Lenders accelerate e-commerce biz via Vroom [Spotlight]

COVID-19 has spurred some of the nation’s largest auto financiers to accelerate adoption of an e-commerce
business model.

Enter startup Vroom, an online used-car buying platform that rivals Carvana, offering more than 3,000 used vehicles with at-home pickup and delivery. The platform also arranges financing through more than a dozen lenders, including Capital One Auto Finance and TD Auto Finance.

Since the crisis began, Santander Consumer USA inked a multiyear financing agreement with the seven-year-old company, and Ally Financial doubled Vroom’s floorplan line of credit to $450 million. Also, JPMorgan Chase launched its co-branded finance arm, Vroom Financial Services by Chase, on April 1.

At the helm of these strategic partnerships is Chief Revenue Officer Mark Roszkowski, who is responsible for delivering profit growth by leading inventory acquisition, wholesale operations, consumer financing, product sales and all related operational management.

Vroom’s platform leverages the U.S. economy’s embrace of the e-commerce business model, with retail e-commerce sales up 16.7% year-over-year for a total of $158 billion during the fourth quarter of 2019, according to the U.S. Department of Commerce.

The startup is poised for rapid growth as e-commerce spending has spiked 46% since late February, when the coronavirus outbreak began in the U.S., according to data platform Signifyd.

To that end, Roszkowski shared with Auto Finance News his goals for Vroom Financial Services and how the company’s business model is priming the startup for success amid these challenging times. What follows is an edited version of Roszkowski’s conversation with AFN.

Auto Finance News: As Vroom’s chief revenue officer, how do you apply the lessons learned from your past experiences to your current role in the automotive industry?

Mark Roszkowski: I have had the fortunate experience of working at great technology-related companies over the course of my career that always put the combination of the best customer experience and continuous innovation at the center of their strategies. Doing so leads to creating and fostering lifelong customers.

At Vroom, we are working hard to deploy those same principles — leveraging leading technology, creativity and innovation to drive the best customer experience — now applied to digital financial solutions and the overall carbuying experience.

AFN: Vroom already had several partnerships with auto lenders throughout the years, and its enhanced partnerships have come during a time when a digital presence is critical for lenders. Why?

MR: Today, as the industry is moving online even more so than ever, providing our customers with a simple and efficient way to apply for and be approved for a loan in real time is critical.

Lending partners with a commitment to making digital operations the core of their business align with our vision.

Working together, we are able to provide a more streamlined financial process and ultimately make purchasing a vehicle easier for all of our potential customers, especially as more Americans are looking for carbuying options where they can complete the transaction without leaving their homes.

AFN: What strategies are you investing in to grow and expand the Vroom Financial Services business powered by Chase. Where did you start and where are you now?

MR: The partnership with Chase allows for expansive credit underwriting, flexible pricing options and an enhanced documentation process, making it easier for Vroom to approve and process loans for a broader base of customers.

The goal is to make the process completely digital, enabling loans to be fully approved within a few minutes.

Previously, loan underwriting and decisioning was a very manual process, taking hours. Today, consumers can come to our app, select a car, submit a credit application and be approved for a loan in real time and in a fully automated way.

AFN: Is there a difference between marketing your preferred lenders, for example SCUSA and Chase Auto?

MR: Both organizations have committed to continuously work with us to optimize the credit decisioning and operational processes required to make the lending experience as simple and efficient as possible for our customers.

AFN: As chief revenue officer, how do you anticipate Vroom’s growth to accelerate during and in the wake of the COVID-19 crisis?

MR: We’re very fortunate that e-commerce has been at the core of our business since the company’s inception. While many other auto brands or physical dealerships struggle to adapt to a digital model, we’re operationalizing the same way we always have.

We’ve also switched to a fully contact-free delivery process, which is a key priority now for car buyers. Safety will continue to be most important as we provide consumers with the best possible  car-buying experience.