Let’s just jump right into this subject of technology. We can have discussions from here to eternity about new solutions that provide real-time reports covering everything from product production to F&I performance and other items in between, but at the forefront of what is most important and being used by the retail industry daily is of course some type of “menu”. There are so many different products available to F&I today that delivering an effective and consistent presentation to the retail customer is not realistic without a menu. But the paper menu appears to have had its day, and the tablet-based F&I presentation is gaining steam — much to the chagrin, it is assumed, of older car buyers.
Let’s discuss the reasoning behind these developments and why process will always be more important than the customer’s age.
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There are many reputable menu providers, all of whom say they have the best product for today’s consumer. Additionally, many offer some type of menu usage report functionality, and some even offer F&I production information. The big elephant in the room is a question no one asks of you, the providers. Let’s hold that thought for a moment but I promise we’ll get to what I think is that “real” question that needs to be asked.
Let’s step back for a moment and look at the market. Today’s market is composed of many different “generations” of buyers. Arguably that has always been the case, but not during the technology boom we have seen in the last decade. We can start from the baby boomers and earlier all the way through the Millennials, with Generation X in between and Generation Y just now making their presence felt.
As buying power shifts from generation to generation, technology is developing and improving at an astounding rate. While we strive to make technology based product enhancements targeting the “current” generation, we chance leaving other generations out of the mix, so to speak. Do we ever ask ourselves if what we are developing will be well received by members of other generations that still make automobile purchases every day?
That brings us back to the “elephant in the room” question: How do you know you got it right?
Amazingly, the automobile industry still fails to do some of the most fundamental research into what the consumer does or doesn’t like or want. An example would be recently at the 2016 Agent Summit in Las Vegas, I asked a simple question of the esteemed technology panel; “has anyone ever held a focus group of consumers comprised of different generations, demonstrating what menu proposals were available and getting the invaluable consumer feedback that should drive the product?”
The panel looked like a herd of deer in the proverbial headlights. One panelist answered by saying his product is driven by the great results being realized by his dealer clients. Somewhat acceptable, but is that really the reason for any positive change in results? ’Did we have a change of F&I manager(s) that are now, but previously weren’t, fully utilizing the product’s capability? Did the dealer or general manager finally put their foot down and tell the finance department that their numbers were unacceptable, and based on the menu usage report functionality, told they either start using the tools available, get the numbers up or be replaced?
Do we fail the customer by continuing to make changes to a product as important as a menu based not on their feedback or input but on what we think the customer would like to see. I liken it to being self-employed: With no external pushback, we become legends in our own minds. Let’s face it, 20 Groups were developed not just to share some dinner, drinks and good laughs, but to share best practices. They allow dealers to get out of their comfort zones and get feedback and challenges from peers.
With that in mind, let’s discuss how each of today’s in-market generations respond to technology in the F&I office:
Baby Boomers: Born between 1946 and 1964, Baby Boomers represent about a third of the population, but they outspend younger adults by about $1 trillion. Boomers are not going quietly into the sunset. Additionally, study after study proves that, contrary to many public and media perceptions, Baby Boomers have a real interest in the continuing adoption of technology.
Michael Rogers, an author, futurist, consultant and former vice president of The Washington Post’s media division, led a series of focus group discussions. He concluded that Boomers will be a driving force behind the use of information technology in the next decade, particularly in the healthcare industry, one of the largest in our society. He commented further, that Boomers don’t want technology products that are complicated and cluttered with excessive features.
Generation X and Millennials: According to Forrester Research, Gen Xers mainly use technology for convenience purposes, such as online banking and shopping. Technology has yet to become central to their social lives, and this will likely remain the case.
Millennials, however, view technology as a critical part of their life and work. They are constantly “on” and connected. They tend to embrace new technologies for socializing and working, and they adapt quickly.
The Industry’s Next Move
More and more menu providers are now working diligently on developing a tablet version of what has typically been a desktop-only product. That leads to questions, the most important of which is; will there be “two-way” DMS integration.
Let’s be honest: It’s a challenge to get F&I pros to enter the data correctly the first time, let alone the second and third times. The need to re-enter some deal information when additional F&I products are sold highlights the importance of two-way DMS integration from any menu. It is often said that they don’t have time to do it right, but they do have time to do it over and over again.
The introduction of the tablet brings additional questions. How interactive should it be? Is the screen size too small? Do we still need the F&I manager, or do we let the tablet do the presentation? Do we hand it to the customer prior to their meeting with their F&I manager?
Every provider has a different spin on why there should or shouldn’t be some type of tablet presentation available. Some even argue that providers who are against the use of this tool are against it only because they have not yet developed a tablet solution of their own. It’s an interesting perspective and possibly true in some cases.
Some might say we need tablets to engage Millennials, who are comfortable with handheld devices. Others will say tablets scare Baby Boomers away. Still others will say the tablet robs F&I pros of the ability to customize the presentation.
I believe the answer is a lot simpler than we think. For decades, our industry has struggled to find the right solution to many issues that didn’t exist as recently as the early ’90s. There was a time when discussing the business model of selling vehicles through the Internet did nothing but get you thrown out of the dealer’s office.
Ask any dealer today how much income they would lose if they shut down their website. We can no longer dismiss new technology by saying, “This is the car business. We don’t do that.” Bull! By refusing to adapt, we become our own worst enemies. Basically, that comment says the courage to move through uncharted territory has no place in the industry. Really? We are smarter than that, and we can do much better.
It’s time to shelve our egos and stop pretending we know it all. Let’s dare to do something that this industry seems to never or at best rarely do: Ask the consumer! Imagine what would happen if we developed products and processes based on what the consumer is actually looking for, not what we think they are looking for.
To all the reputable providers out there, I say let’s finally start organizing some legitimate, credible consumer focus groups that will help us develop products and processes that will drive higher CSI scores and contribute to a process that leaves the dealer and the customer happy and satisfied.
For the purposes of this particular article, I lay out this challenge to all the outstanding menu providers: Imagine being first to market with a product that you can tell a dealer client was vetted by several consumer focus groups and developed accordingly. What a concept!
