Category: F&I

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EFG Companies F&I Featured

New Power x2 Product Doubles the Benefits of a Manufacturer’s Powertrain Warranty

-90 percent of consumers surveyed said they would seek out a dealership that offers it-

Power-x2-LogoEFG Companies, the innovator behind the award-winning Hyundai Assurance program, announced today the launch of Power x2, a powertrain protection vehicle service contract that doubles the benefit of the manufacturer’s powertrain warranty.  The new contract delivers a vital dealer tool, proven by independent research indicating that 90 percent of surveyed consumers say extended warranties impact their purchase.

According to a recent EFG survey conducted by a third-party research firm, 62 percent of consumers said the manufacturer warranty significantly affects what make and model of vehicle they consider purchasing.  New vehicles are exactly the same within a manufacturer brand from one dealer lot to the next, including MSRP and the manufacturer warranty. This underscores the need for dealers to give consumers a value-driven reason to come to their retail location versus the competitor down the street or across town. A recent statistic released by JD Power Automotive Internet Roundtable — that consumers now visit only 1.1 lots prior to purchasing a vehicle, down from three lots just five years ago — only amplifies the dealers’ need to deliver  increased value to consumers.

As consumers continue to keep their cars longer than historical norms, ongoing maintenance costs are more top-of-mind when making purchasing decisions.  According to EFG’s study, 48 percent of respondents expect to replace their cars every four to seven years, which could extend their ownership beyond 100k miles.  By doubling the benefits of the manufacturer’s warranty, dealerships have the opportunity to use this trend to their advantage. Seventy-two percent of the survey respondents stated that they would go out of their way to purchase a vehicle from a dealership that is less convenient to them if that dealership doubled the benefits of their manufacturer’s powertrain warranty as a complimentary offering.

“In this highly competitive market, we know that dealerships need showroom traffic now, whether online or at their physical location, not six months to a year from now,” said John Pappanastos, President and CEO of EFG Companies. “Power x2 provides dealerships an immediate means of capturing market share based on current consumer wants and needs by moving past the price game to a more value-based conversation that motivates car shoppers to a transaction.” Dealerships can also increase fee income by offering exclusionary coverage that wraps around Power x2 for a specified timeframe, which includes:

  • the suspension;
  • the fuel system;
  • the electrical system; and,
  • the cooling system, among others.

Power x2 gives dealers a valuable toolkit to address each customer’s specific need when it comes to taking care of their vehicle and protecting their pocketbook. EFG also acts as a very strong extension of the dealer’s customer service through its in-house claims administration that operates according to above-industry standard target SLAs.  This translates to enhanced customer retention and loyalty.

Contact EFG today for more information on this new product and how it can benefit your business.

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Dealership Recruiting Dealership Training Economy F&I

Three Steps to Maximizing Dealership Profitability

Contributing Author: John StephensOn the other end of a harsh economic recession, it’s become very clear that Americans of today are drastically different from Americans in 2008. People not only tightened their belts over the past four years, they also completely changed their relationship with retail. And, today’s consumers are focused on keeping their savings intact, companies are concerned with fortifying their business to survive future economic challenges. One way companies like Apple and Google achieved this was through providing more value to their customers through enhanced service offerings such as cloud computing, which made it easier for customers to upgrade mobile technology with a free service which made back-ups and syncing easier and more efficient.

So, let’s stop and think about the retail automotive industry for a second.

Whether the economy is good or bad, consumers will still be in the market for a car. However, their needs for said vehicle may change. For example, with the latest recession, we saw the trend of consumers purchasing cars that last longer with better gas mileage. They didn’t stop buying, they just changed what they bought and how often they bought it. They also became less brand-loyal.

The search for more value now extends beyond the car itself to the dealership experience. With so many dealerships to choose from and less brand loyalty, you actually have a greater chance of increasing foot traffic to your store by focusing on your value proposition.

The first step to fortify your value proposition is to go back to the basics:

  • Hire Top Performers that consistently deliver results on the sales floor and in the F&I office.
  • Place those Top Performers in roles where they will thrive and train them to maximize their strengths.
  • Focus on customer service, not just the sale. The best sales people see themselves as advisers. They listen to the customer and address their needs with courtesy and respect.
  • Position your dealership as providing value beyond low interest rates. This ties back into customer service and bridges into the F&I office. Consumers are paying more attention to their return on investment just like businesses. Provide products and service that reflect their need to keep their savings intact.

Elementary right? Don’t kid yourself. You might be surprised on how little time gets spent on the basics of right people, right position, right training.

Next, re-evaluate the value you provide in the F&I office. You consistently review how many deals your sales team closes in a month, your product penetration, web traffic, etc. When it comes to analyzing your F&I products, are you taking a strategic approach to analyzing their benefits for your dealership?

Strong F&I products do much more than sell. They:

  • differentiate your dealership in the market;
  • help build customer relationships;
  • are designed with the customer experience in mind; and,
  • increase service retention.

When evaluating your mix of F&I products, think beyond product penetration to how your products enhance gross dealership profit by creating a customer experience that fosters lasting relationships and repeat sales.

Lastly, pay attention to your online presence. According to a 2014 DealerTrack study, consumers now visit 1.2 showrooms before making a decision. This represents a paradigm shift in the way today’s consumers shop for a vehicle. Gone are the days of consumers spending their weekends visiting one dealership after another before a final decision is made. Now, the majority of that research is conducted online.

With the majority of customers browsing dealership websites and customer review sites before walking into on average, one showroom, it’s vital that your dealership has a healthy reputation. A good online reputation relies on the active management of customer review sites. While gaining positive reviews is the immediate goal with these sites, the second most important aspect is responding to negative reviews. Negative reviews don’t necessarily have to give dealerships a negative image. By addressing the customer’s concern and taking the conversation offline, dealerships have a great opportunity to turn that negative review into a positive experience. Customers expect to see negative reviews on these sites, but what they pay the most attention to is how the dealership handles them.

Beyond customer review sites, it is also important to optimize your social media assets. Facebook and Twitter have become two of the biggest platforms for consumers to directly interact with companies. Big or small, companies from all industries utilize these sites to inform the public about new products, receive feedback, conduct product promotions, etc. A well-developed social media presence is much more than creating a page and posting content. It involves engaging the audience with content that’s relevant to them, encouraging discussions, and responding to their inquiries or concerns.

Your online presence, F&I product mix, and commitment to customer service each demonstrate a different aspect of how your dealership provides value. Online, you have the chance to provide that excellent customer service to both current and potential customers, further developing lasting relationships and increasing long-term profit. With strategic F&I products, you have better opportunity to maximize unit sales and dealership profitability while offering customers tools to protect their bank account from unforeseen circumstances. Meanwhile, by focusing on the basics of hiring and cultivating top performers, you significantly increase your opportunities to close sales and drive customer retention.

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EFG Companies F&I

EFG Positions Independent Dealers to Capture Greater Share of Wallet

Specialized VSC Provides New Avenue into Under-Served Consumer Market

EFG Companies, the innovators behind the award-winning Hyundai Assurance program, announced today the launch of a new product designed to increase avenues of finance income into a severely under-served consumer market – Best ReGuards.

Best ReGuards is an extensive vehicle service contract from EFG, designed specifically for independent dealers, many of whom have a very loyal and referral-centric customer base, but often don’t have a deep bench of F&I products. This program sets the stage for independent dealers to capture a greater share of wallet by meeting their customer’s economic and vehicle protection needs.

EFG custom-developed Best ReGuards according to the needs of the independent dealership’s customer base by focusing on the most critical components of a used vehicle that are often the most costly to repair:

  • Transmission
  • A/C
  • Engine
  • Electrical
  • Seals/Gaskets

According to “FORBES”, many consumers are spending as their incomes rise, but are unwilling to borrow more money than absolutely necessary. When weighing the pros and cons of purchasing a used car with more years and higher miles, customers of independent dealers are concerned with not only price, but what the dealership can offer them at a reasonable price that others don’t, such as consumer protection products. These consumers may not be able to afford a traditional vehicle service contract, but they are still very interested in purchasing mechanical breakdown protection for their vehicle.

Independent dealerships are well positioned to tap into this growing consumer market. NADA predicts 2014 used car sales to top 42 million units nationwide, setting the stage for more intense competition.

“The independent dealership segment provides EFG a strategic opportunity to take what we’ve done extremely well for 37 years and immediately answer a rapidly-growing demand in the market,” said John Pappanastos, President and CEO of EFG Companies.  “Our products give independent dealers a more valuable toolkit to address each customer’s specific need when it comes to taking care of their vehicle and protecting their pocketbook.  We also act as a very strong extension of the dealer’s customer service through our in-house claims administration group that operates according to above-industry standard target SLAs.  This translates to enhanced customer retention and loyalty.”

Bill Gusa, Managing Partner of Olympic Dealer Marketing, worked closely with EFG on the development of Best ReGuards. “As supply is expected to outpace demand in 2014, our independent dealership partners needed to expand their product portfolio,” Gusa said. “Considering how few independent dealers have the access to provide F&I products, our desire was to give our clients the opportunity to increase their product portfolio and generate greater profits by providing a quality consumer protection product.”

EFG plans to launch a Best ReGuards limited powertrain warranty companion product in the second half of 2014.