Most auto finance companies have been using scorecards to rank their dealer customers for years. Lenders use the scorecards to evaluate the quantity and quality of loan applications that are being submitted by dealers, as a means of gauging quality assurance and ensuring quality control over the types of loans in the lender’s pipeline and portfolio.
There have also been tremendous strides in analyzing consumers, to better understand their patterns and behaviors in order to predict if and when they may stop making their loan payments or when they might be in the market for a new vehicle.
But there is a third category of data-mining and measurement that is being overlooked, and should not be: customer satisfaction. Ask an executive at any auto lending organization who its customer is and, invariably, the executive will tell you that it is the dealer, not the consumer.
While lenders are busy analyzing the look-to-book ratios of their dealer-customers, they may be overlooking how satisfied the dealers are with their performance. An article I read recently pointed out the difference between soliciting feedback from customers and measuring customer satisfaction.
The people who provide feedback are generally very happy or very unhappy. They represent opposing ends of the satisfaction spectrum and do not provide an accurate analysis of a marketplace’s general satisfaction with a company. Randomly and proactively measuring customer satisfaction acts as a much better barometer of a company’s placement in the industrial hierarchy.
From the article: “Customer satisfaction, when measured properly, predicts sales, loyalty, and recommendations. Research from the University of Michigan shows that customer satisfaction can even help predict stock prices.”
Rather than looking at car sale numbers or analyzing past month’s pipelines, lenders can get a better assessment of their sales funnels by applying some basic information-gathering techniques to their customer communications.
