MIDLAND, Mich. -- Technology, customer retention and insurance plans were on students’ minds during the first F&I Innovator of the Year competition co-sponsored by Northwood University and EFG Cos.
“[Students] were very advanced in their thinking in terms of [smartphone] apps,” said Fernando Somoza, executive manager of Central Automotive Group and one of the competition’s judges.
Many products also tied sales to service to keep customers coming back to the dealership. “Retention is the name of the game,” and the students grasped that, Somoza said.
Eighteen students were divided into six teams of three, and each team worked with a dealership F&I mentor for one hour a week. Five teams finished the competition.
The teams, in their final presentations to the judges, showed the practicality of their F&I product in the marketplace and its potential for commercial sales in franchised dealerships.
The semesterlong competition came to a close last week when Team Quantum Integration was named the winner. The team’s three members walked away with a $25,000 prize, and a product they invented will soon to hit the market, with Northwood, in Midland, Mich., receiving a cut of the revenue. EFG, in Irving, Texas, expects to have the product on the market in one year.
The product, called Watchdog, sends vehicle security alerts and maintenance updates to a smartphone app. The app also enables consumers to start their vehicles remotely.
“What do we have attached to us 24/7? Our phones,” Richard Durso, a sophomore team member on Quantum Integration, told Automotive News while waiting for the award ceremony to begin here last week. “We wanted to incorporate something that we always carry.”
The team chose to develop a product with a few separate components because “there are other products that do one of those things, but we figured if we combine all that and then throw it into the F&I mix, it would be a lot more convenient for consumers to get a hold of,” said senior team member Jonathan Vollmuth.
One point the team homed in on was vehicle protection.
“The banks want to see something that protects their asset, and this is one thing that will do that because it tracks the vehicle, it protects the vehicle from unwanted wear-and-tear negligence,” and it documents service work that’s been completed, said senior team member Collin Ulvund.
The remote start feature can be used on a daily basis, while service updates may be used routinely. The security aspect, however, is “one of those features you hope you don’t have to use,” Vollmuth said.
Added Ulvund, “But you have it if you need it.”
Service and tech trend
Other teams also incorporated service and technology. Team GMR, for example, developed an OBD II port scanner that sends diagnostic codes to the customer’s dealership through a smartphone app.
Consumers can also purchase or remove F&I products through the app, and if there is an issue with the car, the app lets them know whether they’re covered under the factory warranty.
To drive service business back to the dealership, another team, Car Conglomerates, came up with a five-year service plan that would be paid upfront. It includes an annual tire rotation, oil change, 30-point inspection and full detail.
For consumers’ unexpected situations, students offered a twist on vehicle insurance products.
Team Automates developed diminished-value insurance. If a vehicle was keyed, say, the product would cover the difference between its as-is value at trade-in vs. its value if it were unblemished. The product is currently offered in some states, but not out of the F&I office, the team said.
Team Emulsion came up with “passing lane life insurance.” It provides security for family members if the consumer passes away while leasing a vehicle. Payments will be forgiven and the car will go back to the dealership. Credit life has age restrictions, but this product is for consumers of all ages.