Performing well on the basics of financing can lead to a significant boost in customer satisfaction according to J.D. Power.
J.D. Power 2016 U.S. Consumer Financing Satisfaction Study
The pace of new-vehicle retail sales is slowing. According to J.D. Power, U.S. light vehicle retail sales are expected to reach 14.0 million units in 2016. That number is down 1.5% from the recording-breaking 2015 numbers.
With this in mind, it's prudent for dealers and lenders to focus on building relationships with their customers. And, according to the findings of the J.D. Power 2016 U.S. Consumer Financing Satisfaction Study, these relationships will help increase satisfaction and business retention.
The 2016 U.S. Consumer Financing Satisfaction Study examined customer satisfaction with auto finance providers and the entire financing experience. It is based on responses of more than 19,000 customers who financed or leased within the past four years.
The overall takeaway? Dealers and lenders who perform well in the basics of financing can boost consumer satisfaction and generate repeat business.
The vehicle financing environment can be complicated for customers. Don’t overlook the basic steps that can provide clarity. The study indicates doing so will increase satisfaction and give dealers and lenders a competitive advantage. Remember, this is even more critical in a slowing retail marketplace where the auto lending market is more competitive.
With this in mind, J.D. Power identified five basics of financing that dealers and lenders must keep in mind. They believe these aspects will lead to a better customer experience and improved satisfaction.
The Five Basics of Financing
Getting back to the basics of financing will help dealers and lenders better satisfy customers.
- Explain the Basics of the Deal
Satisfaction was found to be higher among customers whose dealer or finance manager explained the finance deal in detail than among those who didn't get a thorough explanation. Highlight account features, services and benefits of the financing!
- Provide a Reference Guide
Start out on the right foot by providing each customer with a lender reference guide. This can answer common loan servicing questions and cover basic information.
- Have Self-Help Tools
Simple convenience tools were shown to greatly improve customer satisfaction. Specifically, the ability to email customer service and make payments online led to happier consumers.
- Resolve Problems on the First Try
Satisfaction declines significantly when a customer has to contact their lender more than once to solve an issue. That's not a shocker, so do what you can to make sure you can problem solve on the first try.
- Satisfaction Leads to Loyalty
Again, no surprise here, but the numbers are still eye opening. The study found that "highly satisfied" customers (those with overall satisfaction scores above 900 on their 1,000-point scale) are nearly twice as likely to return to a particular dealership and are more than twice as likely to purchase or lease the same brand again compared to those who are less satisfied.
The study also ranked the lenders and captives in terms of overall satisfaction.
Luxury Brand Overall Satisfaction Rankings (1,000-point scale)
- 1. Lincoln Automotive Financial Services: 879
- 2. BMW Financial Services: 866
- 3. Audi Financial Services: 864
- 4-7. Acura Financial Services, Bank of America, Chase Automotive Finance, and Mercedes-Benz Financial Services all tie: 862
Mass Market Brand Overall Satisfaction Rankings (1,000-point scale)
- 1. Ford Credit: 856
- 2. Bank of America: 854
- 3. Kia Motors Finance: 851
- 4. Capital One Auto Finance: 849
- 5. Toyota Financial Services: 845
This is the second year in a row that Ford and Lincoln have topped the rankings.
The Bottom Line
Dealers and lenders who focus on the basics can improve customer satisfaction and retention. Speaking of satisfied customers, who's more satisfied than a subprime customer who finally lands an approval?
Auto Credit Express has the best subprime car sales leads around. We also provide the tools to make your special finance department more efficient and profitable. Get in touch with us to learn more by calling us at 888-535-2277 or by filling out our contact form.