Archive for the ‘News’ Category

First impressions in showroom, online the keys to women shoppers

Women shop for cars where they feel comfortable.

That comfort level begins with the greetings they receive and the way they are treated afterward.

And the sales adviser holds the key to that encounter, according to the 2019 Women’s Car Buying Report from a survey of almost 5,400 women shoppers by JoinWomenDrivers.com.

032619 IL First impressions in showroom, online the keys to women shoppers

 

All of this is significant for dealerships because women now account for 45 percent of new-car purchases – about 7.75 million in 2018 based on NADA’s report of total U.S. sales of 17.2 million.

(The Women’s Choice Award website suggests women currently represent 52 percent of buyers.)

“Their [sales] consultant is the No. 1 influencer at a dealer,” said the JoinWomenDrivers.com’s report.

“Price is still important, but not a differentiator, since women know they can find a car elsewhere within a narrow price margin.” In fact, that was true for all seven top brands – Chevrolet, Ford, Jeep, Honda, Nissan, Subaru and Toyota – represented in the buyers’ survey.

Impressions matter

“It is the consultant’s attitude and impression that makes all the difference. The initial contact and the creation of trust is critical to establishing credibility and making an outstanding first impression.” Dealer reputation is the second-most-important reason for buyers of four brands.

“While dealership culture has seen a shift, more must be done to [attract] and retain women buyers and for dealers to meet their unique expectations and needs,” said Anne Fleming, president and car buying advocate for JoinWomenDrivers.com.

A welcoming atmosphere

“Creating an atmosphere where the buyer feels welcome, understood, and has the experience of being in control of their buying experience are the ingredients to a successful sale.”

So what’s a savvy dealer to do to adapt to the changing marketplace?

“Dealers need to re-examine the one-size-fits-all approach to marketing and better tailor to an every-growing base of [women] customers,” said the report. “Valuing these buyers – through effective and creative marketing strategies – will increase dealers’ overall sales.”

“Training and coaching the frontline team to adopt attitudes and greetings that women consider trustworthy, engaging and respectful is paramount.”

First impression online

But creating a good first impression online also is important, the report said.

The report points out that dealership websites are either the first or second destination for six of seven of the manufacturers included in the website’s survey. Nationally, however, women shoppers graded dealership websites a “C” in being helpful and informative. “Collectively, OEMs, Web providers and dealers have work to do to bridge the gap to add value.”

“Most dealer websites continue to be pictorially product-centric,” said the JoinWomenDrivers.com report. “[But] consumers engage more fully when they feel welcomed by lifestyle images from various cultures, life stages and demographics. Informative content about car buying and the ownership experience draws viewers in and establishes credibility.”

Combined, these firsts leave powerful impressions on the consumer experience. Indeed, “Research shows the first engagement is the only one that matters – there are no second chances.”

Franchise dealers appear optimistic, but ‘euphoria’ of 2018 is gone

Auto dealers are an optimistic lot, it seems, even though sales for the first two months of 2019 were at their lowest level in five years.

And the outlook that new-car sales will fall short of recent years.

While describing a relatively “weak” market – 48 on a 100-point scale – in the first-quarter Cox Automotive Dealer Sentiment Index, those same dealers anticipate an uptick in business within the next three months – rating prospects a 63 on the same scale.

A slow start to 2019 has dealers pondering the future.

A slow start to 2019 has dealers pondering the future.

The overall expectations were about the same for franchise dealerships (62) as they are for independents (63), according to the Cox survey.

Both numbers were significantly higher than expectations reported last quarter.

But “gone is the euphoria we saw this time last year,” Cox reported, especially for new-car sales, which exceeded 17 million for the fourth consecutive year in 2018 despite earlier gloomy forecasts. Franchise dealers rated the current used-vehicle sales environment “good” at 66 on the 100-point scale, but the new-vehicle sales environment as pretty middling at only 53.

Still, franchise dealers were more positive about the current market than independent dealers, who anticipate used-car sales to be on the “poor” side of middling at 48 points.

Some caution would seem to be in order, though, as franchise dealerships are seeing inventories grow for both new and used cars creating pressure to lower prices, based on results of the Cox survey. Independent dealers indicate they also are feeling pressure to lower prices.

In fact, dealers are saddled with the most inventory since the Great Recession – more than four million new vehicles, a 79-day supply – Automotive News reports.

The quarterly survey is conducted online, with dealer responses weighted by dealership type and sales volume to reflect the national dealer population.

Nearly 1,200 dealers participated in the survey, which was conducted Jan. 28 to Feb. 8.

When was the last time that shoppers beat a path to your showroom?

It’s all in the numbers.

The Preapproved Direct Mail Program from Santander Consumer USA is making an impact for participating dealers across the country.

Results include a higher-than-average response rate, strong incremental sales and outstanding ROI.

“My store runs a 6,000 Santander direct mail piece every 30 to 60 days,” Jeff Belsky of Benson Hyundai in Spartanburg, SC, said recently. “Lead generation has been through the roof, with unprecedented numbers of leads and prospects increasing with each run.”

“The mailer was extremely successful and profitable for the store,” said Timmy Dickinson of Lia Hyundai in Enfield, CT. “It generated 63 leads, which resulted in 38 shows, 14 sold and a profit of around $30,000. It was our best used car month in a long time!”

The direct mailer is not a “weekend barn burner,” because leads will continue to come into your store for up to 90 days after the mailer drops.

There’s a lot to consider, including additional results, so we created the following infographic to help:

 

030719 IL When was the last time that shoppers beat a path to your showroom (1)

The RoadLoans advantage: Connecting your dealership with motivated buyers

RoadLoans is all about helping dealers maximize sales opportunities.

From the online dealer Lead Exchange Program to the direct-to-consumer lending program, RoadLoans’ mission is to connect dealers with motivated buyers.

The Lead Exchange Program (see infographic below) provides your dealership the opportunity to bid for approved-customer leads that are 100 percent exclusive to your business, giving you the opportunity to get more ready-to-buy shoppers through your doors each month.

No subscription is required to participate in the RoadLoans Lead Exchange Program – your dealership can turn it on and off at your discretion.

Through the direct-lending program, RoadLoans – and parent Santander Consumer USA (SC) – provides full-spectrum lending with competitive rates for qualified buyers: The typical RoadLoans approval has an average FICO of 577, income of $61,000 and is approved for financing up to $18,000.

RoadLoans also recommends to approved customers a qualified dealer in their area, and the dealer immediately receives an email notifying them of the approval and providing contact information. Direct-lending customers, however, are not required to take their voucher to the recommended dealership, so dealers should be sure to work their leads promptly.

For more details on RoadLoans programs and maximize your results through the busy tax season, contact your SC Dealer Relationship Manager.

022819 IL The RoadLoans advantage- Connecting your dealership with motivated buyers (1)

What you need to know about fraud risk and ‘Driving a New Model’

Fraudsters never rest.

And they may be headed to your dealership.

But Santander Consumer USA (SC) is committed to providing the information you need to fight back.

Our series, Driving a New Model, should help dealers spot the red flags for identity fraud, application misrepresentation, straw buyers and elder abuse, and includes actionable checklists.

“Awareness of fraud and elder-abuse red flags will allow you to take steps to reduce these risks and will result in a number of benefits,” says the SC pamphlet, Driving a New Model | A dealer guide to recognizing the warning signs of fraud, identifying suspicious buyers and taking action to reduce costs.

Driving a New Model suggests those benefits could comprise:

PART 6

  • Improvement in the overall customer experience
  • Reduction in consumer harm and risk to the dealer’s reputation
  • Reduction in credit stipulations on an application
  • Reduction in funding delays to dealership
  • Reduction in post-funding disputes and potential unwinds

“Establishing a partnership with lenders is the best way to fight fraud,” wrote Frank McKenna of PointPredictive consulting firm in a separate Digital Dealer Magazine report 5 Reasons Car Dealers Should Be Concerned with Fraud. “Since lenders have more tools to diagnose and detect fraud, they can help you understand the impact to you before it ever happens.”

“Good collaboration on fraud is the key to winning the war on fraud,” according to McKenna.

And, as far as SC is concerned, “We actively seek your feedback and your insights into trends and concerns related to the risk of fraud or elder abuse,” says Driving a New Model.

Here are the first five parts of our series:

Part 1: What you need to know about fraud risk – and why you should care

Part 2: Identity fraud can take ‘enormous toll’ on your dealership profits

Part 3: How to change the odds in your favor against application fraud

Part 4: What straw buyer fraud could mean to your dealership and how to avoid it

Part 5: How to recognize elder abuse if your dealership is targeted

But the fight against all types of vehicle-purchase fraud doesn’t end at the dealership door.

If you notice unusual behavior or information by applicants, please contact your SC Dealer Relationship Manager who can direct these concerns to the appropriate team to review.

Fraudsters never rest, and neither should you.

Together we can stop fraud.

How to recognize elder abuse if your dealership is targeted

It sounds awful, because it is.

The illegal, unauthorized or improper use of an older individual’s resources by a caregiver or other person in a trusting relationship for the benefit of someone other than the older individual.

“This includes, but is not limited to, depriving an older person of rightful access to, information about, or use of, personal benefits, resources, belongings or assets,” according to the Enterprise Fraud Management (EFM) team at Santander Consumer USA (SC).

Examples include forgery, misuse or theft of money or possessions; use of coercion or deception to surrender finances or property, or improper use of guardianship or power of attorney.

PART 5

“We have seen an uptick in activity and awareness with elder abuse investigations at SC and amongst our peers in the Auto Industry,” said Mark Kasak of the company’s EFM team.

RELATED

What you need to know about fraud risk – and why you should care (Part 1)

Identity fraud can take ‘enormous toll’ on your dealership profits (Part 2)

How to change the odds in your favor against application fraud (Part 3)

What straw buyer fraud could mean to your dealership and how to avoid it (Part 4)

One report in a small-town newspaper in Georgia recounted how the niece of an elderly couple obtained guardianship over her uncle and aunt, then discovered that a sitter had stolen money from them to put a down payment on a vehicle for her boyfriend. The niece also discovered that her uncle’s name was on the car loan, but that the title was in his and the boyfriend’s names. There was no indication that the car dealership participated in the fraud.

“Perpetrators of elder financial abuse are often family members, friends, caregivers or the common predatory scammer, but the result is usually the same,” said the Massachusetts Office of Consumer Affairs. “The victim is robbed of his or her savings or income and left in despair.”

Here’s what Santander Consumer USA’s Driving a New Model | A dealer guide to recognizing the warning signs of fraud, identifying suspicious buyers and taking action to reduce costs suggests to look for to reduce elder abuse fraud risk at your dealership:

The Red Flags

  • Buyer applies with an older adult to be the co-buyer
  • Older adult can’t come to dealership to sign contract
  • Older person makes statements like “I’m only here to help”
  • Applicant and co-buyer have different addresses
  • No reasonable benefit to the older adult in the vehicle being purchased
  • Older adult is on a fixed monthly income that does not support the vehicle payment

And the Checklist

  • Both applicants present at time of contract signing
  • Don’t allow the contract to leave the dealer premises
  • Ask about power of attorney and caregiver relationship
  • Ask older adult for independent references and contact the reverences

“Santander Consumer USA (SC) is committed to working with dealers to raise awareness of fraud and elder-abuse risks in the retail auto space,” says Driving a New Model, which was created by SC’s fraud management group. “Watching for red flags is the most cost-effective way of preventing fraud and reducing expenses related to fraud, reputation, regulatory and financial risks.”

This series, Driving a New Model, is aimed at helping dealers spot the red flags for identity fraud, application misrepresentation, straw buyers and elder abuse, and includes actionable checklists.

Santander Consumer, Chrysler Capital get valuable ‘face time’ at NADA

It’s one of the biggest auto industry events of the year.

The National Automobile Dealers Association convention (NADA) – held this year in San Francisco, CA.

Both Santander Consumer USA (SC) and Chrysler Capital were represented at the event, held Jan. 24-27, CCAP with an exhibitor booth on the convention floor and a co-branded special event.

Distinguished Dealers cruise on the California Spirit.

Distinguished Dealers cruise on the California Spirit.

They were among the 22,000 attendees – including thousands of dealers – and more than 500 exhibitors who participated in the four-day convention and expo, which included keynote sessions with industry experts and key business leaders, more than 120 workshops and education sessions, speakers on dealer solutions, a social connection zone, dealer franchise meetings and more.

Santander Consumer and Chrysler Capital hosted a co-branded event, a cruise around San Francisco Bay for 80 of our distinguished dealers, key dealer groups and digital partners such as Cars.com.

Mixing business with pleasure.

Mixing business with pleasure.

“NADA is great, because it provides leadership from Santander Consumer and Chrysler Capital the opportunity to get a significant amount of face time with dealers and OEM partners from around the country,” said Matthew Stewart, vice president of marketing. “We do a lot of listening to dealers on the convention floor and during various events – hear what the dealers themselves are thinking unfiltered.”

“NADA gives us an opportunity to see our dealer partners in a different setting, away from the stresses they deal with every day,” said Vince Meglio, senior vice president of SC sales. “That allows them to focus on the big picture and long-term plans for their future.”

“It also allows us at SC to intently listen to their hopes, along with sharing our ideas for the future and how we can partner with their specific dealership for mutual success,” Meglio said.

Spirits were high on the co-branded Bay cruise.

Spirits were high on the co-branded Bay cruise.

“It’s so productive to have that many dealers and business partners in one place,” added Sales Director Barbara Fortune. “It allows us to share ideas with our dealers and enhance relationships.”

Sales Director Eleni Egoville described “in-depth and nuanced conversations with dealers.”

Convention speakers included Wes Lutz, president of Extreme Dodge-Chrysler-Jeep-Ram in Jackson, MI, and outgoing NADA chairman, who encouraged dealers to embrace change that is happening industrywide, continue to listen to their customers and “writing the script” about the industry’s future.

“Our customers tell us what they want from the market every day when they spend their money,” Lutz said. “And no one listens to the customer better than we do.”

Lutz is being succeeded as NADA chairman by Charlie Gilchrist, whose Gilchrist Automotive comprises eight dealerships in the Dallas-Fort Worth area, including Ford, Buick, GMC, Chevrolet, Nissan and Volkswagen as well as Chrysler, Dodge, Ramp and Jeep.

NADA, which has hosted an annual convention for more than 40 years, represents nearly 16,500 franchised new car and truck dealerships.

Sightseeing at the Golden Gate Bridge.

Sightseeing at the Golden Gate Bridge.

 

Cruising past Alcatraz in San Francisco Bay.

Cruising past Alcatraz in San Francisco Bay.

What straw buyer fraud could mean to your dealership and how to avoid it

Beware the straw buyer.

That is, a purchaser who looks like the real thing – but isn’t.

The buyer could be someone purchasing the vehicle for a consumer with disqualifying credit issues, or he/she could be “a criminal who is perpetrating a fraud scheme.”

Such as the Wisconsin man who authorities have charged with a dozen counts of money laundering that involved selling luxury cars overseas by defrauding local car dealers. Using dozens of straw buyers, the man allegedly secured $30 million in financing to buy the vehicles.

PART 4

“To a lender, a straw buyer might look like a real buyer,” wrote Frank McKenna, chief strategist at PointPredictive, a consulting firm specializing in fraud prevention. “[But] their whole purpose is to get a lender to give money to an organized group of crooks.”As in the Wisconsin case, selling to a straw buyer or buyers can hit a dealer’s bottom line hard.

RELATED

What you need to know about fraud risk – and why you should care (Part 1)

Identity fraud can take ‘enormous toll’ on your dealership profits (Part 2)

How to change the odds in your favor against application fraud (Part 3)

“Lending to straw buyers/borrowers often leads to extremely high levels of default … In fact, most loans will default without a single payment,” wrote McKenna, who calculates that “at an average loss of $24,000 per fraud occurrence, your dealership is forced to sell 10 cars to make up for a single instance.”

Here’s what Santander Consumer USA’s Driving a New Model | A dealer guide to recognizing the warning signs of fraud, identifying suspicious buyers and taking action to reduce costs suggests to look for and to reduce straw buyer fraud risk at your dealership:

The Red Flags

  • Applicant is declined and then returns with a co-buyer
  • Co-buyer has a different last name and/or address
  • Applicant asks to take contract to co-buyer
  • Primary and co-buyer continue to change on the same vehicle application
  • Insurance policy lists multiple vehicles with different last names

And the Checklist

  • Both applicants present at time of contract signing
  • Don’t allow the contract to leave the dealer premises
  • Ask for references on both applicants, and contact the references
  • Ask who will be making payments while both applicants are present

“Santander Consumer USA (SC) is committed to working with dealers to raise awareness of fraud and elder-abuse risks in the retail auto space,” says Driving a New Model, which was created by SC’s fraud management group. “Watching for red flags is the most cost-effective way of preventing fraud and reducing expenses related to fraud, reputation, regulatory and financial risks.”

This series, Driving a New Model, is aimed at helping dealers spot the red flags for identity fraud, application misrepresentation, straw buyers and elder abuse, and includes actionable checklists.

The top 5 pitfalls to avoid when submitting deal packages to SC

Tax season sizzles for most dealerships.

That means getting through the funding process is going to be extremely important to keep business flowing smoothly through March and April.

Santander Consumer USA (SC) will be working hard to manage the flow of tens of thousands of contracts from dealers that will be needed to finance new and used vehicles during these busy months.

The goal at SC is to have complete contract packages funded within 24 hours. Yet, with so many contracts there are bound to be small hiccups here and there.

For example, calling about a contract before 48 hours has passed – 72 hours in the case of tax season – actually slows processing of contracts to all dealers, and will not move the caller’s funding package ahead of others that have been in house longer.

Otherwise, here are the top five pitfalls some dealerships encounter – and you can avoid – when submitting deals to SC funding that can slow down the process:

We can’t get in touch with the applicant

When funding receives a deal, chances are that some information will need to be verified before the deal is given the green light. If funding doesn’t have the correct contact information for your customer, the deal can’t be finalized. It’s critical that phone numbers and/or contact people are correct so that funding can reach them if necessary.

Submitting incomplete contract packages

Our funding team can’t complete your deals until all of the documents in the package are received. By using SC’s funding checklist, it’s easier to ensure your funding package is complete.

The approval terms don’t match the contract

If multiple approvals have been received for the same customer, double-check your documents to make sure the correct approval sheet is attached to the contract package. In addition, check with your buyer before making changes to the approval terms. These two steps can save a significant amount of time and confusion once the package hits funding.

Income is not verifiable

Reviewing the customer’s paystub prior to completing and submitting an application can save time down the road. A lot of customers will provide their net income versus gross, and some just take a wild guess when completing a credit application. Request a check stub from your customer, and review it with them to ensure the proper monthly income is entered on the application.

Vehicle value does not match the value on the approval

If a customer changes his/her mind about which vehicle to purchase, it’s critical to update the vehicle with your buyer. Send an update via Dealertrack or RouteOne alerting your buyer to the change, and get an updated approval so there won’t be issues that delay your funding. You also have the option of updating the vehicle in our Rehash Tool. Just log in to the Dealer Extranet to update your structure for a quick look at what the changes will mean.

Tax season presents a wealth of opportunities to boost your bottom line to the top of the charts. So don’t let small pitfalls keep your dealership from achieving your goals.

If you have questions, contact SC funding from 8 a.m. to 7 p.m. CT, Monday through Friday, at funding@santanderconsumerusa.com or 800-877-4696.

 

020719 IL Putting a premium on accurate paperwork can help deals flow smoothly (2)

How to change the odds in your favor against application fraud

When the numbers just don’t add up …

It could be an honest mistake or a misunderstanding.

Or it could be fraud, specifically, application misrepresentation, according to a dealer brochure developed by the Enterprise Fraud Management team at Santander Consumer USA.

A good time to figure that out is when the customer applying for financing is sitting right in front of you.

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PART 3

“Only about 15 percent of auto loan fraud is identity theft,” wrote a fraud strategist from PointPredictive consulting firm. “So if your only fraud control is checking a driver’s license or Social Security card, then you are really only addressing a small fraction of the risk.”

The risk with every auto finance application also includes:

  • Income fraud in which a borrower lies about his/her income.
  • Employment fraud in which the borrower lies about employment, work history or job title.
  • Document fraud in which a borrower falsifies pay stubs to substantiate income claims.

RELATED

PART 1: What you need to know about fraud risk – and why you should care

PART 2: Identity fraud can take ‘enormous toll’ on your dealership profits

And the more finance applications your dealership submits, the greater your chances of falling victim – unless you take (or have taken) steps to change the odds in your favor, of course.

SC’s Driving a New Model | A dealer guide to recognizing the warning signs of fraud, identifying suspicious buyers and taking action to reduce costs suggests what to look for and how to reduce application misrepresentation risk at your dealership:

The Red Flags

  • Income inconsistent with local salary rate.
  • Business revenue inconsistent with personal or self-employed income.
  • Income that seems inappropriate for the applicant’s age or the employer.
  • Non-existent employer, unfamiliar employer name or no longer employed.
  • Address is a P.O. box, drop box or mail forwarding address.

“It’s quite common for employment information to be fabricated during the auto-lending process,” cautioned the PointPredictive consultant.

And the Checklist

  • Pay attention to buyer behavior, such as nervousness or indirectness in answering questions.
  • Pay attention to application details by comparing application information to the credit bureau report – do the trade lines seem appropriate with the applicant’s stated income and position?
  • Ask for income verification via pay stubs – make sure they’re genuine – or other documentation. Call employer phone number and contact references.

“Santander Consumer USA (SC) is committed to working with dealers to raise awareness of fraud … in the retail auto space,” says the company. “[And] watching for red flags is the most cost-effective way of preventing fraud and reducing expenses related to fraud, reputation, regulatory and financial risks.”

This series, Driving a New Model, is aimed at helping dealers spot the red flags for identity fraud, application misrepresentation, straw buyers and elder abuse, and includes actionable checklists.