Subprime Hacks: Get More Approvals

Remember 2009? There were tight pocketbooks and even tighter lending guidelines. Strong and efficient lender relationships were a requirement for success in the subprime market.

Much has changed since those dark days. But as much as things change, many of the key components of successful lender relationships that applied in 2009 are still very much valid for subprime success today.  Among them:

• Send applications only to lenders who have a chance of approving them. Some dealers think they’ll have a better chance of getting a subprime customer approved by taking the shotgun approach. They send an app out to as many lenders as possible, hoping that at least one will buy the deal. But the truth is that you will have more success if you are able to strategically match customers with specific lenders. Try to get it down to the lenders that will be truly interested.
• Keep on top of your book-to-look ratio. If you send a ton of apps that don’t turn into deals to a particular lender, it’s safe to say that they may start to think twice about doing business with you, and may even shut you down. It’s good practice to give your best lenders a fair shot at the workable deals. Be a student of what lenders like and what they don’t like.  Ask your lender rep; they will be happy to share that information.
• Follow the lender’s check-sheet. Every lender has a unique check-sheet that is ordered in a specific way. They’re used when reviewing applicant documents to verify that the paperwork is complete. Following each lender’s check-sheet will enable you to present documents in the lender’s preferred order so that they will be easier to review. The cleaner the lending package the faster you will get funded.  Make the lender’s job easy to fund your deals.
• Proactively track the funding. When you are waiting for a deal to be funded, you can’t just ship it and forget it. Be proactive in following up on funding status, this will unearth issues quickly and improve the speed your deals get funded.. Proactive dealers get deals funded more quickly.
• Be ready to rehash a deal. If you feel that an app has been unfairly denied or if your customer needs better terms, you should call up the lender and be able to intelligently rehash the deal. You’ve spoken with the customer face to face, and you know details that may not be on the loan application. Make sure you are able to simply and clearly articulate the consumer’s situation and why the lender should consider different terms or conditions.  And if you have a good relationship with the lender’s underwriter, you will probably have a better shot at pleading your case.

The rules of lending have changed since 2009, but the rules of successful relationships have not. How are you doing on your end? Remember, relationships are a two way street.

You can make sure that you’re working with the best lenders by finding out which ones have the highest rankings in your area. The team at CarsDirect and Auto Credit Express can get you the most up-to-date rankings for both local and national lenders. Feel free to reach out to us at 888-535-CARS (2277) for a personalized market-analysis report for your dealership.

Living Up to the Conference Hype

I recently attended the Dealer Synergy Internet Sales 20 Group conference in Boston. I left with that unique feeling that comes after you have opened yourself up to really learning, and have attained clarity with clear direction. The event was attended by the majority of Toyota dealers in the New England / Boston Region (as well as some folks from the Toyota corporate office), several Massachusetts State Automobile Dealers Association dealers, and of course the Dealer Synergy consulting team and their partner vendors (we at CarsDirect are proud to be such a partner).

We all know that many auto conferences tend to be light on content. The Internet Sales 20 Group workshops are different, offering an intense three days of real working groups tackling the digital space with a passion for improving and advancing the industry. I was part of a panel that discussed CRMs and digital media / advertising consisting of a group that represented a phenomenal amount of industry experience. I also led a session on Mobile Strategy that was met with great interest, and Mobile continued to be a strong theme over the course of the conference. Indeed, the passion and energy from the dealers who attended was palpable – and no one was afraid to speak his mind and address the tough subjects.

If you really want to learn, and have a passion for improving your Internet / Digital Sales department, I highly recommend you consider an upcoming Internet Sales 20 Group conference.

Todd Dearborn
VP Sales, CarsDirect
(310) 280-4282
todd.dearborn@carsdirect.com

An Addition to the CarsDirect Family

CarsDirect’s parent company, Internet Brands, recently announced that it has acquired High Gear Media, a next-generation publisher of automotive news, information, and tools for in-market car buyers. High Gear Media joins the Internet Brands Automotive Group, which includes CarsDirect and our collection of more than 130 auto enthusiast websites.

Founded in 2007, High Gear Media has grown to operate some of the fastest-growing online automotive brands, including The Car Connection (research content and e-commerce) , Motor Authority (luxury and performance news and enthusiasts), and Green Car Reports (clean environmental news and enthusiasts).

The combined Internet Brands Automotive Group / High Gear Media audience will number more than 35 million unique monthly visitors, making it one of the largest automotive networks on the Internet. As a dealer, you’ll benefit from even more organic new and used car sales opportunities. Robust advertising options including display ads and new / used car leads will allow you to precisely target your desired market segments.

“We have always admired the quality of digital content produced by High Gear Media,” said Todd Dearborn, Vice President of Sales at CarsDirect. “Our dealers will benefit greatly from more sales opportunities as we integrate High Gear into our growing automotive portfolio. We’re truly excited about the innovation we’ll uncover and achieve in the days ahead.”

To find out how you can start benefiting from this exciting addition to our portfolio, contact your CarsDirect representative or e-mail us today!

Take Texting to the Next Level

There’s no doubt that text messaging has permanently changed the way people communicate. For better or for worse, texting is here to stay. But can texting actually help you sell more cars?

As we covered in previous Dealer Reports, one-third of mobile inquiries are either buying this weekend, on their way to a dealership right now, or actually at a dealership shopping. Savvy dealers have been texting with customers to set up appointments, answer questions, and negotiate deals for quite some time now.

Here at CarsDirect, we saw an opportunity to take the power of texting and mobile devices a step further – to engage customers via text whether they’re seeing one of your ads at home, browsing your inventory while on the go, or actually on your lot. This month, we’re officially unveiling CarsDirect Mobile Connect, a cutting-edge, turnkey mobile marketing solution designed to maximize sales opportunities among mobile customers.

Here are some highlights of the new capabilities CarsDirect Mobile Connect is pioneering:

Unique Text [Code] Functionality

At last, a quick and easy way to enter the world of text marketing. CarsDirect Mobile Connect makes it simple to get unique text codes for your entire vehicle inventory. These codes can be promoted in all marketing channels, such as vehicle listings in print ads, as well as on special inventory decals provided by CarsDirect:

Each text inquiry receives an auto-text response with a link back to a corresponding mobile-optimized landing page (vehicle detail page, dealer page, offer page, etc.):

Meanwhile, customer information is instantly sent to your CRM, providing a new source of qualified leads and an easy way to track ROI on marketing campaigns:

Highly Optimized Mobile Landing Pages

The mobile-optimized landing pages to which text inquires are directed are professionally designed and incorporate your dealership’s branding:

These landing pages feature an automated vehicle inventory feed featuring VIN details, and photos. Customers can text your dealership for more information directly from the page. Landing pages also make use of clean, responsive design that renders correctly on virtually all mobile devices.

No existing mobile site, or not happy with your current mobile site? No problem. CarsDirect Mobile Connect can easily become your mobile site, and even use your existing domain.

We’re Just Getting Started

All of us at CarsDirect are very excited about the mobile capabilities that CarsDirect Mobile Connect is bringing to dealerships across the country. We plan continuous upgrades and enhancements to the products as the mobile customer continues to evolve.

If you’d like more information about CarsDirect Mobile Connect or have specific questions about how this texting technology can help your dealership sell more cars, please get in touch at any time at connect@carsdirect.com or (800) 260-5857.

Cross Shop Close-Up: 2014 Lincoln MKZ

When Lincoln’s MKZ debuted in 2006, it impressed buyers with a luxurious interior that featured an array of standard equipment. What didn’t please anyone was its resemblance to the mass-market Ford Fusion. If not for its Lincoln grille and tail lights, the MKZ’s exterior styling made it a dead ringer for the Ford. That made it hard for the MKZ to compete with both entry luxury stalwarts like the Lexus ES350, and with more performance-luxury oriented competitors like the BMW 3-series and Cadillac CTS.

A 2013 restyle of both the MKZ and Fusion brought greater differentiation. Although many components remain shared with the Fusion, the MKZ now looks and feels like a distinct automobile, especially with its optional sliding glass roof.

Are these distinctions ringing with consumers, or does Lincoln continue to compete with itself and other vehicles in the Ford family stable? To find out, we used exclusive CarsDirect cross-shopping data from the past three months to take a look at the top five vehicles currently cross-shopped against the 2014 Lincoln MKZ.

(The percentages refer to the percentage of total MKZ shoppers who also cross-shopped the alternate models listed. For example, 10.5% of buyers who shopped an MKZ also shopped a Fusion.)

Lincoln MKZ Hybrid: 21.6%

Ford Fusion: 10.5%

Honda Accord: 10.2%

Cadillac ATS: 9.8%

Cadillac CTS: 9.3%

CarsDirect’s take: It’s perhaps no surprise that the primary model cross-shopped against the MKZ is the hybrid version, since it delivers 45 mpg—tops among all luxury cars—and costs exactly the same as the base non-hybrid V6. However, the next most cross-shopped model continues to be its Fusion cousin, followed by the mass-market Honda Accord. Offerings from Cadillac – Lincoln’s closest traditional rival – round out the top five.

These findings indicate the Lincoln still has some work to do in terms of capturing attention from entry luxury shoppers considering the dominant German and Asian competition. A recent advertising campaign might help jump-start such consideration, and as the striking MKZ continues to hit the streets in larger numbers, we wouldn’t be surprised if this cross-shopping data changes significantly over the next year.

Want custom cross-shopping data for your vehicles? Contact us at 866.852.3784 or connect@carsdirect.com for a customized cross-shop report.