XtreamService 700Credit Webinar

Susan Burke, Marketing Vice President, 700Credit Good afternoon and welcome to our educational webinar series. This is Susan Burke from 700Credit. We all appreciate you being with us this afternoon. Today, we're pleased to have Hayley Holmes, product manager from Reynolds and Reynolds, on as the guest speaker, and she’ll be going through the benefits of pre-screen and how to use a pre-screen throughout the sales process to sell more cars. You will be getting an email from us after this event with links to the sales deck or the webinar deck that you're looking at, as well as a video to the event and links to forms in case you want more information, either from Reynolds about their solution or from 700Credit about our pre-screen solution. We also have on the line Ken Hill, managing director from 700Credit. Ken will be joining us at the end to help answer questions. And speaking of questions, feel free throughout this presentation, if you have a question, put it in the question bar, and we will make sure we answer all of them at the end of the event. And so without further ado, I'm going to hand it over to Hayley.

Hayley Holmes, Product Manager, Reynolds and Reynolds Thanks, Susan. Hi everybody. As Susan mentioned, my name is Hayley Holmes, and I am a product manager at Reynolds, where I have been working specifically on trying to identify the best way to approach customers in the service lane, and a little bit with our CRM as well for about six years now. And today I'm going to go through and address the idea of using pre-screen in a proactive way and how it might help enhance some of the features you're using in your dealerships and some of the processes you have in place.

But before I really dive into automotive, I wanted to get you thinking about pre-screen in general and maybe how some other industries are using it. So pre-screen data has been used for years in the credit card and mortgage industries, and it's a way to pre-approve the customers for credit. Perfect examples of this are going to be the letters that you've received in the mail with an offer talking about signing up for a credit card. I know I definitely have received some of those in the past, and this is a proactive sales approach that these companies are taking in trying to gain the customer's business.

One big thing on this, they are doing their due diligence to make sure that they analyze any of the customer's potential financial situations to make sure they actually would qualify, so they are going through and running a pre-screen on these customers. Another thing I want to mention to you and get you thinking about is this is another way to market to the customers. So think of pre-screen as possibly a way you can give the customers a new message when approaching them about buying a vehicle. So keep that in mind as well. It isn't just about the information or getting the customer pre-approved. We can actually think about it from a marketing perspective as well.

So transitioning and keeping all of that in mind, how is it being used in the automotive space? And really the concept has gained popularity in the automotive retail space over the last five years or so. And a dealership pre-screen works very similar to how the credit card or mortgage pre-screen works. The customers don't necessarily know that the pre-screen is being ran on them, but they don't necessarily feel like it's intrusive or invasive because they're used to receiving those offers in the mail from other industries. It gives us a quick overview of where the customer stands without negatively impacting their credit. And this is what makes it a soft pull, so you might have heard it referred to that as well in the past.

The only information that you need in order to run a pre-screen is going to be the customer's name and address. You don't need that additional social security, date of birth, other personal information in order to get an idea of where the customer might be financially. It does return the customer's credit score, any kind of prior auto loan data, and a lot more without negatively impacting their credit. So that's a really important piece to it. So keeping all of that in mind, I actually want to start off to see how can we effectively use this information to help get us the best result. And how do we find the best of the best prospects to ensure that we're approaching the right ones and running a pre-screen on the ones that really count. So before we dive into that aspect of it, I actually would like to go ahead and start with a poll and really get an idea of how often are you approaching service customers about upgrading and trading in their vehicles. So I believe Susan will be able to pull that up on you.

SB I just pushed the poll out for everyone. So I'm going to give everybody a minute to think about it and to select their option, and then I'll share the results with everyone. All right, it looks like the voting has stopped. So the answers we have are thirty-eight percent offer it one in five times. Twenty-one percent, one in ten. Seventeen percent, one in twenty. And twenty-five percent said never. So this is a really good session for you all, so you understand how you can do it. And Hayley's got a lot more content to share with you, so I'm going to close the poll. Go ahead Hayley.

HH OK, great. Yeah, that's good to know. And it sounds like we actually have a pretty good variety of different ways that maybe you're using and approaching customers or how you're deciding they're going to approach them. And then we also have our group that say you're not necessarily approaching customers in service about upgrading or trading in their vehicle. For the group that's approaching one in five or one in ten, is that more you're trying to approach everyone, you're trying to figure out, how can I find which customers are best? Maybe you're using some type of equity mining tool and approaching customers in positive equity, and that might fall into one in twenty as well. This would also include the people that aren't approaching. Is there a lack of information you have on knowing who the customers are and what they're likely to do next? And what kind of training and best practices do you have in place that can help with that approach and that handoff from service to sales? So I'll try to make sure to hit on the variety of different ways we might be doing this, since we do have kind of a good split throughout this session.

So the next thing I want to keep in mind, why is the service lane pre-screen important? And the reality is your service lane customers are your best customers. They're in your store. They obviously like you enough to be bringing the vehicle in for service with you, and they have the time. I know not everyone's necessarily staying at the dealership while the service is being completed on their vehicle, especially with everything going on with the pandemic. But they are going to have to interact with you and come back and at least pick up their vehicle. Also, because of the pandemic, showroom traffic is maybe a little bit slower than what it used to be. So we really should consider approaching and discussing these offers with our service customers because they are there, their vehicle is there, and it's a way to help pick up some additional traffic that we have seen a decline in because of the pandemic.

There's also this underlying issue that maybe some of your service customers didn't purchase the vehicle from you, so we don't have that additional information regarding the equity position or their financing. So how are we able to approach them and have an intelligent conversation if we don't have that type of information? And really an effective pre-screen will actually help kick-start the sales cycle for customers who are just in for service. You'll be able to turn these service customers into a sales customer and this will help keep that cycle flowing where they're going to actually continue to do business with you. And it will help gain some of those service customers as conquest customers because you're bringing them over to the sales side of the business.

So next part is how can a service lane pre-screen benefit you? And the most important thing that we've seen from this and that we've gotten feedback from dealers that they really like is this trade line information. This allows us to get an idea of who the customers are and some additional information regarding them. This is especially important for those customers, as I mentioned before, that didn't necessarily purchase the vehicle from you. They're just servicing with you. You'll be able to see where exactly the customer is in the life of the loan, what kind of monthly payment they're making, what's their payoff, how did they finance, and I'll actually go through and show you an example of all of the financial information we actually get back when we run a pre-screen. But this really helps open up possibilities, and it helps move the conversation along because you have a better idea of where the customer is financially.

Another piece that can also be beneficial for the customers that maybe they did purchase from you, but used outside financing so we can get an idea of where they currently are with that, or maybe they've refinanced since they purchased the vehicle from you. So, again, this isn't just necessarily going to be for those customers that didn't buy from you. It can really impact all of them, and you can get that updated financial information from the bureaus. So it can be very beneficial to have that data.

Along with that, how do we pinpoint which customers are going to be the best ones to approach? The key to identifying those upgrading and purchasing might be with some additional data. So kind of referencing back to the poll, we had our group that was approaching maybe one in five; are your salespeople possibly not approaching every single customer because they kind of get tired of being told, no, I'm not interested. Is there a way we can help identify which customers they should be approaching and which ones we should be running a pre-screen on?

And to pinpoint which customers are best to approach, I want us to consider using three additional types of data. And the first is going to be transactional data. So who is this customer in regards to you and your dealership? What kind of sales and service history do they have with you and how often are they servicing or purchasing? How can we maybe bring them ahead in that buying cycle?

The second is going to be demographic data. This is going to be an important piece because we all like to think that we are unique and individual, but when it comes down to it, we actually act and behave very similar to those that we live around and interact with on a daily basis so we can actually draw a lot of information and start to analyze, based on these customers and who they are, what are the chances that they're going to come in and upgrade into a vehicle and maybe even trying to pinpoint which vehicle would be the best fit for them?

And then going off that demographic, I mentioned that we act and behave similar so that behavioral data is going to be an important piece as well. Is it going to be somebody that maybe they recently moved? Are there other habits that we're able to track and pick up on to get an idea that customers that do this end up buying one month later and then we can start to see and get an idea of a pattern. We can utilize that to help pinpoint when is the best time to approach some of those other customers. What it comes down to is the more data you have on a customer, the better you're going to be able to direct that conversation. And it's going to help support your approach because you have all the financial information with the pre-screen as well. So think of transactional, demographic, and behavioral data as a way to identify which customers we should be approaching in service. And then pairing that pre-screen data is just going to make it more impactful and get a better idea of where the customer is financially.

To go on this a little bit more, I want to actually bring in a couple of different industries that I'm sure we are all familiar with, especially after this year. And the first is going to be Netflix. So Netflix actually analyzes all the different login profiles and users to see which TV shows and movies are frequently watched, and then they'll compare it to similar users. You might be familiar that after you've watched a movie or show, they'll have a category that says because you watched this, we recommend these other movies. Another thing that people aren't as familiar with is they actually have different thumbnail photos when they're offering up their content. And this comes down to being relevant and specific to the customers. Their little thumbnails are constantly changing as their data continues to grow. And they're really trying to figure out which is going to be the most successful and most appealing to their customers.

So in this example, I really enjoy watching romance. So the top line might be some of the movies I enjoy watching. And within my user profile in Netflix, if Good Will Hunting is an option that comes up, you'll notice that it's going to have the actors leaning in about to kiss to appeal to the fact that I prefer to watch romance.

However, maybe my husband's profile, he prefers to watch comedies, so that would be the bottom line that we see. And when Good Will Hunting pops up for him as a recommendation to watch, you'll notice that Robin Williams is in that thumbnail photo to appeal to him that this is going to be funny. There's going to be some good moments to laugh at as well. So you'll notice that Netflix is trying to offer up depending on who the viewer is and what they're more prone to click on. And I just want us to think about that, because when we're approaching customers, maybe even specifically in the service lane, how are we customizing our approach and offer to be appealing to them?

The second industry that I want to take a look at is going to be Amazon. They actually focus on studying how customers will spend more money to increase their customer loyalty. And I think from a dealership's perspective, that's probably something we all would strive to want to do. How can we get our customers to spend more money with us and to be loyal to our dealership and our brand? And they analyze different data patterns related to the purchased items so that they can recommend additional or similar products based on that customer's behavior.

So going back to that behavioral data, in this example, you will actually see that there are some accessories that are being recommended for a recently purchased Kindle. So because I recently purchased a Kindle, Amazon is going to recommend these different cases for me as something I might be interested in purchasing. And this method actually generates thirty-five percent of Amazon’s sales annually. So just by offering up and making the customers aware of their different products that are out there, they're able to get thirty-five percent of their sales just from this method. And I like to bring up these examples, because this data is prevalent in other aspects of our daily lives. Customers are used to it at some point, either Netflix or Amazon, and there are a lot of other companies and industries out there that are doing this. And the customers are used to it being custom to them and personal and relevant to what they are experiencing in their life and what their needs are.

So a dealership can instate a similar model and maybe specifically in the service lane, and this might help us to identify likely buyers and who is likely to purchase and even what they're likely to upgrade into. So keeping all this information in mind and kind of offering up different vehicles or approaching customers and service, I want to go through this example. And I want you to think, if you knew this information, that you had a twenty-five year old man coming in for a service appointment tomorrow and you knew he was driving a 2017 Ford F-250. So that's what he's bringing in for service. But he didn't purchase it from you. So we don't have any of that additional financial information. Is this somebody that you would want to approach? And my group of one in five customers are approaching the service lane; my guess would say that you probably would want to try to approach him. The vehicle's only a couple of years old. Also with service appointments, we probably have a good idea of at least the estimated mileage. So maybe it would end up making a decent used vehicle for your pre-owned lot.

Our group of dealers on the call that said you never approach customers, is that something that you could be thinking about? This could be a good way for me to actually acquire some valuable used vehicles instead of going to auction, especially now that it's starting to trend that the used vehicle market is increasing after everything that's been happening this year. So when it comes down to it, I don't know a lot about this person or where he is financially, but that's the great thing about pre-screen information. So if we prescreen the customer, we're actually able to get a lot of that financial information regarding the F-250 that he's currently driving. And then maybe along with some other aspects, such as age and income, maybe now there's a presence of children and some other preferences that we've been able to track. This might make it so we identify that he is actually very likely to purchase, and we're able to get a good idea of what he can maybe afford and upgrade into.

So this is actually an example of our XtreamService lead sheet. This is the Reynolds offering for approaching customers in the service lane to help identify which customers are most likely to upgrade and which ones are the best to approach. And I want to point out that in the middle third of this lead sheet where it says current vehicle, we know that he's driving that 2017 F-250, and you'll notice that we're able to fill in how much he financed, what's his monthly payment currently, and get an idea of where he is financially, all because of the pre-screen information. Because of this, we're actually able to structure a new proposal for him where we would actually upgrade him into a 2020 F-250. And when it comes down to it, we think we can actually help lower his payment by eighty dollars a month. So keep all that in mind, this is something that your salespeople might be able to have access to, to have an intelligent and specific conversation with customers who have never been a sales customer with us before, but is doing service with us. So how do I be relevant to him?

Speaking of the prescreen information, because I do want to hit on that point, you'll notice up by the customer's name to the right of it within that blue box, there's a green approved. And this is actually where you would be able to go in and get some additional information regarding what the pre-screen results returned. So if I were to click on that approved, it actually would open up and show me here are my pre-screen results, what kind of score does it say he has, and what type of available revolving credit does he currently have access to? And then this auto trade line is that information where we were able to identify that, yes, this vehicle, this F-250 that's being brought in for service, here is the financial information on that vehicle. So you'll notice you have your interest rate, even what percentage is it currently paid down on. A lot of good information here that will let you get an idea of where the customer is financially.

A second part to what we can look at from this pre-screen results is actually a certificate that can be presented to the customer. And I want us to think of this as a possibly different way of marketing to our customers. So you have this certificate that lets them know that they're pre-approved. If we're trying to approach this customer in a service lane, maybe this is something that I print off and I go up and have a conversation and it gets the conversation going. It helps plant that seed that you are your pre-approved. Have you considered upgrading into a new vehicle? I just wanted to make you aware that this is an option. It's a soft sell, but it gets the conversation started and it gets the customer thinking. And a lot of times that helps pull them ahead in that buying cycle. So I want you to keep that in mind. That might also be where you print the certificate off, and you leave it in the vehicle for the customer. Or it's something we can email, and it also can be direct mailed to them. So there's a lot of different ways you can connect with the customer to let them know they are pre-approved, and it gets your dealership's name in front of them and gets them thinking about upgrading into a vehicle.

This lead sheet that we have in the back that we went over, this XtreamService lead sheet, the way that we have this from Reynolds is accessed through our CRM. So this is where the salespeople who are in the CRM doing everything they're supposed to be doing for the day, this is where they can access this XtreamService lead sheet. So all of this pre-screen information is available for them right there. We actually recently had a dealership that was adding pre-screen to XtreamService and as they were going through in their training, they realized if I have this on XtreamService leads, am I able to use this within my CRM? And the answer is yes.

And now that helps transition me over to talking about why pre-screening in the CRM is also very important. It's probably a little bit more common than pre-screening in the service lane, but it's still an important piece. So I want to start with making sure we all understand the importance of a CRM screen, and the first is going to be it helps start the approval process early in that sales cycle, which will help lead to less steps down the road when you're working with this customer.

The second is going to be it helps capture every single lead type. So we talked about how we're able to utilize it for our service leads, but what about the other leads in my CRM? Can I use it on internet and phone leads? Maybe if a customer walks into my showroom, you just need a name and an address to run a pre-screen, and you can get a result very quickly. So it makes it so that way you can get that additional information on all your different lead types you have in your CRM.

And then the third is going to be it helps with less intimidation, walking into that F&I office. There's going to be less chance of that unpleasant conversation where a customer can't get financing or maybe they can't get approved for the amount of financing that they need for that vehicle. And that really can help overall just avoid that conversation. I do want to make sure everybody understands that pre-screen doesn't guarantee the customer will be approved. It is still just a pre-approval, but the outcome is still going to be a lot better in that F&I office, if you have a good idea of where the customer stands financially before they walk into the office.

So thinking of that, what are some of the benefits, how we can use that information, and what can you expect to see from a CRM pre-screen? And the first is it's going to help your salespeople to have that tailored approach. It should help increase the number of qualified leads and really help you find the best buyers at the right time and have that right information on what they actually can afford to do. It's going to make the conversation a lot more meaningful and a lot more personal to that customer, because you understand and have a better knowledge of what they can actually afford.

Because of that, it should also improve the closing ratio, because you're able to match the customer to the right vehicle and offer up a payment option that should fit them. This is going to work best for individual customers and based on their current situation. So it can really help tailor that sales approach.

The second is going to be it actually will speed up the sales and F&I process and from a Reynolds perspective especially, it will eliminate rekeying of a lot of the data. So we talked about how even if we start with approaching the customers in the service lane, we have that pre-screen information on the XtreamService lead sheet, which is accessible through the Reynolds CRM. So if I want to look at the information there, it's already all in the same place for me. I also can run a pre-screen on any of those additional lead types I have in my CRM.

And then from there, as far as the sales process is moving along and I push the information over to Desking, the same pre-screen information is available in our Rebates and Incentives as well. So you're not going to have to key in this information over and over again. It is all going to be available depending on where you're looking and where the customer currently is in that sales process.

Overall, that's going to decrease the amount of wasted time in the sales process and it's going to be one less step you have to take once the customer is really in your store and in general, that's going to translate over to that improved customer buying experience. So the customer feels as though you're ready to do business with them because you have a good understanding of who they are and upfront what they can afford. So that should help with that customer experience, which should make them more likely to be a loyal customer and continue to do business with you.

So I know that we talked a lot about the benefits of pre-screening both in the service lane and in sales, but what impact will this have on your growth overall? And I want to just remind everybody of the three different types of data that we went over, that transactional, demographic, and behavioral data to help identify which customers might be the best ones to talk to. But then pairing that with the credit data and history for pre-screen is what's going to deliver an exact pinpoint on where a customer is financially. It's also a different way to market to your customers and plant the seed of purchasing a new vehicle. This means that your sales team can have a wider pool of opportunities of customers who are more likely to purchase. They can approach the customer with a vehicle that is more or less likely to fit their needs and their budget. And in addition, you can be more accurate with the payment proposal when working with that customer. This all should result in higher close ratios and improve the customer retention with your dealership, the customer feels as though you know them and you are willing to go the extra mile to personalize that offer and really work one on one with them.

I hope this time has started to make you think about ways you might be able to incorporate pre-screening into your existing processes or perhaps reevaluate how you're approaching customers. And for my group of dealers that aren't approaching any customers in the service lane. Maybe it's got you thinking that there could be a way to start to approach some of those customers that might help increase your sales overall.

So with that, I just wanted to thank you all for joining today. I know that you guys are busy, have a lot going on, but we do want to open it up for questions. So if there are any questions, I would be glad to help answer some. And I know Ken would also.

SB All right, thank you, Haley. And I'm trying to open up my question dashboard. All right, so first question is, does a soft poll show an inquiry on a consumer's credit report? Ken, you want to take that?

Ken Hill, Managing Director, 700Credit Sure. So soft pulls, only a consumer can see soft pulls. If you get a Capital One pre-approved credit card offer in the mail, if you were to go to Credit Karma or pull your report, you would see a Capital One soft pull. So it's called a soft inquiry that only the consumer can see. In fact, when you log on the Credit Karma and look at your report, that actually replaces a soft inquiry on your credit file as well. When a lender or a dealer does a hard pull, those inquiries don't show and they don't affect the credit score.

SB All right, next question, how would the pre-screen work for those who don't have a service center as part of the dealership? That's a really good question. Hayley, Ken, which one of you'd like to take this?

HH I can at least start, and Ken might want to chime in. There definitely is still benefit because you're still able to use the pre-screen on the sales side as well. Don't think you're limited to not utilizing it just because you don't necessarily have a service lane. There is the benefit of still pre-screening your customers as you get those leads into your CRM, either as an internet lead or as soon as the customer shows up at the dealership. It is a very quick process. So it's a way to easily get an idea of where the customer stands financially.

KH Perfect. That's the right answer. Pre-screen is more about the credit score and the CRM, but it also still provides their trade in, how much they owe on the trade. And so you get an idea of equity, current payment, and interest rates so you can get an idea on budget. So you're getting that information at the top of the sales funnel, and it helps you quote payments to the consumer earlier on in the sales cycle so you can get them in the right vehicle or adjust it, rather than wait for the finance office to quote a payment and then go from there and lower your price to get them to a closer payment so you can save on growth. So, yes, there's still a lot there across our customer base; dealers find as much value in the CRM as they do in the service lane.

SB All right, very good. And we have a compliment; this is not a question, just a compliment well put together. Thank you for the information. Well, thank you, Andrew. That was really nice of you to say. We appreciate that. And I'm sure Hayley does. Anybody else have any final questions for us? All right, if not, we'll wrap up the session, You'll all be getting an email from us with links to the video so you can share with your friends at work, links to this deck and links to forms you can fill out and we will call you and answer any other questions, one on one with you. All right, thank you, everybody. Thank you, Hayley. We've really enjoyed having you be part of our guest speaker series this month. Appreciate you taking the time to do this for us.

HH Thank you for having me.