JT Hoffman, senior director of insurance sales for Ally Southeast Region, discusses the galvanizing force of the pandemic on the digital transformation of the finance and insurance process. He also has some tips for how dealers may continue evolving their F&I process to increase customer satisfaction in dealer profitability.
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Jackie Charniga: Hi, everyone. This is Jackie Charniga with Automotive News and welcome to the All Ears podcast. This podcast is sponsored by Ally Financial and is produced by the Automotive News Content Studio. In each episode, we delve into topics important to executives in automotive retailing. We tap Ally leaders to offer actionable solutions for dealers and others who successfully navigate transformational changes in the industry. Today we catch up with JT Hoffman, senior director of insurance sales for Ally Southeast Region, to discuss the galvanizing force of the pandemic on the digital transformation of the finance and insurance process. JT shares some tips for how dealers may continue evolving their F&I process to continue increasing customer satisfaction in dealer profitability. Hi JT. Thank you so much for taking the time.
JT Hoffman: Thank you very much for having me.
JC: Let's get started. We understand that customer satisfaction with the car buying process hit record highs in the pandemic's first year. Although satisfaction dipped somewhat in 2021, it's still higher than pre-pandemic levels. Car buyers were especially happy with the implementation of time saving digital options in F&I. What have you heard about the F&I evolution from dealers who did business with Ally during that time frame?
JH: I've heard a tremendous amount, actually. Dealers are sharing and they're seeing that consumers are doing much more research and buying online with a wide array of purchases, whether it's Amazon or major retailers, the automobile industry is no different. The market that we are in and the expectations that are being set and ingrained in today's culture are very much top of mind. Virtual F&I can mean many things, and a customer may be at home or on site at a busy dealership and F&I managers in another store might be assisting for large dealer groups, working through the process online or from home themselves. Facts are that many consumers are doing their shopping online, they’re landing on vehicles online and this is really a hot topic, especially through the pandemic. The questions for many of the dealers is what does a virtual process look like? How do I respond to leads? Do I do a proper needs assessment online? What's a virtual walk around look like? And how do I move that into F&I? Am I experiencing one of the most important aspects of F&I in better educating our customers? More likely they'll buy the products once they understand what the products do for them. More and more of these consumers want to be educated from the comfort of their home, and progressive dealers in the market seem to be adapting very rapidly to those customers’ preferences. Essentially, the train's left the station. Virtual F&I and the technology will continue to evolve, and many of the dealers want the ability to do everything in a customer centric manner, enhancing not only their profits, but their CSI, leading to smoother transitions and transactions for their customers.
JV: And building off what they learned during the pandemic period, what might dealers do to continue evolving the F&I process?
JH: I think dealers will continue to evolve, they’re going to embrace the new norm and many dealers have already started down this path. There's going to be a need for further investment in technology as it continues to develop and evolve. With that said, it's equally, if not more important that the dealerships are set with a seamless sales process and they're continuously training their teams to move through F&I virtually and in-store. More and more consumers, they're researching and their shopping. They're deciding the car they want, and they're doing so virtually. As they search out dealers who respect that virtual plan, it gives them more choice to drive the remainder of the process, whether in-store or online. I think it's obvious and well known that consumers want to work with knowledgeable professionals that are flexible and willing to work with them, whether it's virtually or in a traditional process. Dealers need to take the time to understand their needs and adapt accordingly. The good news is dealers that do evolve, and many are currently doing so, will provide unique experiences that meet the needs of their customers. Most importantly, it's going to create a loyal customer base which will provide the best form of advertising word of mouth to their friends and family.
JC: I'm really interested in what you just said about adaptability, in particular for dealerships managing a hybrid process for customers who are moving back and forth between in-person, online and virtual connections with the dealership. What's the best method of managing that?
JH: That’s a great question. I'd say the key to managing a hybrid process for customers will be more likely something that starts with a well strategized needs analysis for every customer and adapting accordingly based on the customer's desire to transact virtually or traditionally. I know this can be frustrating for some dealership personnel. Historically we've worked in linear, in-person sales process and change can be difficult if not embraced. I personally heard many dealers’ employees state at times it feels as though they are losing control of the customer in the process. But with that said, I think if there's a store that isn't prepared to pivot, there will be more customer movement in the direction of the stores that are and then you're going to need to be able to do so not only virtually, but traditionally as well. More and more of the dealers that Ally does do business with keep asking for this type of help. In fact, one of the most highly requested training subjects we get is on this topic of virtual F&I and virtual sales process. A lot of dealers accept that they need to adapt. They're just looking for assistance to not only train their people, but also to make specific, actionable suggestions that form a process that works best for their agenda and their goals.
JC: The process of buying a car has changed so much in the past few years. If you could think ahead a few more down the line, what do you think the F&I process might look like in, say, five or ten years?
JH: Five or ten years from now, I think while there's very few digital platforms currently that achieve a full end to end transaction, including finance and F&I products, leaders are going to emerge with full solutions and they're going to emerge with solutions that are going to be mobile compatible as well very, very soon. I feel that the finance space will no longer have the need for paper providing total capability to work traditionally or virtually. Everything from reviews, menu pitch, items sent to the bank, they'll be paperless and completely digital. Lastly, although it is true that a virtual F&I process has many benefits for the consumer and allows for more transparency, quicker process, and overall better customer experience, dealers should know that it also provides more flexibility on coverage. And in the case of a large dealer group, for example, with multiple rooftops, they can see themselves with the potential for a centralized F&I department or at the very minimum, sharing leadership capital between stores and improving their economies of scale.
JC: That's it for this episode of the All Ears podcast. A big thank you to JT for providing those insights. On behalf of Ally and the Automotive News Content Studio, thanks for listening.
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