Every auto dealership wants to attract more customers, so how do you stand out from the crowd? Cars are cars and there are only so many brands. There are bound to be competitors selling the same makes and models as you, especially if your dealership sells used cars.
When you account for the influence of the internet, there are limitless possibilities either way. Sure, your competitors probably have a website as well, but your customers are smart shoppers and will do their homework to find the best price. If you give them something that stays in their minds, they’ll come back.
One of the things customers are most concerned about is financing their car. Not many people can just walk in and pay cash, so most people will need an auto loan to buy a car. The more you can do to make this process easy for them, the more likely they will come to you when it’s time to buy. Better yet, they’ll tell their friends.
Pre-Approval and Pre-Qualification
What’s the difference when a customer is pre-qualified versus pre-approved?
In general, pre-approvals are exactly as they sound – after a hard inquiry to a buyer’s credit report, if their finances are what the lender thought they were, they will probably get the loan they were offered.
A pre-qualification offer applies a soft inquiry to estimate a potential range the lender is willing to consider. Since it’s not as precise as a pre-approval, it gives the buyer more control over how much they spend when buying a car.
However, each lender has their own definition of these terms. It is important to check with the lender for the details of their offer and what it actually means. Neither pre-approval nor pre-qualification are a guarantee of a loan. Dealers should especially consider this if they offer their own pre-qualifications.
Respect The Customer’s Research
Consumers do a lot of research before they go to the showroom because they want to make sure they have the financing secured ahead of time. Some will follow up on pre-qualification offers they receive from creditors or affiliates. Others will be diligently searching online and comparing rates.
If your dealership is ready for these customers, they will gravitate to you. Your sales force should be willing to engage with customers who come with their own financing, and maybe even have a few options available to compete. Typically, dealership auto loans have higher interest rates than those from banks and credit companies, which means offering competitive rates.
However, your customers will be more receptive if you’re willing to work with them. They know what they can afford and what their realistic monthly payments should be. If you are willing to respect their research and work with the financing they bring to you, they might even be more receptive to your alternatives. Either way, you win.
Be Clear with Your Online Showroom
Your website should be an overview of the vehicles you have in stock, but even more important is having vehicle prices available. Customers can take the sticker price to their lenders as part of the pre-qualification process. This can help assure they get approved for their auto loans, which means you get paid.
When customers are trying to pre-qualify, part of the process is working out how much they can afford to borrow. This will give them an idea of what kind of car they can buy. Knowing the sticker price helps conduct a more realistic search. It can also surprise them if they can afford more than expected.
You don’t have to let your customers practically steal your cars off the lot. A range of financing options can give customers access to a variety of vehicles that can fit their needs. Show them what you’ve got.
Make Your Pre-Qualification Applications Easy to Navigate
How do you gain pre-qualified customers?
Having a clear financial page with a pre-qualification or preapproval application is the first step. Your Call To Action (CTA) links on your website should very clearly direct potential buyers to your pre-qualification and credit applications. Everything should be provided for them in an easy, secure, and transparent format. Make it easy for them to volunteer the information that makes pre-qualification possible.
When buyers seek out your showroom, decide they trust it, and choose to buy a car from you, they are more likely to fill out pre-qualification forms. However, streamlining your applications can convert even skeptical leads, and drive more potential buyers to apply. Finances are complicated enough, so ensuring your credit applications are simple can build the trust that can bring in sales.
Offer Comforts While Shopping
What else can you do to entice pre-qualified buyers into your showroom? There are numerous benefits you can include in your CTA. Customers want their shopping to be simple, so making them feel comfortable while doing so will go a long way.
Your call to action may include incentives, like free gifts, complimentary food and beverages, or a children’s play area. Anything that can make a customer more comfortable while shop[ping for a car helps increase trust between them and you. Coffee and snacks like donuts or sandwich squares from a local venue can help increase leads.
Free gifts can be small gifts to customers who respond. These might be tickets to a local event, small but useful items (like tee-shirts, mini-speakers, thumb drives with your dealership logo), or even cash prizes. Sponsoring your local youth sports teams can provide opportunities, as can purchasing gadgets at wholesale prices. Free gifts make customers feel like they’ve won a prize.
All of these are ways to get people into the showroom. The next step is to use everything you’ve done so far to get them approved and close the deal.
Keep Your Showroom Connected
Once buyers are at the showroom, have tested vehicles and chosen one, it’s time for the money to come into play. If your employees know how financing works, they can provide informed answers for buyers when it comes time to turn that pre-qualification into a sale. Customers who get in over their heads because they were given inadequate information about terms, APR, and principal.
Ensuring your showroom can run credit apps quickly will send your buyers home happy when they get approved. Remember that pre-qualification doesn’t automatically mean an approval, but it does increase the likelihood that a buyer will be approved. A digital connection and a reliable credit check service can bring you these valuable customers when they know they can get near-instant satisfaction. Capitalizing on these leads will also encourage more customers to pre-qualify with you.
Reach Out to the Customer’s Lender
If the customer ultimately doesn’t choose to finance with you, that’s okay! A customer with financing from anywhere is like a customer coming in with cash. It’s important to be ready to work with their lender because that could seal the deal.
This is where your financial pros are most important. Their job isn’t just about navigating the ins and outs of auto loans for buyers. They also need to know how to do business with lenders so the buyer can still leave satisfied. Building a good reputation with local lenders like credit unions can make this process simpler, especially since you’ll probably be talking to the same people most of the time.
Your loan department still needs to be well-versed in the topic because some people use national lenders like Citi and large banks like Wells Fargo. This attention to professionalism can bring in customers with financing and give you the chance to market your preferred lenders by establishing a reputation as buyers’ trust.
Your Bottom Line Is the Bottom Line
What can you do that others can’t or don’t? From little things like the brand of coffee in your showroom to the ease of your credit applications, attention to detail and customer comfort is as important as your marketing campaign. You have to distinguish yourself to bring in the sales. Pre-qualified customers make a great source of sales leads because they bring with them a high probability of financing. Cultivating this fertile source of leads is one way to show you’re not just another dealership.