Today, we almost take online technology for granted as a part of a typical auto transaction. It wasn't always that way, of course. There was once (and still may be) an adversarial relationship between automotive retail, finance and technology – a conflict that grew to the point where operators adopted low-tech philosophies of business, delaying the application of efficiency models and fighting against the idea that technology would benefit business – not replace it. Eventually, reality evolved: Businesses began to focus on serving their digital customers and provide existing customers with digital tools that made loan management easier. Today, most apply technology strategically, investing in digital tools and nurturing the idea that every business has two storefronts: Physical and digital. Many are progressive in their approach to technology and to the changing nature of the business.

Back to the F&I Future

There's just one catch. The process of “F&I” remains at loggerheads with the idea of technology-driven efficiencies and improved experiences – things consumers are demanding. A recent Kelley Blue Book survey shows that of those buyers who went through an electronic F&I experience, 74% were satisfied with the experience, compared to the 54% who enjoyed the traditional experience. Of those surveyed, 40% said the most frustrating aspects of the car buying process had to do with finance: Filling out paperwork/contracts (27%) and applying for financing (13%).

As a result, consumers are looking elsewhere for vehicle loans. Dissatisfied with the dealership experience, the emerging preference is to have financing complete prior to the showroom visit. Of course, that's not new. In fact, it's a staple of credit union business. What is new, however, is that consumers want a fast, efficient and mobile experience as well as competitive rates. One could, indeed, read that the dissatisfaction with dealership F&I is indicative of their frustration with traditional bank and credit union processes.

So why – or what – is it about the funding process that pains buyers so? Ultimately, it's frustration over the amount of time invested and where they must spend that time. It's also displeasure over the way the process works. Customers are happy when they show up, yet walk away dissatisfied and angry, especially from dealerships. There's a better way to provide a mobile experience that satisfies consumers and empowers them as well.

Technology at the Right Time and Place

Meeting borrower expectations around customer service is not easy in this fast-paced, technology-oriented world. It takes the application of technology at the right time in a process designed to meet customer expectations of transparency and the immediacy of information. Doing that is tough, and it's certainly no flash in the pan. It's complicated and intimidating: There are possibly more moving parts to the process of arranging financing for a car sale than there are in a typical autonomous vehicle. And that's not all. Add to that a fear of change across the staff: Your ace team is in the day-to-day, and they see changes in process and technology as career-enders, not expanders. What many don't see is that changing the process through the application of technology will help them avoid a career-ending scenario where sales dry up and profits shrink.

At SpringboardAuto, we believe that effective technology includes the development of a right-time, right-place finance process that empowers all stakeholders: Customer, dealer and lender. Over the next five years, the question won't so much be whether or not you're using AI to drive your business, but if you've evolved your team and your processes in order to integrate available technology, and create a better approach to vehicle finance. The technology is here. The only question is whether you decide to get in and take the ride.

Jim Landy is CEO and Founder of SpringboardAuto. He can be contacted at 949-945-4947 or [email protected].