Ally All Ears Podcast Episode | The Next Evolution of Virtual F&I

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 on how dealerships can continue to evolve their F&I process to increase customer satisfaction in dealership profitability.

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Jackie Charniga: Hello everyone. This is Jackie Charniga with Automotive News and welcome to the All Ears podcast. This podcast is sponsored by Ally Financial and produced by Automotive News Content Studio. In each episode, we cover topics important to automotive retail executives. We engage Ally leaders to deliver actionable solutions to dealers and others who are successfully navigating transformational industry changes. Today we sit down 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 on how dealers can continue to evolve their F&I process to continue increasing customer satisfaction in terms of dealer profitability. Hi JT. Thank you very much for taking the time.

JT Hoffman: Thank you very much for inviting me.

JC: Let’s start. We understand that customer satisfaction with the car buying process has reached record highs in the first year of the pandemic. Although satisfaction has declined somewhat in 2021, it is still above pre-pandemic levels. Car buyers were particularly pleased with the implementation of time-saving digital options in F&I. What have you heard about the evolution of F&I from dealers who have done business with Ally during this time?

JH: I’ve heard a lot of it, actually. Dealers share and see that consumers are doing a lot more research and shopping online with a wide range of purchases, whether it’s Amazon or large retailers, the automotive industry is no different . The market we find ourselves in and the expectations that are established and rooted in today’s culture are very important. Virtual F&I can mean a lot of things, and a customer can be at home or on site at a busy dealership and F&I managers from another store can help large groups of dealers, working themselves throughout the process online or at home. The facts are that many consumers are shopping online, they are landing on online vehicles and it is really a hot topic especially during the pandemic. The question many dealers have is, what does a virtual process look like? How to respond to prospects? Do I need to do a proper online needs assessment? What does a virtual walk look like? And how to transfer this into F&I? Am I facing one of the most important aspects of F&I to better educate our customers? They are more likely to 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 own homes, and progressive resellers in the market seem to be adapting very quickly to the preferences of these customers. Essentially, the train has left the station. Virtual F&I and technology will continue to evolve, and many dealerships want to be able to do everything in a customer-centric way, improving not only their profits, but also their CSI, leading to smoother transitions and transactions for their customers.

JV: And based on what they’ve learned during the pandemic, what could dealerships do to continue to evolve the F&I process?

JH: I think dealerships are going to continue to evolve, they’re going to embrace the new normal, and a lot of dealerships have already started down that path. More investment in technology is going to be required as it continues to develop and evolve. That said, it’s equally, if not more, important that dealerships have a transparent sales process and that they continually train their teams to move virtually and in-store in F&I. More and more consumers, they are researching and shopping. They decide on the car they want, and they do it virtually. As they search for resellers who stick to this virtual plan, it gives them more choice to drive the rest of the process, whether in-store or online. I think it’s obvious and well known that consumers want to work with professionals who are knowledgeable, flexible, and willing to work with them, whether that’s virtually or through a traditional process. Dealers must take the time to understand their needs and adapt accordingly. The good news is that dealerships that scale, and many currently do, will deliver unique experiences that meet their customers’ needs. Most importantly, it will create a loyal customer base that will provide the best form of word of mouth advertising to their friends and family.

JC: I’m really interested in what you just said about adaptability, especially for dealerships running a hybrid process for customers who go back and forth between in-person, online, and virtual connections with the dealership . What is the best method to handle this?

JH: That’s an excellent question. I would say the key to managing a hybrid process for clients will more likely be something that starts with a well-strategic needs analysis for each client and scales accordingly based on the client’s desire to transact virtually or traditionally. I know this can be frustrating for some dealership staff. Historically, we have worked in a linear, in-person sales process and change can be difficult if not embraced. I have personally heard many dealership employees say that they sometimes feel like they lose control of the customer in the process. But having said that, I think if there’s a store that’s not ready to rotate, there’s going to be more customer movement in the direction of the stores that are and then you need to be able to do that not just virtually, but also traditionally. More and more of the dealers Ally does business with continue to ask for this kind of help. In fact, one of the most requested training topics we receive is on this topic of Virtual F&I and Virtual Sales Process. Many dealers recognize that they have to adapt. They are simply looking for help not only to train their staff, but also to make specific, actionable suggestions that form a process that works best for their program and goals.

JC: The process of buying a car has changed so much in recent years. If you could look ahead a bit, what might the F&I process look like in, say, five or ten years?

JH: In five or ten years, I believe that although there are currently very few digital platforms that perform a complete end-to-end transaction, including financial products and F&I, leaders will emerge with complete solutions and they are going to emerge with solutions that are also going to be mobile friendly very, very soon. I believe that the financial space will no longer need paper providing full capability to work traditionally or virtually. Everything from reviews, menu pitch, items sent to the bank, they will be paperless and completely digital. Finally, while it is true that a virtual F&I process has many benefits for the consumer and allows for greater transparency, a faster process and a better overall customer experience, dealers should be aware that it also offers more flexibility in coverage. And in the case of a large group of dealers, for example, with multiple roofs, they can see themselves with the potential for a centralized F&I department or, at the very least, share leadership capital between stores and improve their economies of scale.

JC: That’s it for this episode of the All Ears podcast. Many thanks to JT for this information. On behalf of Ally and Automotive News Content Studio, thank you for listening.

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