Tricolor Auto Acceptance is leaning on its vast network of data and analytics to push up its conversion rates at its dealerships with targeted offerings to consumers.
The Dallas-based subprime lender has seen a 17% lift in conversion rates at dealerships by utilizing AI Point of Sale, an artificial intelligence-powered point-of-sale software that allows consumers to select a vehicle and customize the financing structure through a tablet application, Chief Executive Daniel Chu said during the Auto Finance Innovation Summit today.
Tricolor collects more than 100 non-conventional attributes from each of its thin- and no-file applicants, and then uses that data to identify patterns among performing borrowers in the lender’s portfolio to help drive lead generations for potential buyers, Chu said.
“We input [those data points] into our decisioning engine and, using artificial intelligence, we can identify matches in those patterns of nontraditional attributes that correlate with borrowers in our portfolio that have performed, and we can present offers to the customer,” Chu said. “This will be the next generation of our e-commerce strategy.
“Most importantly, this tablet application replaces the awkward, very undesirable negotiation process at the dealership because it allows the customer to plan a customized set of financing terms that meet their needs, on a vehicle that they desire,” Chu said.
“Every day, every transaction, every payment we process, every vehicle we purchase, our algorithms are able to get smarter. And in turn, our ability to solve these specific problems for our consumer improves,” Chu said.
Tricolor Auto Acceptance is a Community Development Financial Institution that has originated over $1 billion in auto loans to thin- and no-file Hispanic borrowers, and had a managed portfolio of about $400 million in September 2020.