Is your strategy to capture more loans going the distance? Are the right pieces in place to support a full press ahead when it comes to going after all the business? Many credit unions have a plan to capture more loans, but it falls short. Bridging the gap between rates, member messaging and optimizing dealership relationships will get your credit union where it needs to go.
Generating results takes planning. Let’s plan our strategy for auto loan growth. Here’s a list of what is needed: Website … check, members … check, area dealerships and competitive rates … check, check. Ready? Auto loan growth is at the highest it has been in more than a decade, so don’t be just satisfied with what comes through the door; get hungry for more. Are you?
If you want more, let’s discuss what your plan is to drive business to the next level. The foundation of your program has been built. You may have great rates, along with decent loan activity coming in from dealerships, but are you missing out on more business? Are you really working with your dealers to drive leads to them and have business return to you?
Here’s what you will need to do to take your auto loan growth initiatives to the next level. It’s called preferred dealer networks. Whether you have a program that is direct or indirect or both, you will still need to build and maintain these dealer relationships to distance yourselves from your competition.
Having the right support is critical to maintaining your credit union’s preferred dealer network. In most instances, it is not good enough to expect dealers to push volume back to you because you provide the best rates or service. As you probably already know, dealers for the most part have that very same option with other lenders. How are you going to be different? How are you going to build or strengthen your existing relationship with your preferred dealer network?
It sounds complicated, but in reality, it is not as cumbersome as you think. You just need to put yourself in the dealer’s position and address what motivates them … “What is in it for me?” What if you were able to help them by bringing more customers into their showroom and helping them sell more vehicles? That would definitely get their attention and compel them to look at you differently while positively distancing your credit union from your competition.
Some credit unions have attempted to do this by listing their preferred dealers or providing a link to the dealers’ homepage directly from the credit union’s website. The problem is, the credit union is promoting the dealers without getting anything in return, and while removing themselves from the car shopping process with their members. What if you could have the best of both worlds by capturing leads from your membership as to who is in the market to purchase a car, while building a controlled environment for your members to shop for their next car and collaborating with your list of preferred dealers.
A credit union doesn’t have to go it alone in building and servicing their network of dealers. Partnering to help build this resource is a viable option. Once in place, it will be your best resource for continuous loan growth. Here’s why: If dealerships are selling more vehicles because a credit union is promoting them, they will be endorsing your loans in return.
A credit union with an auto buying resource is in a very powerful position to provide valuable leads to their preferred dealership network. Building these relationships solidifies a strong business foundation a credit union needs for continuous and solid auto loan growth. Essentially what you are doing is moving from just engaging your members to engaging your members, and at the same time, engaging and driving members to your preferred dealer network. This closes the sales loop while putting your credit union in greater control of its future.
Remember, members are hungry for this information. Ninety-seven percent of car buyers begin their vehicle search online and spend more than 14 hours over four months researching and shopping — keep them on your site, with the information they need. This is even more prevalent with millennials and will only continue to become more prominent with each passing month. If you do not make any adjustments to your strategy, why would the outcome be any different? Don’t look back and wonder what you could have done differently. Take a more aggressive approach and lead your credit union on a new successful path!
Robert O’Hara is vice president of strategic alliances GrooveCar and CU Xpress Lease. He can be reached at 631-454-7500 Ext. 124 or firstname.lastname@example.org.