Putting the Experience Into Auto Finance
Why is it that auto finance isn’t more about the auto?
Let me explain the question, which I have been thinking about for some time now. The “cool” part of auto finance is the auto. It is the physical element, the reason why the borrower is borrowing, the focus of the transaction. Yet, there is not an auto finance company in America — and that includes every captive — that ties its ongoing relationship with the consumer to the auto.
My American Honda Finance Co. lease is coming to end this month. I think this is my fifth lease with Honda, which must make me one of AHF’s more long-standing customers. But how loyal am I?
You might think, he keeps taking new Hondas and new AHF leases, so he must be “satisfied” with his Honda experience. Well, sort of.
I am certainly “satisfied” with my AHF experiences in that I am not dissatisfied with it. It has been fine. Like taking a morning vitamin is fine.
But I think back to all the years of interaction with American Honda Finance and never once, not once, did AHF communicate anything with me about the auto outside of a picture of the vehicle I leased on my monthly bill and communiques about the lease end process. This last lease was a Honda Pilot — how about something about the newly overhauled 2016 Pilot? And I don’t mean to sell me on it. AHF can create “experience” around the Pilot. “You’re a Pilot person — there are cool things that happen around the Pilot.” Do a Twitter search for “Honda Pilot” and you will find a whole mess of tweets on this or that about Pilots. There is “community” around the Pilot. But there is nothing from AHF to even remotely cultivate that “community.”
Don’t dismiss the idea out of hand. Creating that community would make me think of AHF as something more than just a monthly biller, but as “cultivator of experience,” which seeds a deeper brand relationship.
Last week, I was in Austin, Texas, at the Digital Banking Summit. There, a friend of mine spoke, Jamie Armistead, head of digital channels, Bank of the West. Jamie is working to literally revolutionize Bank of the West, a West Coast bank that often has to fight for share against far larger banks. Jamie highlighted Venmo. If you don’t know about Venmo, you should. You can just ask anyone between the ages of 18 and 30 — they’ll tell you everything you need to know about it.
Venmo did something unique: it built a social network around a payments system. The cool thing about Venmo is not paying for something, but letting your network know what you paid for. This has made Venmo something way more than a payments platform, but a provider of “payments experience.” You better believe that creates one heck of a sticky financial arrangement.
There is nothing like this in auto, and I refuse to allow for the “auto finance is different” excuse. That’s because the auto — people love, love, love cars! — can transform auto finance into the auto finance experience. It’s time an auto finance company took a stab at being more than just a source of dollars. The experience will be worth it.
