When it comes to the term “Combo Product”, while there are a wide range of products and philosophies around the strategy, there are a few things that seem to be universal.
First, is that a combo product isn’t simply bundling several products together on a menu. While that is one way to sell F&I products, the combo strategy involves one provider offering a bundle of their branded products, and for the sale of those products to happen on a single contract. Across the board, our respondents to this month’s roundup agreed that the benefits of having a single contract for a customer to sign – getting them in and out of the F&I office faster – leads to higher sales volumes and a higher profit on the items sold. They did note that, at times, it can backfire however. If a customer doesn’t see the value of even one product in a bundle, it can kill the sale of the entire contract. But for the most part, our industry experts agreed that this is a powerful sales strategy.
Second, what was interesting to note was that while there were some common products across the board – most providers we talked to started with a base of a vehicle service contract, and built their combo offering from there – the products that were offered did have some variety. Roadside assistance, dent and ding coverage and key replacement were three of the most cited products. Tire and wheel and appearance protection came in a close second, and most providers offered an average of three to four products in their combo packages.
One thing several providers mentioned is that they are always working with agents and dealers to bundle products together in new ways, but that state and federal regulations are something they keep a very close eye on. Key replacement, for example, is often in bundles today, but one provider noted that it’s possible that will be classified as an insurance product in some states in the future, which would disallow it from being included in combo packages.
If you are looking for insight into the exploded market for combo products, click on the companies below to hear their thoughts about the category, the pros and cons of selling combo packages, and where they see it evolving next.
Combo Product Roundup
American Guardian Warranty Services (AGWS)
American Guardian Warranty Services (AGWS) Jon Anderson, SVP, Sales and Marketing
How do you define a "combo product"?
Combo appearance packages offer extreme value and represent the most relevant offering to a new vehicle or certified pre-owned customer. Customers love the appearance of new or certified pre-owned vehicle and they want to protect it. They give an F&I Manager the versatility to offer the appearance protection benefits most relatable to the customer.
GSFS Group
GSFS Group Alan Bond, VP, National Sales
How do you define a "combo product"?
To me, combo product means multiple products that have been combined into, in essence, one product or at least one form.
Innovative Aftermarket Systems (IAS)
Innovative Aftermarket Systems (IAS) Jeff Jagoe, SVP, Sales and Marketing
How do you define a "combo product"?
More of a concept than a product, IAS offers dealers the ability to bundle two or more IAS F&I products as a packaged deal on a single form with a single price. This completely customizable program, called Multi-Shield, utilizes a mix and match approach to meet dealership and customer needs and the perfect F&I price point.
National Auto Care Corp. (NAC)
National Auto Care Corp. (NAC) Curt Johnson, Senior Risk, Product & Compliance Manager
How do you define a "combo product"?
In our industry, when multiple programs are combined into one potentially easier-to-sell product it’s referred to as a “combo”. Typically, combos have a service agreement product base, with non-mechanically related vehicle services incorporated – like tire and wheel or paintless dent repair – to add value for the consumer and ensure F&I offers a fuller range of aftermarket products to each customer.
National Automotive Experts (NAE)
National Automotive Experts (NAE) Kelly Price, President
How do you define a "combo product"?
To me, it would be taking any combo of several offerings, and creating different opportunities based on needs of the dealer. We focus mainly on reinsurance for dealers, and we try to combine products that are good for reinsurance and high value to the customer.
RoadVantage
RoadVantage Randy Ross, SVP, Sales
How do you define a "combo product"?
Typically, a combo product, or a bundled product, includes three or more ancillary components offered together in a single, branded package.
Safe-Guard Products International LLC
Safe-Guard Products International LLC Dave Duncan, President
How do you define a "combo product"?
A combo product takes existing ancillary F&I products and packages the benefits into one product, sold on one form.
Wise F&I
Wise F&I Matthew Croak, President
How do you define a "combo product"?
A “combo product” typically includes coverage benefits of multiple ancillary products in a single contract. These multiple coverage benefits may be offered in several formats including bundled, à la carte or a combination of both. A dealer’s ability to offer a single contract with multiple coverage benefit options allows for a more personalized solution and enhanced value to the customer, as well as additional profit opportunities for the dealer.
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