Technology has allowed consumers to create a truly omnichannel car shopping experience based on their own daily lives. Modern retail delivers this ability to browse, research and then purchase online or in-store and it will only continue to gain in popularity.
However, some dealers worry online platforms will cannibalize F&I revenue. They argue it's easier for customers to click away or miss the value of products when they're presented only on a screen. Without face-to-face discussions, customers don't get good information about extended warranties or GAP insurance, for example.
Yet, CDK Global data shows introducing F&I products earlier in the process with proper product education increases F&I sales by 15 percent. The convenience of digital platforms creates an opportunity for dealerships to sell more products if they can convey the value.
A renewed focus on F&I makes sense as lots fill with vehicles again. Inventory shortages over the past few years led to record-making profits. This slightly diminished the way some viewed F&I as a gross profit booster. With inventory rebounding and discounts back in play, dealers are once again looking to F&I sales to deliver additional gross profit.