Improvements in dealership customer relationship management systems are a boon for finance and insurance business, creating sales opportunities throughout the car ownership life cycle.

Dealers should use CRM to market F&I to existing customers in databases.

Since F&I was developed, the sale of its services and products has been almost exclusively during the initial vehicle-purchase transaction.

Technology has evolved, product offerings have expanded and interaction with lenders has changed. But the F&I sales effort has virtually remained constant, with no thought of opportunities after the immediate sale.

So while dealers send out coupons and such to lure customers to the service department or back to the showroom, it is rare to see a dealer take the same approach to marketing F&I products after the sale.

This remains true even though the same information that is collected and used to develop the service mailings could be easily modified to successfully support an F&I marketing campaign.

There are many potential benefits to creating and launching an F&I-focused campaign.

Higher profit is an attractive initial reason, of course.

An additional motivation is satisfying the changing needs of the consumer during the life of a vehicle. While they may not have wanted an extended service contract at the time of sale, they might feel otherwise as their vehicles age. And if the dealership is not offering an extended warranty for such late comers, plenty of places on the Internet are.

Many other products could become more attractive and pertinent to a customer after specific ownership events.

Imagine offering gap insurance to a consumer immediately after some minor bodywork, or a dent removal program after a few months of ownership and that inevitable first door ding has happened.

The same could be the case for such products as a security system, vehicle accessories, roadside assistance or other items specific to the dealer's market. A maintenance program would be ideal to market as the customer's initial service appointment is approaching.

Reminding sub-prime customers that they might qualify for a lower contract rate or new vehicle is usually an easy and successful campaign.

Industry studies indicate that an opportune offering of a needed product to a consumer is not viewed as intrusive. Rather, it is seen as supportive, caring and fostering customer appreciation and loyalty.

A well-designed and appropriate F&I sales piece (promoting any number of services and products) that is delivered in a timely and professional manner enhances customer acceptance and transactions with an original dealership.

Dealers interested in extending F&I into the customer's ownership life cycle should consider taking the following actions in order to put an effective marketing effort together:

  • Work with their dealership-management system providers in developing and executing F&I marketing campaigns as a CRM function.
  • Develop an internal plan to help support these campaigns. This could include delegating responsibilities among personnel, involving a business development center that handles customer inquiries, creating an appropriate pay plan for involved staffers and overseeing and tracking initiatives.
  • Contact the existing extended-service contract provider to determine if there are follow-up programs in place. Many providers have a follow-up program to sell to car buyers that did not purchase one initially, but they keep the revenue. That is obviously not dealer friendly, but there are several independent companies that can implement a turnkey follow-up program at little or no cost to the dealer.
  • If the DMS does not support these efforts, dealers should put into practice a real service-drive program that rewards the writers for a proper referral to F&I. Create initiatives based upon customer-service events such as those described above. Training should be held, if necessary, to support staffers and make them feel comfortable with new duties.

Bryan Dorfler is a finance & insurance consultant. He's at bryan@automotivefinanceconsultants.com.