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What Can Dealers Do NOW to Keep Things Moving?

Published: March 26, 2020 by Guest Contributor

Car business owner in the showroom

COVID-19 has drastically shifted our everyday lives. Many of us are quickly trying to adapt to the current environment—including car dealers. While our primary concern will always be the health and safety of our friends, families and communities, much like other businesses, car dealers and the rest of the auto industry will be impacted moving forward.

The auto industry has historically dealt with the ups and downs of the market, but we are in new territory with COVID-19. The short-term impact on sales is unknown.

In uncertain times, we need to find ways to adapt to our situation. We want to help you manage through this unprecedented period. Here are a few things to consider, in the framework of a start, stop and continue exercise for every leader in every dealership.

Start
Deliver your value differently. The retail and service centers within the auto industry will look very different during this time. There will be individuals that need cars and repair services. You need to set up processes that minimize person-to-person contact over the coming days, weeks and months. This might mean taking a cue from pick-up/drop-off and delivery retailers; enabling online processing of paperwork and low-to-no contact vehicle exchanges or service scheduling.

Stop
You need to end all communications that are delivered through traditional, digital or social channels that have not been reviewed through the lens of our current environment. More than ever, your customers need to trust that you are fully aware and tuned into their needs. Ensure your messages draw a deeper connection to your customers. Car dealers are among the most prominent businesses in the community and this is a great time to step up and show true leadership—perhaps by donating to a local food bank or helping deliver meals to senior citizens. Find the cause in your community that inspires you to action. Whatever your choice for community leadership, talk about it on your social channels—encouraging others to take an active role in supporting communities.

Continue
Become keenly aware of who needs a vehicle now and meet their needs. While many people may avoid the dealership in the coming weeks, there are individuals that will need a vehicle—perhaps their lease is set to expire, or they experience car trouble and need a replacement vehicle. It’s important to set up and streamline your ability to connect with customers in one-to-one communication. This can be done through a dedicated support line for customers with more urgent vehicle needs. Anything you can do to strengthen your communication ties with your current customers will help as their mobility options are becoming more and more restricted.

This is an unprecedented time for us all. Conditions near your store may call for drastically different strategic decisions. No matter what challenges are presenting themselves in your dealership, Experian is committed to helping car dealers navigate the coming months.

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Published: March 1, 2025 by Jon Mostajo, test user

Electric vehicle (EV) registrations are re-gaining momentum as a wave of more affordable models hit the market, pushing more consumers than ever to make the transition. According to Experian’s State of the Automotive Finance Market Report: Q3 2024, EVs made up 10.1% of new vehicle financing this quarter, increasing more than 30% from last year. Furthermore, 45% of EV consumers leased their vehicle in Q3 2024—resulting in EVs accounting for 17.3% of all new vehicle leasing. Of the top five transacted EV models this quarter, Tesla accounted for three—with the Tesla Model Y leading at 31.8%, followed by the Tesla Model 3 (14.3%) and Tesla Cybertruck (4.9%). Rounding out the top five were the Ford Mustang Mach-E (3.9%) and Hyundai IONIQ 5 (3.7%). Interestingly, data in the third quarter of 2024 found that consumers’ financing decisions vary based on the EV model they’re looking at. For example, 76.5% of consumers purchased the Tesla Model Y with a loan and 13.1% opted for a lease; on the other hand, only 8.5% of consumers bought the Hyundai IONIQ 5 with a loan and 78.7% chose to lease. Despite the rising interest in leasing as more incentives and rebate programs roll out, some consumers still prefer to purchase their EV with a loan. Understanding financing patterns based on different models is key for professionals as they cater to the diverse preferences and determine the long-term viability of certain EVs and their potential for leasing renewals. Snapshot of the overall vehicle finance market As the finance market continues to stabilize, it’s notable that the average interest rate for a new vehicle fell year-over-year, going from 7.1% to 6.6%, respectively. However, average new vehicle loan amounts increased $736 from last year, reaching $41,068 in Q3 2024, and average monthly payments went from $732 to $737 in the same time frame. On the used side, average interest rates saw a slight uptick to 11.7% in Q3 2024, from 11.6% last year. Meanwhile, the average loan amount dropped from $1,195 over the last year to $26,091 this quarter and the average monthly payment declined from $538 to $520 year-over-year. With the overall market shifting and EVs re-sparking interest, automotive professionals should leverage how consumers are purchasing their vehicles based on average payments and the fuel type as more incentives are being offered. Monitoring these insights can unlock opportunities for tailored financing solutions that meet the needs of consumers as preferences continue to evolve. To learn more about automotive finance trends, view the full State of the Automotive Finance Market: Q3 2024 presentation on demand.

Published: December 5, 2024 by Melinda Zabritski

We are squarely in the holiday shopping season. From the flurry of promotional emails to the endless shopping lists, there are many to-dos and even more opportunities for financial institutions at this time of year. The holiday shopping season is not just a peak period for consumer spending; it’s also a critical time for financial institutions to strategize, innovate, and drive value. According to the National Retail Federation, U.S. holiday retail sales are projected to approach $1 trillion in 2024, , and with an ever-evolving consumer behavior landscape, financial institutions need actionable strategies to stand out, secure loyalty, and drive growth during this period of heightened spending. Download our playbook: "How to prepare for the Holiday Shopping Season" Here’s how financial institutions can capitalize on the holiday shopping season, including key insights, actionable strategies, and data-backed trends. 1. Understand the holiday shopping landscape Key stats to consider: U.S. consumers spent $210 billion online during the 2022 holiday season, according to Adobe Analytics, marking a 3.5% increase from 2021. Experian data reveals that 31% of all holiday purchases in 2022 occurred in October, highlighting the extended shopping season. Cyber Week accounted for just 8% of total holiday spending, according to Experian’s Holiday Spending Trends and Insights Report, emphasizing the importance of a broad, season-long strategy. What this means for financial institutions: Timing is crucial. Your campaigns are already underway if you get an early start, and it’s critical to sustain them through December. Focus beyond Cyber Week. Develop long-term engagement strategies to capture spending throughout the season. 2. Leverage Gen Z’s growing spending power With an estimated $360 billion in disposable income, according to Bloomberg, Gen Z is a powerful force in the holiday market​. This generation values personalized, seamless experiences and is highly active online. Strategies to capture Gen Z: Offer digital-first solutions that enhance the holiday shopping journey, such as interactive portals or AI-powered customer support. Provide loyalty incentives tailored to this demographic, like cash-back rewards or exclusive access to services. Learn more about Gen Z in our State of Gen Z Report. To learn more about all generations' projected consumer spending, read new insights from Experian here, including 45% of Gen X and 52% of Boomers expect their spending to remain consistent with last year. 3. Optimize pre-holiday strategies Portfolio Review: Assess consumer behavior trends and adjust risk models to align with changing economic conditions. Identify opportunities to engage dormant accounts or offer tailored credit lines to existing customers. Actionable tactics: Expand offerings. Position your products and services with promotional campaigns targeting high-value segments. Personalize experiences. Use advanced analytics to segment clients and craft offers that resonate with their holiday needs or anticipate their possible post-holiday needs. 4. Ensure top-of-mind awareness During the holiday shopping season, competition to be the “top of wallet” is fierce. Experian’s data shows that 58% of high spenders shop evenly across the season, while 31% of average spenders do most of their shopping in December​. Strategies for success: Early engagement: Launch educational campaigns to empower credit education and identity protection during this period of increased transactions. Loyalty programs: Offer incentives, such as discounts or rewards, that encourage repeat engagement during the season. Omnichannel presence: Utilize digital, email, and event marketing to maintain visibility across platforms. 5. Combat fraud with multi-layered strategies The holiday shopping season sees an increase in fraud, with card testing being the number one attack vector in the U.S. according to Experian’s 2024 Identity and Fraud Study. Fraudulent activity such as identity theft and synthetic IDs can also escalate​. Fight tomorrow’s fraud today: Identity verification: Use advanced fraud detection tools, like Experian’s Ascend Fraud Sandbox, to validate accounts in real-time. Monitor dormant accounts: Watch these accounts with caution and assess for potential fraud risk. Strengthen cybersecurity: Implement multi-layered strategies, including behavioral analytics and artificial intelligence (AI), to reduce vulnerabilities. 6. Post-holiday follow-up: retain and manage risk Once the holiday rush is over, the focus shifts to managing potential payment stress and fostering long-term relationships. Post-holiday strategies: Debt monitoring: Keep an eye on debt-to-income and debt-to-limit ratios to identify clients at risk of defaulting. Customer support: Offer tailored assistance programs for clients showing signs of financial stress, preserving goodwill and loyalty. Fraud checks: Watch for first-party fraud and unusual return patterns, which can spike in January. 7. Anticipate consumer trends in the New Year The aftermath of the holidays often reveals deeper insights into consumer health: Rising credit balances: January often sees an uptick in outstanding balances, highlighting the need for proactive credit management. Shifts in spending behavior: According to McKinsey, consumers are increasingly cautious post-holiday, favoring savings and value-based spending. What this means for financial institutions: Align with clients’ needs for financial flexibility. The holiday shopping season is a time that demands precise planning and execution. Financial institutions can maximize their impact during this critical period by starting early, leveraging advanced analytics, and maintaining a strong focus on fraud prevention. And remember, success in the holiday season extends beyond December. Building strong relationships and managing risk ensures a smooth transition into the new year, setting the stage for continued growth. Ready to optimize your strategy? Contact us for tailored recommendations during the holiday season and beyond. Download the Holiday Shopping Season Playbook

Published: November 22, 2024 by Stefani Wendel

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