<ul class="font_8"> <li> <div class="font_8">How to satisfy the "want it all" / "want it now" demographic</div></li> <li> <div class="font_8">Applying 24/7 transactional access to your strategies</div></li> <li> <div class="font_8">Communicating with consumers who don't talk on the phone</div></li> <li>Smartphone innovations on the horizon</li> </ul> [toggle title="TRANSCRIPT"] <div class="transcript-scroll-box"> 00:00Let's start introducing our males. We have Eric Halverson, head of consumer team member service or team member experience at Wells Fargo. Nathan Hecht, who's the founder and CEO of hunker. And Jim Landy, Executive Vice President, GM a lot of opportunity. Excuse me. 00:21 Why don't you just take a minute and just tell us all your core responsibilities? 00:26 Sure. The first step again, thanks for having us here today. I think this will be a good conversation. I'm Erica aalverson. I oversee a couple different groups of makeup customer and team member. Excellent. So that would be our front facing customer team, that in order to their consumer customers, as well as a strategy group are inside the analytics team, as well as our Office of the President, which is our official complaints group 00:46 and our credit bureau operations team. 00:49 Hi, thanks for having me today. Nathan hacked 00:54 Of course possibilities probably to work 00:58 as the CEO of a company 01:04 Paragon engine landing. So is titled engines gm of auto for opportunity tune as tobio company primarily, up until this point, focused on personal loans and now expanding into auto. So springboard auto, which I founded a few years ago, and we are now the online direct to consumer fraud. 01:27 Well, Welcome gentlemen, and thanks for joining us. So we're partially here today because we're companies like Amazon and even Google, Facebook and Netflix are changing the ways consumers prefer to shop. The days of you know, going on the weekend to a brick and mortar Are you know, kind of passing by, and they're replaced by 24 seven access to online retailers and direct store delivery. auto finance industry is also kind of witnessing this change in consumers. sentiment, where younger car buyers prefer to conduct most of the car buying shopping experience online. So with that in mind, my first question to you guys is how do you interface with this new type of consumer today? And how has that changed what we used to in the past? 02:21 I guess I could go first. 02:22 So I think when we're at Wells Fargo thinking about how customers want to interact with us, it's really changing the kind of the way we think about this from the very beginning. So we're looking at things like customer personas, especially on the consumer side, as well as a dealership person, and really thinking about how these different groups have different sets of variants. I think in the past, we could kind of paste them all being the same, and then realizing that we weren't really hitting the mark for any of those particular groups, a prime example of your persona from their customers as we're going through a kind of a process right now looking at why customers pay late, you know, So there's examples of different times that people pay late that maybe never go delinquent. And why might that be? So really digging into, you know, that type of understanding of our customer and figuring out how we can intercede for them, and help them through that time of trouble? Or even maybe they don't think it's a problem, hey, I don't mind paying late, you know, four or five times a year, but because that's really not the best thing for you to do financially. So how can we jump in our information and help you make a different choice? 03:29 For us, I think gradually trying to give the consumer the Amazon effect. So it's about price and transaction, 03:39 which is actually really hard to find, in general is released on multiple websites, you know, finance, retail lease, or what have you. You without essentially need to end up at a dealership at some point to consummate a transaction. So we focus on specific, actual ones that these panels actually use. things very, very simple interface. And then the feeling of completing the transaction online, we don't want to eliminate the dealership, you see our inventory concert dealers were a marketplace with more than 1000 dealers on the platform. So it's a very important component in what we do. But if the consumer does whatever to go to the store or prefers to do a simple, easy online transaction, we give them the ability to do. 04:30 So, you know, I would imagine if you look for hands in this room, how many used Amazon in the last week or two, they're building a hands on the same thing with Uber, Netflix, doordash, and so on. So that, you know, people don't buy cars every day. So it's kind of a relearning experience. And to the extent they're starting with financing, what we're really trying to do is, you know, empower that consumer with a very, you know, personalized, self directed experience. That not only looks at 05:02 the, you know, the financing, but 05:04 really the prize, which is the car. So maybe similar to what David just described, you know, allowing the current customer shop during cut paste event in will have API's for sales tax license fees, that the trading in a car will value that car form will pull the lead. So try to give them that virus or holistic view, you know, whatever wherever they want it and then give them you know, some some tools called sliders that where they can select the down payment, select their terms and really dial in the transaction that they're they're looking for. And, you know, we focus on, you know, consumers typically that have low prime credit so, you know, at the point of sale, a lot of that activity, you know, can create some anxiety and sometimes, you know, decision quality goes down a little bit so we're just trying to give them as much information and transparency you know, When they want it, give them time to digest it so they can make a better decision for our upcoming 06:06 presentation the dealer because there is a lot of talk that you know, even given this new sentence, I want to do most of the car buying from my couch. I still do what as a consumer, you still in the tactile experience of going into touching the car smelling the car looking drive the car before you buy it. So with that in mind, like how much of the Amazon effect is really like a disruptor in the carbine space? Or is it more of like, these direct to door deliveries like carvanha or somebody that will bring the car directly to you. 06:45 It's a massive disrupter. And there's there's there's still a ton of room to to continue to shake things up. I think it's it's really just a matter of time. You You can't deny that the The world is basically operating on the internet today, most of the things that we procure most of the things that we buy, our communications, everything happens on the internet. And when we speak about the car, whether it's the financial aspect or how you consume it, what you're doing with it, when you're not driving yourself and so on, is a very, very large ecosystem that has potential to be built on the internet. And it's really just as the inning I'm sure there are people who still want to go for a test drive of high percentage, and there are people who want to touch and feel and so on. But you mentioned carvanha carvanha sounds an efficient way of singing. Without you spending days, weekends, and sometimes longer and going back and forth and bring the car 07:44 to you. If you don't like it, you can you can 07:46 return it and get your next one. And we offer a similar service to and in many cases, in most cases, actually, our dealers are coming to delivery dealers are 07:55 quickly 07:56 learning what it is that customers need and one and You know, it's it's necessary at this point, in many cases to bring the vehicle to the customer, let them see it with contracts in hand. And if they don't like it, then they can return it and move on to the next one. 08:11 So, yeah, I totally agree. And you know, the millennial cohort is larger than the baby boomers the oldest, just really this other day, the oldest Millennials are 38 years old. Right. And so their references are the companies that I think I mentioned a little bit ago. And I think we all know that the stat of the the average dealerships, a customer is going to today is like 1.1. So I think that tactile experience can be delivered, literally, and through innovative ways of saying you have seven days to return it, or there's different ownership models. I think everybody in this room, wherever they are, to all of that, I think really changing the paradigm I don't think physically going into a dealer is as essential as certainly has been in the past. 08:58 And I think even from our alarm, Bank perspective, while we're not in the business of delivering cars, but certainly, you know, provide information to consumers, when they do go down that path that they can walk in and make that time spent with the dealership as little as possible or as little as they want it to be realizing that, you know, I think it depends a little bit also on the the car manufacturer, the number of models and whatnot that they offer, right? So you're trying to think about the tactile experience, if you're comparing a Tesla, say, versus a BMW, right, where you have three models versus, you know, hundreds of variations on a theme. I think it's a little bit different. But our job, I think, number one is to make sure that when you're ready to go, you're in there, you know, in and out of that experience, as much time as you really wanted them to be, whether that's an hour or so, you know, you want to touch every car and then make a decision. But at the end of the day, you still have all your financing information intact and available to 09:51 Nathan, you mentioned I use, there's still ways that this experience can be shaken up, or do you see any that are going to be happening kind of on the horizon or how You know, high potential and happening specifically? 10:03 Yes. 10:05 First of all, nobody has completely nailed the transaction itself, new car of the used car. There's still a lot of a lot of development and iteration is necessarily there. Although, obviously we're seeing, you know, faster and aggressive adoption, both on the supplier and on the on the consumer side. But sure, there's a lot of opportunity, this opportunity around service, for example, I mean, second second to purchasing vehicles, but let's just say less than fun or optimal today. 10:37 You know, we have a 10:40 job in the office where if you walk into the new car side of the story, you'll see consumers depending on what time of the day is worth sitting up on the couch, and then as the day progresses, they sort of slumped down the couch on the service side that sort of starts like this, and it just continues until they're halfway off the couch. So there's a lot of opportunity there for disruption, and it's coming in or startups. They're doing some really interesting things. And, you know, we have some some things in our product pipeline as well. At the end of the day, this has to be about an amazing experience from beginning to end, from the moment you start looking for the car for the lifetime, that you have the car, getting out of it, getting into a new one, and so on and so forth. And it's one of the largest countries in the world, the fact that we're even, it's bizarre that we're having a conversation about this, you know, what, the whole thing should just blow up and start again. And it's interesting. 11:32 You mentioned like, connecting with customers and communicating with them. So this new demographic of consumers, a lot of them, you know, don't want to talk on the phone. So do you guys have any like strategies in place to communicate with these customers in a different way? 11:48 Yeah, I think, you know, when we look at our portfolio of customers, where we have over 3 million customers and I think a couple of years ago, right, we probably would have said, you know, digital is all about, you know, us having waste. The omni channel experience, if you will, right, that we were all very hot about the customer experience side of things, which meant that we're going to have new and different ways for customers to reach out to us. I think, you know, when we were talking about the Amazon effect, I think really what that boils down to is that it's it's really about the experience, right? I think we've all talked about customer experience in an aspect of the experience that we own right? So if you're the lender, there's a customer experience. If you're a dealer, there's that experience, but now we have to look at what exactly it is the whole thing as an experienced, and how do we all work together to make that veterans important and individually for our own game? So we're, in a sense, turning the I guess, the whole experiential thing from a lender perspective on it's, you know, you're a little bit here, instead of saying, Well, hey, we need 15,000 ways, different digital ways to reach out to customers, how about we start reaching out to them, which is, you know, using digital tools, like API's and moving away from a there's lots of ways for customers to reach out to us, but shouldn't we be cultivating that? experience in saying, Hey, we have all this data that says you have customers have phones with us for X number of years, why don't we start reaching out to them when we know they're likely to want to do something different, like, you know, buy a new car, or look at paying it off, etc. So, I think for us, that's the changes instead of adding in text messaging, you know, chat box, etc, to have customers reach out to us, it's using those 13:22 things to reach out to customers first. 13:28 Right? That's, that's music to my ears. If somebody wants to deal online, you know, 100% of the time. It's, it's, you know, it's, it's faster for them, it's more convenient for them, you can do it 24 seven. And certainly from an operational perspective, you know, there's, there's less people to manage, right? There's, there's less training, and else from a technology I mean, you're all you're always improving that customer experience. We're always, you know, observing how the customer is going through your funnel and seeing where the sticking points are approaching, improving those and developing new features and so you know, how they operational Stop, keep up with that, because you know some of the challenge, right? So to the extent it can be real time and the customer is very comfortable online, that's great. 14:09 So I'm curious, like if you're changing up the way that you communicate with customers is anybody tracking specifically the preference of group of customers or a senior customer, anything like that? 14:24 chat customers, especially the least customer, which is about a third of new car sales in North America at the moment. The customer who's definitely our target customer and the customer will most easily adopt staff versus a used car or new finance. We found prefers to communicate by chat. It's just it's just a you know, instead, it's the type of consumer and what they're used to. A little bit less vulnerable, more chat, you know, when everything else that they're doing social media or dating or whatever. It's mostly not that So that's probably the preferred method of communication, you can still 15:02 pick up the phone and talk to somebody. And there's, 15:04 believe it or not still some human interaction in the world to where if you feel like, you know, being someone in person, eventually you can end up there, but 15:13 80% of all the chat. 15:16 And, you know, just further down the rabbit hole with this phone, Jimmy, I'm just gonna 15:20 say our customers tend to prefer text and respond to text probably quicker than anything else. 15:28 I think we're probably exactly opposite to being a bit more of a legacy large customer base, where we still have a lot of people wanting to talk to us. And that's for a variety of reasons, right, in different aspects of the transaction where we're talking to servicing more than anything else, or in a collection space. Right. That's much more of a human touch component. And we still have a lot of folks that are relying on I'm just talking to us in the chat. 15:52 Let's get right. 15:55 To that point, right. If we recognize that to change the just recently, the way that we go about Early Stage selection process, right, you know, looking at before people can get to that 50 day mark, and not just calling folks, you know, sending out the messages that really speak to Hey, you know, we noticed you haven't made your payment, and then adding some extra value to that, you know, with links to, you know, some frequently asked questions, you know, here's what's gonna happen if you don't take action by these certain dates, right? So we're trying to set that call up, if we actually do need to speak to somebody from a, you know, you've been, you've had a chance to get educated before we have to talk so that it makes it a little less onerous, because you're right, nobody wants to talk to a collector, if we can figure out a way to soften that conversation with information and education. And that's our job. One of 16:36 the thing I'd add on this just in communication, know that a lot of platforms and introduce AI, you know, virtual communications and stuff like that, I'd say that, again, from what we've seen, we've actually tested two or three different SaaS platforms over the last year and a half or so. That's actually something that consumers we found, don't like, they very quickly can pick up on whether they're talking Talking to a human on the other end rather than talking to a machine. And there's a lot of frustration, you know, when they feel like they need an exact answer that can't be answered or an answer that's relevant specifically to them. So that's actually just an interesting observation that they, you know, they'll they'll answer you when they feel like there's someone really many, many times we've seen the last question that's sort of off base to see if you can respond to it, or you're not programmed responses. Which is interesting. Yeah. And, and, you know, 17:26 now that we're kind of separate from websites and customers like don't, is there anything that you guys are putting on your website or smartphone applications to cater to, you know, demographic that does like to have, you know, a sleep website where they do just add to cart and, you know, 17:47 just say constantly, I mean, you're constantly looking at how the customers going through your funnel, developing either new features, or improving some of the features. Yeah, so you know, I A couple years ago, I wonder if I had a feature list was going to shrink, right and come to the end, you're never there. It grows a lot faster than shrinks. So just never ending things in your process. 18:13 And just go further with that, like, as you change iterations of your website, like, what are you noticing, in the way consumers have reacted to these changes? Before, you know better or worse? 18:27 You know, you look at the data closely and see where there's engagement and you know, where you know, what touch points are being used versus abandoned. It's honestly very, very hard to figure out the right to end up in the right place, if you will. And even along the way, it's very hard. You'll make one small change and suddenly, you know, you'll see consumer fall off and then you're like, is it actually that that's causing it? Maybe it's seasonal? You know, maybe there was something wrong with our ad copy that might be affected and it's really hard to pin point exactly, you know the cause and effect. But in general, it's, I would say the simpler, the easier, the faster. In many ways, the less information, the better. The more you layer goes on, the more you're creating areas for confusion and questions and then fall off. And that's something we learned as a, as a tech company also, especially as it relates to a high commitment product, like like a vehicle. You're just as they're coming in to begin with, maybe within an unknown state. And the same as it relates to finance specifically. You know, we battle with, you know, should we show money there? As an example, does the average consumer go with money factories, should we list rebates and incentives, and delete the need for the consumer, you know, how we ultimately come to this price, and then you do some AV testing where you have versions of the app and showing versions of the app that don't and you sort of float forward the best engagement is but Ultimately, if you can, the mantras kiss, keep it simple, stupid, that 20:08 the closer you stick to that, that Rafi ultimately are, 20:11 but I think you hit the nail on the head with, you know what I'm going to just call the failed path and record you. I think, especially as a legacy organization, right? You know, we put together a project and we roll something out and pat ourselves on the back of the world on something cool. And then you do some testing to find out, maybe you missed the mark sometimes because it just took too long for that thing to get to the market. But I think you're 20:32 what we're going through is exactly what you described. Nathan is 20:35 really trying to find the sweet spots where you engage with somebody that works, but then realizing that that's not going to last right? I think the technology is changing fast enough, or whatever is working today is going to have to evolve and you're gonna have to stay evolving with it. And you can only do that the digital experience. 20:53 Yeah, I agree with all that. The only thing I would add from a caller O'Brien perspective is trying to validate, you know, information you otherwise would would need from the customer, primarily proof of income. So they extended every variable to leverage third party data sources to, you know, clear whatever conditions you otherwise would would need from the customer. 21:16 This is an interesting because 21:17 like I said, just fail 21:18 fast models seems to be at odds in less information, better technology in auto finance, where, you know, you only really people don't buy cars every day like uses gym so you'll kind of with consumers get one maybe two shots. So how do you balance that? This kind of like tech view and you know, what kind of auto living kind of demands in terms of how much information you give? 21:45 Yeah, I mean, I, you know, it's we're 21:48 probably a little bit different than wells in terms of there's a lot of personas and then 3 million customer base where they have a luxury of focusing, you know, more on on the customer, that that's online, and you know, Part perspective is to be as transparent as we possibly can, and to provide him every, you know, citizenship information that, that they're going to need to make a better decision. And what we've seen is, you know, that that does result in a better outcome in terms of low performance giving the same attributes to the indirect channel. You know, we've seen significantly better performance taking that approach. 22:27 Yeah, and I think I would add to that, you know, with our welcome call process and welcome. Welcome overall process includes a package, a phone call and the messages as well, I think it speaks to that of, you know, really trying to break the transaction down into all of its components and make, you know, there's aftermarket products and until alone, that we're selling those out for consumers, they can understand exactly what you know, they maybe they don't remember everything they signed up for, right. We're trying to do much more than education even after the sale just as a reminder and improve that engagement overall. 22:58 I mean, another example would be You know, we offer the customer a gap in the process. And you know, in digital with the sale prices and payment until tax, all that all that stuff, they get to a screen, they see gap, they see the features, they can select it, it'll go into the entire, you know, call it financial stack and see what the impact of their payment is. They can unclick it just as easy and move on. Right. 23:22 So just to go a little further, you know, what are some examples of these past failures that you guys that you've noticed, like what lessons have you gleaned from from those failures? 23:33 to respond to them quickly? 23:36 I think the market tells you things literally every day. 23:41 But your your you 23:42 need to be listening and and willing to change very quickly. And it's, you know, it's it's necessary. There is no other way about it and it's easy to get comfortable and it's it's hard to consistently iterate and constantly keep up with consumer demands. The market tells you what they like and what they don't like, really, really quick. And so if you're attuned to it, 24:07 and willing, then you'll you'll hopefully get a good result. 24:12 And that's, you know, you could have sitting around a conference room trying to anticipate what the customer wants to build something and take it to the market as a customer. So I think it's, you know, as fast as you can get something to market, you know, you have to balance, you know, some of the room, maybe from the legal department would want it to be a little bit more perfect than that. You know, that it might be, but you know, absolutely, the customer is gonna tell you exactly what feedback you're looking for. 24:40 And you're not using it 24:44 as an indicator, right. 24:46 I think just to pick up on something you said, Jim, I think I've been in a lot of those meetings to where you had 50 of the voice of the customer in the room, and then you look around the room and go well, we all look alike. We're all socioeconomically the same our experience. As x and you design something for that x group, because if we're all talking together, and then we roll it out and go, how do we how are we so wrong? Right? I think that's, you know, the fact that fail fast and other races, get it out of that mindset, get out of that place and get in front of customers and then be able to see what they say. 25:18 Right? And moving forward. What kind of tools do you guys use will use to stay competitive in this kind of sales and marketing space, like data 25:27 mining something else? 25:34 I think, you know, so we were elated, you know, really excited about opportunity. And, you know, is there's, there's 300 store locations. And so it's interesting to be able to merchandise, you know, the point of sale, that's, that's new. Also, they have a quite large database of customers. So it's not 3 million. We're looking at a customer's journey. Through the existing process and trying to figure out, you know, when would be a good time to introduce an auto loan to them, you know, and just always try to find other data sources that can help you understand, you know, that customer who's online, you know, which of those customers has the intent to actually transact. 26:23 I mean, our tech stack is, is very deep, and we need access to a ton of data on a variety of different levels with a bunch of different sources. But I would say there's fewer tools probably the better once you find the ones that are dependable and ultimately giving you a good result managing different platforms, managing too many relationships at any given time. It's just it equals overhead. And you know, you make one change affects a bunch of different things and so on. So we try to keep you try them. And sometimes it takes time to get through certain members and stuff. certain relationships and partnerships will come and go. 27:04 But ultimately, I think the feeling better for us. 27:09 And I think for us, going back together a large customer base, we have an overall the number of customers we have at Wells Fargo or any of our other large banks, you know, friends are probably thinking the same way. How do we use the data that we already had better or, you know, newer companies are currently desperate for data, we have lots of it. And I don't think we use it nearly as effectively as we could. So for us in the future really is about connecting the entire customer experience if you're a repeat auto, you know, finance or, you know, a customer of Wells Fargo. And we should already be able to predict behaviors based off of how often done loans with us where the process you know, you are, are usually at at you know, so if you're at 2.1, you're kind of buyer and seller of you know, car loans based off of path dates, right? Well, then we should be interceding somewhere along that path rate is at the halfway mark and start talking about what your transitions are in one of these cases. You know, I'm like, I like going to the car dealership I've been having there all the time, I'm thinking about buying three cars a year, on average. So, you know, if somebody, you know, jumped on that, right, they would realize it, well, hey, maybe we should be sending some more marketing information to this guy who likes going there and continually buys and sells a lot of cars. We have lots of customers like that. And we don't do really much with them today, when it comes to being predictively. You know, sending out three calls, you know, opportunities for, you know, shared marketing opportunities with dealers, etc. So there's a lot that we have in kind of on the books that when it comes to ideas or connecting our customers, you know, throughout that process, including our new investors too. 28:38 Great in general, do you think or what segment of the market do you think is the most underserved, that can be better served through this through the lens of the Amazon effect? 28:51 millennials, probably 28:55 just a younger generation Americans that are you know, Moving around and Uber and, and, and scooters and, and all sorts of things that's a, that's a, that's a prime mark that market needs to be captured or they're going to be lost or a big portion of them are going to be lost. And I can almost guarantee you that they are not going to go through the experience of their parents went through a period is JC Penney care, Sears is over. That's way behind us. So if we can give them an experience that suits them. There's a massive dresses on the market there at the end of the day to take away the freedom of, of, of car ownership. Anti American, you know, so I saw the CEO of Hoover, on Thursday or Friday describing the deep bumping of the car where he sort of segmented the different things that we do with our cars. I don't think you can D bundle the drive down from LA to San Diego. You know, binding car and module you will want that. And the only question is again, what is the experience like to get it? What do they do with it when they have it? How do they sort of set it? How do they finances? What does it cost them? And what does that whole experience feel like throughout and the change is now it needs to be now. 30:23 We do those car seats when you move from point A to point z. 30:28 I think you know, there's I agree with the millennials the bigger opportunity. 30:34 And you know, affordability is kind of an issue is I think we've all been reading about it as it relates to new cars. You have 4 million ish cars coming off lease that are good quality cars. And so I think it's, you know, it's about trying to figure out different leadership models for that, and that segment the cars and trying to fit, you know, solutions to into the customer, maybe, maybe it's an auto lease, you know, that's that seems to be leading up to From a product perspective that is trying to, to solve, 31:05 solve that need in a market where, you know, prices are increasing. 31:10 And I think the other thing I would add to that is, what do you think about all these different experiences we're talking about? Right? So traditional dealership, car buying services, etc, right subscriptions? I think one of the things that we often do is provide more education, of course, millennials and younger, right who have more experience, but that's our opportunity to have experience with this, then an older buyer segments that would only think of a dealership, it's something that you know, as a auto lender, right, then we can really help that group understand the differences between all these models, right, so that you're not having to search a whole bunch of different websites to find all this information individually. Right. So I think that's the thing about underserving. It's a whole new level of education and interaction with the customer that just didn't exist 510 15 years ago. 31:55 So then, finally, 32:00 Never never bought a car. 32:02 How? And I'm not interested in buying a car, or I don't know, how do you how do you get this information about financing to 32:16 messaging in? First of all, where do you Where do you first discover car ownership? how its presented to you what the message is, is a very, very big part of it. A huge part of that. And if you see the first time and it doesn't, it doesn't evoke an emotional response doesn't make you think twice. Chances are that, you know, you'll be missed. But if done correctly, then and where you're at what type of message you're expecting, then there's a good chance that that it'll engage you and he'll say, hey, actually, this is you know, this is great. A car is very convenient, and you know, it's super affordable. You can lease a car today for 150 bucks a month with a little bit of money doing signing, and you can get out of it quickly. You can insure it for something, you know, minimal, but you didn't know that or maybe you might not have even thought about it. And when you start to look through the websites that are out there today, there's so much broken information in so many different places to just effectively put everything in one place where you can see a price where you feel comfortable with the vendor, where the transaction can be completed in the way that you're used to doing it, then there's a good chance that you know, that you'll go through with it. 33:30 And I think you hit the nail on the head if we go back to that, you know, commentary about, you know, generational differences right between if you're a millennial, or maybe even a you know, below that in age group rise in our generation, you would have probably gone to your parents, right and ask them, you know, hey, I'm thinking about buying a car, you know, what experience would you need? So right there, you're off on the wrong foot right with that group who is desirous for more information that wants to facts once a you know, a large amount of kind of car buying options available to them, your parents aren't going to happen right? And so I think that's really again, the difference for us if, you know, as soon as you start finding that somebody is slightly interested in the process, how you start delivering messages that help them lead down to that path, ultimately making a decision to buy. 34:14 You, I think the labels gonna come to you, right, that little thing in your pocket, you're gonna pull it out and deliver carbon. So I think, you know, it's incredibly expensive to drive traffic in the auto space rather than space. So trying to have, you know, a great user experience, obviously, is key. And to the extent you can differentiate rather turn on, you know, different ownership models. 34:40 So we're, we're kind of getting close to time, but the audience has a couple of questions. I want to kind of divert to that. So forgive me. 34:51 Maybe these LA to San Diego experiences that you've just tried to convincingly become too cost prohibitive for a wide swath of the market. True. To false, and then what prevents car dealership from becoming too cost prohibitive 35:05 in the sharing economy, as the share continues to balloon, 35:09 so, gas in the West Coast is one third more expensive is than it is on the east coast where I'm from. So that's true. That's true. If you want the true or false it can get expensive at $4 a gallon, 35:22 maybe an Eevee as an option, what was 35:28 what prevents car ownership from becoming too cost prohibitive and as the shared 35:32 economy continues to live, 35:35 low rates will cause it to be less prohibitive, cost prohibitive. Number one, as it relates to finance for sure that you are actually paying for it, residual values and how they sort of use the car market all sets the new labor market. So those are things that are sort of in flux. It depends on what the overall economy is looking like, you know, supply demand and so on and so forth from New And Used, but 35:57 those dynamics they move 36:00 Very few extreme, you know, peaks and troughs, you had them, you know, we had the last trough during financial crisis is 10 years later. And things have sort of been steady and increasing incrementally over the last couple years. So I don't think that's much of a concern. And then you can sort of add in, you know, what median incomes look like and so on, and where you live when your overall, you know, expenses look like but that should not affect whether or not you own or don't own a car. It's like everything else. For some people that may feel like splurging, but on average is probably just a necessity. 36:34 Right, Eric kind of worked for you have to wonder is well, Wells Fargo Bank wind seeking in Amazon's effect, and do these efforts filtered down to the auto finance unit? 36:49 Well, I think you know, I always think of the Amazon effect of is back to what we've been talking about from an experiential standpoint. I think he added the other part that we really haven't talked much about, but I I think other folks have talked about today is the fact that prices no longer look the only thing that drives people to make a choice. And the fact that, you know, people are paying a premium, if you will, for experience, I don't know that we've fully understood exactly what that's going to mean for us yet, when it comes to how we interact with customers. But we do know that, you know, customers are seeking those positive experiences. And for us, it's how do we capture that in or think about these personas we talked about earlier? How do we, you know, I guess, wicker in, you know, what somebody's willing to pay for, you know, some certain specialized services that perhaps we don't even offer today, and or interactions with dealers where we can improve a process, but there's an expense to that, would you be willing to pay for that expensive? How much would you be willing to pay? So I think if anything else, you know, for us, the Amazon effect is all about challenging our current ways of thinking when it comes to the customer experience. All right, 37:53 thanks. 37:55 Another question may, maybe June you can start off on this one. What percentage of consumers Whereas in this demographic today do you think would prefer a complete like hundred percent self service experience when it comes to financing or 38:08 what? 38:10 What's like the this segment that prefers 38:17 and the question is what they prefer 100% online experience 38:20 self service outside experience so they're just starting to finish online. I don't have to go to a dealership to talk to human being. 38:29 You know, it's probably 38:32 it's a huge market, right? There's only 60 million cars sold every year. So I kind of think like in wine terms, there's people who like, you know, Chardonnay, people like Cabernet. So not everybody's gonna like the same, same wine certainly every day. Sometimes it's hard, sometimes it's cold. So I think you know, somebody in the city might have an entirely different approach than somebody and then a second tier city, their mind to use color, they may have a hybrid propensity to want to kick the tire, literally. Maybe they're buying a specialty car. So I think it really depends on the use case of the consumer. 39:12 So, committing just a little bit to any of you really think car subscriptions are anything more than like, overpriced, least offerings. 39:23 Then why why bother with it like from a lender's perspective, if it only 39:27 ends for the consumer, like this treadmill in 39:35 the audience know that word? crowds? Careful. I know he answered that. I don't think it's something that's very interesting. It's yet to be determined as to how it plays out. But it's it's very interesting. And sometimes we look up and say, you know, how are they doing it? The numbers just don't seem to make sense or, you know, all the sort of variables that go into it, but as a category 40:00 It's an interesting category. 40:04 Thanks for Yeah, I was just gonna say I think, you know, it's, it's from my perspective, you know what duration like looking at, right? Is this a short term transaction where you're trying to make 2000 $3,000 gross on a card? Or is this a customer that you're looking at really trying to have some lifetime value? I think we all know that fixed offices 55% of dealers profit, so you want that customer coming back. And social media is a big driver of, you know, just bringing customers in, in general. So if you have a happy customer, you're more likely to get more customers. So I think, you know, to the extent that you can look at your profitability timing a little bit differently from a subscription perspective. I think that I could open up interesting opportunities where you're not on that date right now. Right, you can get in a very low basis and pay a subscription fee and perhaps that does open up different options for you to be able to buy out in 12 months and 18 months. So there's a lot of opportunity For somebody who's a little bit more innovative, and looking at 41:05 things differently, 41:07 I think you add to that the 41:10 lifecycle of somebody that buys and sells a car over a period of time, right? That I look at a subscription service more for my own personal viewpoint as a loyalty, you know, play, right. You know, if you like, my type of car, right? You know, maybe you start out as somebody that you know, is in a subscription service, I think you morph to the, if you want to call it the suburban family lifestyle, right? The idea that this is pretty do with all the Carson's right? I can't imagine myself, you know, like, it's all grown up now. But back in the day, I was gonna have this car for two weeks and take all the crap out, put it in another car for a couple weeks. Right? Let's think through that a little bit, right? The likelihood of you doing that for that period of your life, you know, if you choose that, like being right is not so great. But then again, maybe once those kids now leave, if you're not meeting our premium car buyer, Dave, I'm not really sure if I bought this Porsche or that Porsche or Regardless if you like, right, I think ads has been appealed for different aspects of, of the market, but not broad based. 42:07 Alright, I have one more question for you. Yes. 42:11 All of you obviously come from, you know, very spaces in the car by auto lending experience. So we have been one, one initiative that we've undertaken that's been the most successful in communicating to this demographic that stands on effect. 42:37 You know, enjoy. 42:40 Certainly direct space, one of the things direct allows you to do is not just a dealer purchase. And so you know, we looked at the market and saw that the the private party transaction space was pretty underserved and it's hard to get data there is probably somewhere between 11 and 15 million cars sold a year. that are currently the borrower tends to skew towards local prime customer. So we spent a lot of time trying to, you know, bring that experience as online as possible and as painless as possible. You know, mentioned people buy cars every day, they certainly don't want to go to the DMV, you know, so removing, you know, that component, and then handling the, the the flow of funds for both the buyer and the seller, and just, you know, try to take as much pain as you can. Because 43:28 I think the initiative is, for us at least has been education, the customer, customer base that we speak to, in just sort of putting out information that's relevant in a very, very simple form. And then giving them the tools to actually use that information to complete the transaction and to do it effectively. So it's really important, again, just because there's so much information available from so many different sources, and then you come to, you know, even advertisements we've talked about this internally in automotive advertisements Today Oh, there no probably understatement, but it's they're misleading. You know, I personally have experienced or went to a dealership based off of an ad for a specific brand. And then the dealer says no, no, you know, this fine print this be the speed reader, you know, it's subject to this, and then the other thing and so on. So just getting information that's actually relevant, getting information that's specific to you. And being that the financial the finance side of this is so it's so important that it's such a big component, you know, what do you actually qualify for? And what is it the difference between tier one and tier nine? And, you know, and how that rate will affect you and so 44:37 on. Consumers walk into dealerships all the time, and the information 44:41 is sometimes hard to come by or it's fed in a way that maybe is not as you know, clear as it could be, should be so in the first condition is just sort of get that out. 44:54 And it's a probably Lastly, similar to what these guys have also said, education is probably the thing I think we've Feel like we can do the best and then improve at the most. And then I think secondly, went back to the holistic experience part. Just because we might have focused on being a lender in the past How can we actually deliver more value more services to do things like connecting with dmvs and try to take some of that stress and friction out of the process in for for customers so that they don't feel like they have to go figure all that out and 45:23 get played off. So please join 45:24 me in thanking our panelists. </div> [/toggle]
