How Lenders Can Reduce Friction in the Auto Sales and Finance Journey

No matter what the industry, product, or service, consumers take a “sales journey” along the path to purchase. From the first step to the last, a customer’s sales journey is the total picture of every experience a customer has with a company or brand.

Each touchpoint or individual interaction between the customer and the company, whether in the physical world or in digital “micro-moments,” has the potential to engage shoppers and propel them toward a sale — or the potential to frustrate, intimidate, or bore them and push them toward another alternative (including no purchase at all).

Stumbles Along the Way

Such negative interactions are called “friction,” because they increase resistance, slowing or stopping movement toward buying a product or service. For many years, auto buyers expected to encounter friction in the purchasing and financing process. Today’s buyer, however, lives in a world of high-reward and near-effortless transactions with companies like Amazon and Apple. Consumers increasingly expect low-friction experiences.

Consider Every Touchpoint Along the Way

Reducing friction means cleaning up the pain points and obstacles that frustrate customers or make experiences more difficult. For example:

  • Slow or uninformative websites or apps
  • Unhelpful or poorly trained staff
  • Long waits for approvals or service
  • Non-personalized experiences that leave customers feeling like “just a number”
  • Lack of transparency in the financing process
  • Negative company reviews
  • Confusing instructions or complex procedure

Also look at parts of the journey that aren’t necessarily bad but that provide an opportunity to create an even greater experience. Surprising customers with an unexpected amenity or convenience can help overcome the effect of friction encountered elsewhere:

  • User-friendly smartphone apps for loan shopping, payment calculators, and loan applications
  • A change in terminology and approach to present staff as partners and advocates instead of people making sales or processing transactions
  • Gamification or animation to make understanding complex legalities or completing normally tedious processes more enjoyable
  • An online quiz to walk buyers through add-on F&I offerings so they feel empowered to choose options that make sense for them
  • E-contracting, e-disclosures, and e-signatures to reduce paperwork
  • A personalized note or small gift after the sale, and a follow-up call a few days later to answer questions or help setting up an account

Lynn Hess is a content specialist at State National Companies, a division of Markel Corp., and writes on a variety of financial topics relating to banking, credit unions, and insurance. State National is the Customer Experience Partner of Auto Finance Excellence (AutoFinanceExcellence.org), a sister service of Auto Finance News.

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