A lender’s ability to establish a “productive” relationship with a dealer is now key to garnering dealer satisfaction, said Jim Houston, senior director of the auto finance practice at J.D. Power. More so than in the past when speed of funding was the “king” of priorities, he added.
Fewer than half of dealers receive consistent sales rep calls or visits from their lender partner, which can boost overall satisfaction by as much as 68 points and 75 points, respectively, on a 1,000-point scale, according to J.D. Power’s 2016 U.S. Dealer Financing Satisfaction Study, released Monday.
Lenders need to focus their attention on establishing better communication with their dealer partners or they are going to lose business, Houston told Auto Finance News.
When satisfaction scores are 900 points or higher, 62% of dealers say they are likely to increase the amount of business they send to the lender over the next year, according to the study. Likewise, when satisfaction falls between 800 and 889, only 37% of dealers indicate they will send business to that lender, and only 22% will send business to the lender when satisfaction dips to between 700 and 799.
Most lenders are utilizing technology now to enhance their speed of funding, and there aren’t many in the space who have glitches or issues with their dealer funding process anymore, Houston said. Therefore, more pressure is put on lenders to formulate a relationship with the dealer to gain a competitive advantage, which includes improving their communication channels.
“I think communication is really providing the dealer the information they need to do their day-to-day job and having that information available in multiple channels — whether it’s through Dealertrack or RouteOne, email or text, phone or in person,” he said.
Lenders should consistently analyze the dealer relationship from a dealer relationship manager perspective — including making sure the lender “is built around what the dealer wants and needs,” as well as “making visits to the dealership that are productive, not just so the lender can say, ‘OK, we stopped by the store,’” Houston said.
Additionally, the study also showed that Mercedes-Benz Financial Services ranked highest for the second consecutive year in both the prime retail credit segment and retail leasing segment with dealer financing satisfaction rankings of 961 and 982, respectively, on a 1,000-point scale. Following in the rankings is BMW Financial Services with a score of 959 in the prime retail credit segment, and 958 in the retail leasing segment.
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