Improving customer loyalty, financing penetration in an age of digital retailing

Today’s car shoppers come to dealerships equipped with the knowledge of what they want, the financing options likely available to them and an expectation of personalized service, prompting sales and finance reps to prioritize consumer experience to capture more business.

With new-vehicle supply tight for much of the past year, dealerships have had to embrace digital retailing to meet consumers where they are, Hyundai Motor America Senior Vice President of Sales Randy Parker told Auto Finance News in May, noting nearly all Hyundai dealers offer sales through their websites and many deliver cars directly to consumers upon request. About 26% of the OEM’s total transactions are completed online, Parker added.

“For the most part, consumers are doing their research online first, getting a sense of what they’re looking for … then they will go out and look at the cars [they’ve identified],” he said, noting that by the time consumers get to the dealership, they are ready to buy.

Dealership sales and finance reps must prioritize the overall experience to capture consumers in today’s market, Parker said. “Anytime a customer walks through the door, we’ve got to do a very good job of taking care of that customer,” he said. “It’s important that dealerships recognize that consumers are out there shopping two or three cars, and chances are they’re going to buy the first one that they have [a good experience with].”

Increasing financing penetration

OEMs and captives can gain customer loyalty in sales, financing and service, Parker said. Hyundai trains sales reps to provide a thorough walkaround of the vehicle and its features at the time of purchase and follow up with consumers after they drive the vehicle home, he noted.

On the financing side, digital retailing tools allow consumers to get pre-qualified for a loan and review their terms before heading to a dealership, cutting down the time they must spend in the finance and insurance (F&I) office, Parker said, noting Hyundai is working to further streamline the F&I process.

“It’s incumbent that our website communicates well with a dealer’s digital retailing tool. We’re trying to narrow down the number of digital retailing tools that are out there to provide a seamless experience for the consumer,” Parker said.

The captive, Hyundai Capital America, also offers prepaid maintenance services that can be rolled into a consumer’s loan. Hyundai encourages service departments to communicate with customers about when their vehicle will be ready, along with any delays or other updates, Parker told AFN.

“Make sure that you have that open line of communication with the customer and provide regular status updates after the customer drops off their vehicle in the service department,” he said. “We’re working on boosting sales and service to ensure that consumers are having a really good experience.”

Prioritizing customer experience from the beginning of the sales process can help build consumer loyalty, heightening the chance consumers will opt to purchase, finance and service a vehicle with a particular brand. Hyundai Capital Services, for one, financed 76.6% of global Hyundai Motor vehicle sales in the first quarter, compared with 77.6% in 2021 and 75.9% in 2019 prior to the pandemic, according to the company’s Q1 earnings investor presentation.

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