Through the Internet Market Research Service (IMRS), Black Horse interviewed 1,700 customers who had either bought a used car in the last year, or intended to in the next 12 months. We found that if dealers asked customers about finance, 64% would want more information.
According to the survey results, only 10% of customers thought that dealer finance was the cheapest on the market – but 72% thought it was the easiest, most convenient and quickest way to sort out a deal. Surprisingly, this is more important to customers than the APR offered.
Also consider that 35% do not end up receiving the headline-grabbing APRs that direct lenders advertise, and over one half of all customers interviewed (56%) didn’t make a decision about finance until they had found the vehicle they wanted (ie in dealers’ showrooms).
Dealers have many opportunities to maximize the return on finance, and should remember that:
John Woolley, managing director says: “Direct lenders continue to pose one of the biggest challenges that face dealers today. We are very aware of this, and continue to develop initiatives to help dealers take direct lenders on.
“Clearly, dealers’ sales processes also need to be strong to ensure that dealer finance continues to be sold. Where appropriate, they must offer more competitive pricing; take slightly less commission on each sale but more frequently by automatically providing consumers with a quote.
After all, 64% want to hear about it! Only then will consumers see that it’s not worth going elsewhere, arrange everything they need through the dealer and increase dealers’ overall finance penetration.”
This is the first step in an on-going programme.