Two years ago I spent 3 days in New Orleans at an NADA show that was more frustrating than anything that I could imagine. 

Not only did I have to contend with slashed ad budgets, but it seemed like half of the folks that I spoke with were convinced that special finance was dead and would not experience a Lazarus-like return.  Most of the people seemed to pity me, seeing our auto finance marketing products as a once-great idea whose time had come and gone. 

I was basically trying to sell encyclopedias at a Google convention.

While most people gave me a polite brush off, one General Manager decided that he would take a half-hour to explain to me why subprime could never come back.  Armed with some CNN sound bites and some out-of-context data from Automotive News, he gave quite an impressive soliloquy on the brave new world of auto finance.  I, of course, tried to explain my belief that our industry would not tolerate a vacuum for long, and with credit scores dipping some banks would figure out a way to structure their programs to fill the void.

His final words as he walked away from our booth were “I like that you can come up with reasonable arguments to support a fundamentally flawed position, once you guys go out of business give me a call and I may have a spot for you”.  He laughed and walked on to his next session, while I shook his comments off and looked for the next person who would give me a few minutes to chat.

I was reminded of this story earlier this week when I got a call from the same GM. 

He’s now the Finance Director for another store, and obviously didn’t remember me, but I sure remember him.  He spent about 5 minutes telling me about his research that showed special finance was going to come back soon, and he was thinking about buying some leads. I shared with him that subprime had already come back, and that the banks had created programs that helped get people into cars without setting us up for another mess in a few years. 

I’d be lying if told you I didn’t get some pleasure out of telling him that he’d missed out on the opportunity to get in early, and that I was sold out of leads in his market. 

Bob Harwood is the National Sales Manager for Carloan.com. Prior to joining Carloan.com six and half years ago, he worked on both sides of the financing process -- first at Capital One and then at a dealership here in Richmond. You can reach Bob at 804-521-8581 or via email at bharwoodATcarloan.com.

Two years ago I spent 3 days in New Orleans at an NADA show that was more frustrating than anything that I could imagine. 

Not only did I have to contend with slashed ad budgets, but it seemed like half of the folks that I spoke with were convinced that special finance was dead and would not experience a Lazarus-like return.  Most of the people seemed to pity me, seeing our auto finance marketing products as a once-great idea whose time had come and gone. 

I was basically trying to sell encyclopedias at a Google convention.

While most people gave me a polite brush off, one General Manager decided that he would take a half-hour to explain to me why subprime could never come back.  Armed with some CNN sound bites and some out-of-context data from Automotive News, he gave quite an impressive soliloquy on the brave new world of auto finance.  I, of course, tried to explain my belief that our industry would not tolerate a vacuum for long, and with credit scores dipping some banks would figure out a way to structure their programs to fill the void.

His final words as he walked away from our booth were “I like that you can come up with reasonable arguments to support a fundamentally flawed position, once you guys go out of business give me a call and I may have a spot for you”.  He laughed and walked on to his next session, while I shook his comments off and looked for the next person who would give me a few minutes to chat.

I was reminded of this story earlier this week when I got a call from the same GM. 

He’s now the Finance Director for another store, and obviously didn’t remember me, but I sure remember him.  He spent about 5 minutes telling me about his research that showed special finance was going to come back soon, and he was thinking about buying some leads. I shared with him that subprime had already come back, and that the banks had created programs that helped get people into cars without setting us up for another mess in a few years. 

I’d be lying if told you I didn’t get some pleasure out of telling him that he’d missed out on the opportunity to get in early, and that I was sold out of leads in his market. 

Bob Harwood is the National Sales Manager for Carloan.com. Prior to joining Carloan.com six and half years ago, he worked on both sides of the financing process -- first at Capital One and then at a dealership here in Richmond. You can reach Bob at 804-521-8581 or via email at bharwoodATcarloan.com.

Of the many territories I deal with for auto finance marketing programs, there are a few states that I would like to focus on in the coming year and they include Texas, Minnesota, and Wisconsin.

Some dealers may argue that they get special finance customers in by the dozens, but aren’t closing deals!   Should they have to deal with 10 special finance visitors to get a deal or is the number more like 100?

Like everything else, it is a numbers game.

How many customers do you need to see to deliver one car and what does it cost you?  Some dealers I speak to say they have too much sub-prime traffic now and don’t want to “pay” for more of it. Whether you have a ton of special finance traffic or not, if you have the right basic lenders, inventory and people in place, you can be successful in the subprime arena and keep your cost per delivery below $300.

Here are some ways for dealers to ensure success, especially when dealing with special finance customers:

• Bring in all customers who reach out, don’t cherry pick.
• Get them approved by working the deal backwards:

1. Discuss their credit with them and select four or five vehicles that best suit their credit/ what they are approved for and work from there
2. Talk to them about the types of car they are interested in
3. Show them the cars that match what they qualify for

• Finally and most importantly, treat them well whether they are approved or not.

Think about this quote: “Everyone will buy a car.  Question is, will they buy it from you?”  Are you doing enough to make sure you’re the guy?

One thing I have found in my numerous, daily conversations with dealers across the country is:  You either want to do subprime or you don’t.  At the end of the day, you are either all the way in or you should stay out.

Mike Gray is an auto finance marketing consultant for Carloan.com. He has helped with dealers with their marketing programs in various roles for Carloan.com since 2004. You can reach Mike at 804-521-8578 or mgrayATcarloan.com.

Of the many territories I deal with for auto finance marketing programs, there are a few states that I would like to focus on in the coming year and they include Texas, Minnesota, and Wisconsin.

Some dealers may argue that they get special finance customers in by the dozens, but aren’t closing deals!   Should they have to deal with 10 special finance visitors to get a deal or is the number more like 100?

Like everything else, it is a numbers game.

How many customers do you need to see to deliver one car and what does it cost you?  Some dealers I speak to say they have too much sub-prime traffic now and don’t want to “pay” for more of it. Whether you have a ton of special finance traffic or not, if you have the right basic lenders, inventory and people in place, you can be successful in the subprime arena and keep your cost per delivery below $300.

Here are some ways for dealers to ensure success, especially when dealing with special finance customers:

• Bring in all customers who reach out, don’t cherry pick.
• Get them approved by working the deal backwards:

1. Discuss their credit with them and select four or five vehicles that best suit their credit/ what they are approved for and work from there
2. Talk to them about the types of car they are interested in
3. Show them the cars that match what they qualify for

• Finally and most importantly, treat them well whether they are approved or not.

Think about this quote: “Everyone will buy a car.  Question is, will they buy it from you?”  Are you doing enough to make sure you’re the guy?

One thing I have found in my numerous, daily conversations with dealers across the country is:  You either want to do subprime or you don’t.  At the end of the day, you are either all the way in or you should stay out.

Mike Gray is an auto finance marketing consultant for Carloan.com. He has helped with dealers with their marketing programs in various roles for Carloan.com since 2004. You can reach Mike at 804-521-8578 or mgrayATcarloan.com.

The question that dealers consistently ask me is “what are the keys to success on your special finance leads program,” or “how do dealers close 15% or higher of your auto finance leads when we struggle to close 5%?”  Obviously access to lenders and inventory are key, but let’s assume that we are talking about a dealership that is committed to subprime with the knowledge and resources to get credit challenged customers approved.

Possibly the easiest way to identify the keys to success is to first identify the recipe for failure. 

Typically failing dealers have a few things in common: 1.) They do not contact the leads in a timely fashion 2.) They prequalify the customers before they contact them. 3.)  When they do contact the customer, they try to sell the car not the appointment.

For now, I would like to focus on the last of these issues.

The first thing that we have to realize is that it doesn’t matter what a customer’s credit score, income, or cash down situation is if we cannot get that customer into the dealership.  One common mistake that experienced sales or finance people make is to get into too much detail over the phone.  Talking about cash down or specific inventory will do nothing more than discourage a customer from coming in to the dealership.

Once a customer is face-to-face, it is much easier to control the situation and direct the individual towards a car that not only fits their needs but is a finance-able option.  When the customer is able to feel, touch and experience the car, they are much more likely to find extra money down or convince someone to cosign for them.

Some dealers attempt to get a customer approved before they set an appointment and bring them in.  The major issue with that is when you tell a customer they are approved,  you take someone who thought no one could help them and turn them into a shopper that will go to any dealer across town.  The key is to sell the appointment and take the customer out of the market.  Invite the customer down and let them know that you have access to a wide variety of used cars as well as a variety of lenders who are experienced in working with less than perfect credit.

Create a sense of urgency by letting them know you need to verify their information in order to secure financing and set an appointment within 48 hours.  Going into any further detail with the customer will only limit opportunities and result in fewer car sales.  So remember SELL THE APPOINTMENT NOT THE CAR!!

Brian Matthews is an account executive for Carloan.com. He has been helping dealers with their sales and marketing processes since 2007. You can reach Brian at 804-521-8569 or bmatthewsATcarloan.com.

The question that dealers consistently ask me is “what are the keys to success on your special finance leads program,” or “how do dealers close 15% or higher of your auto finance leads when we struggle to close 5%?”  Obviously access to lenders and inventory are key, but let’s assume that we are talking about a dealership that is committed to subprime with the knowledge and resources to get credit challenged customers approved.

Possibly the easiest way to identify the keys to success is to first identify the recipe for failure. 

Typically failing dealers have a few things in common: 1.) They do not contact the leads in a timely fashion 2.) They prequalify the customers before they contact them. 3.)  When they do contact the customer, they try to sell the car not the appointment.

For now, I would like to focus on the last of these issues.

The first thing that we have to realize is that it doesn’t matter what a customer’s credit score, income, or cash down situation is if we cannot get that customer into the dealership.  One common mistake that experienced sales or finance people make is to get into too much detail over the phone.  Talking about cash down or specific inventory will do nothing more than discourage a customer from coming in to the dealership.

Once a customer is face-to-face, it is much easier to control the situation and direct the individual towards a car that not only fits their needs but is a finance-able option.  When the customer is able to feel, touch and experience the car, they are much more likely to find extra money down or convince someone to cosign for them.

Some dealers attempt to get a customer approved before they set an appointment and bring them in.  The major issue with that is when you tell a customer they are approved,  you take someone who thought no one could help them and turn them into a shopper that will go to any dealer across town.  The key is to sell the appointment and take the customer out of the market.  Invite the customer down and let them know that you have access to a wide variety of used cars as well as a variety of lenders who are experienced in working with less than perfect credit.

Create a sense of urgency by letting them know you need to verify their information in order to secure financing and set an appointment within 48 hours.  Going into any further detail with the customer will only limit opportunities and result in fewer car sales.  So remember SELL THE APPOINTMENT NOT THE CAR!!

Brian Matthews is an account executive for Carloan.com. He has been helping dealers with their sales and marketing processes since 2007. You can reach Brian at 804-521-8569 or bmatthewsATcarloan.com.

I spent a couple of days last month at the Washington DC edition of the 4^th annual ADM conference.  This was the first year they had split the conference up into different markets, but I was still able to learn quite a bit from chatting with the 9 dealers and the lenders in attendance.

Luckily the assembled cast represented the full spectrum, from polished special finance professionals looking to hone their skills to a dealer principal who knows that he needs spi fi but doesn’t know how to get it up and running.  When I came back to the office here at Carloan.com and started reading through the notes I had taken, the generally accepted ingredients for success were:

• The store must commit to sub prime from the top down
• Have the right cars
• Have the right banks and understand their programs
• Constantly train your people

This seems so simple on paper, but every dealer I speak to that tells me they can’t make special finance work is deficient in one of these areas, often without realizing it.  Lenders really seem to be the biggest stumbling block, and the differentiator between successful special finance shops and those that struggle.  This was pointed out in stark detail as I listened to three folks discuss the same lender.  All three were from the same state, but all had very different experiences.

Dealer A said that they couldn’t get a deal hung with the bank to save their life, Dealer B said they were OK, but didn’t buy a majority of the deals she sent, but Dealer C swore by the bank and said that if not for this bank their secondary department would be in trouble.  Same state, same bank, same program, very different results, so why such different results?  Dealer C knows the bank’s programs inside and out, and structures his deals to fall in their sweet spot, while the other two structure their deals generically and shoot them to a few banks hoping for a good call.

If you haven’t spoken to your bank reps in a while, take a few minutes to pick up the phone and call them.  Find out what their perfect deal looks like, and how you can tweak what you’ve been sending to get some better calls.  Remember, those folks get paid on how many deals they book, so they want your business and will take all the time necessary to help you understand their programs.

Bob Harwood is the National Sales Manager for Carloan.com.  Carloan.com has been generating auto finance leads and special finance leads since 1989.

I spent a couple of days last month at the Washington DC edition of the 4^th annual ADM conference.  This was the first year they had split the conference up into different markets, but I was still able to learn quite a bit from chatting with the 9 dealers and the lenders in attendance.

Luckily the assembled cast represented the full spectrum, from polished special finance professionals looking to hone their skills to a dealer principal who knows that he needs spi fi but doesn’t know how to get it up and running.  When I came back to the office here at Carloan.com and started reading through the notes I had taken, the generally accepted ingredients for success were:

• The store must commit to sub prime from the top down
• Have the right cars
• Have the right banks and understand their programs
• Constantly train your people

This seems so simple on paper, but every dealer I speak to that tells me they can’t make special finance work is deficient in one of these areas, often without realizing it.  Lenders really seem to be the biggest stumbling block, and the differentiator between successful special finance shops and those that struggle.  This was pointed out in stark detail as I listened to three folks discuss the same lender.  All three were from the same state, but all had very different experiences.

Dealer A said that they couldn’t get a deal hung with the bank to save their life, Dealer B said they were OK, but didn’t buy a majority of the deals she sent, but Dealer C swore by the bank and said that if not for this bank their secondary department would be in trouble.  Same state, same bank, same program, very different results, so why such different results?  Dealer C knows the bank’s programs inside and out, and structures his deals to fall in their sweet spot, while the other two structure their deals generically and shoot them to a few banks hoping for a good call.

If you haven’t spoken to your bank reps in a while, take a few minutes to pick up the phone and call them.  Find out what their perfect deal looks like, and how you can tweak what you’ve been sending to get some better calls.  Remember, those folks get paid on how many deals they book, so they want your business and will take all the time necessary to help you understand their programs.

Bob Harwood is the National Sales Manager for Carloan.com.  Carloan.com has been generating auto finance leads and special finance leads since 1989.