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Shifting Power To The Member

Online search tools and personalized concierge service help savvy credit unions market vehicles and lending as a single event to members.

Typically, the question of financing the purchase of a new vehicle isn’t considered until the choice of the vehicle itself has been made. Without a pre-approved financing solution, most buyers up to 90%, according to recent studies rely on the dealership for loan guidance and funding. Now, however, credit unions have the means to change all that.

By leveraging the latest in online search tools with a member-friendly, personalized concierge service, savvy credit unions can market both the vehicle purchase and the loan as a single event to their members. And, in the process, they can reap big rewards for both themselves and their members.

Greater Nevada Credit Union ($489M, Carson City, NV) is one such institution. Our goal is always to create value for our members, notes Kerstin Plemel, vice president of marketing.

Our new concierge-style approach involves assigning a credit union representative to work right there at the dealership, Plemel says. That representative is on hand to personally take care of each member’s needs throughout the entire buying process. The member gets the best rate and the best experience, while the credit union gets the loan. We’re very excited because of the immediate positive reaction it received. It’s good for membership, and it’s good for the credit union, too.

Julie Kinney, senior manager of indirect lending at Summit Credit Union ($2B, Madison WI), agrees.

We have relationships with key dealerships that we view as partners, she says. We want our members to be comfortable in their purchases, so we push the members to our dealer partners, and our dealer partners push them back to us for financing.

The whole idea is that the member will get the best deal, Kinney says. And having the same point person at the dealership means that the buyer experience will always have the same feel,’ that it will be consistently good for our members.

For Andrea Pruna, vice president of marketing at Northeast Credit Union ($988M, Portsmouth, NH), guiding members to make wise decisions about purchases is a major credit union responsibility. We have always taken a very active approach toward urging our members to use our AutoSMART website to research their next vehicle, she says, and our implementation of concierge services feels like a natural extension of that. Anything that provides a better experience to our members is something we want to explore.

The way millennials research vehicle buying options and dealers is changing the process for everyone.

Oh, That New Car Smell

Prior to today’s digital era, buyers had fewer options for financing, and dealerships simply informed the buyer what the monthly payment would be. The buyer signed the contract, took the keys, and drove off the lot.

This left advertising agencies free to focus exclusively on the emotional aspect of the purchase, a sleek cruise down the highway with smiling models, hair waving in the wind. It’s no surprise then that financing is perceived as less romantic than that new car smell. The emotions of a new vehicle purchase are indeed all about the car, according to the JD Power 2013 Sales Satisfaction Index Study.

Internet Changes The Art Of The Deal

As the Internet age has continued to evolve, however, consumers have increasingly embraced doing their own vehicle research online, long before they visit a dealer.

According to a recent article on CNBC.com titled, How Millennials are Reshaping Car Buying, the way millennials research vehicle buying options and dealers is changing the process for everyone.

Going into the car buying process, millennials are notably less likely to have any idea what sort of vehicle they want, notes the article. But by the time they walk into a showroom, they’re far more likely to have a specific model and brand in mind. A full 95% of millennials said they went online during at least part of the buying process.

At the same time, consumers are making buying decisions based on how they feel about a company and its offer, a new trend called emotional branding.

Today, combining the convenience of online vehicle shopping with a personal, high-touch concierge service, has become the new standard in member lending. It enables credit unions to take a powerful, two-pronged approach that drives the buying experience from shopping to sale, while ensuring member satisfaction every step of the way.

Good For The CU And The Membership

For credit unions, this approach both deepens the relationship with members and helps grow its loan portfolio. For the member, it ensures the most pleasant buying experience, while getting the best deal.

We’ve gotten great feedback, says Marcus Wertz, Greater Nevada’s vice president of consumer lending. Almost immediately, it generated a great deal of interest with our members. We expect great things from the program.

Credit union thinking behind the program is simple: unite the processes of purchase and financing into a single positive buying experience in order to stop the loan from becoming an afterthought and losing it to a competitor.

As Plemel, the Greater Nevada marketing vice president, concludes, When considering the concierge approach, every credit union should look at what their members need. In most cases it would be a great thing.

CU Direct introduced its AutoPREMIER concierge service to credit unions in 2013. The program provides credit unions with a solution that helps streamline the member experience while leveraging the service to drive auto loans. AutoPREMIER takes the auto shopping experience to a new level, with a more personalized approach that offers amenities, such as haggle-free pricing on new vehicles and special purchase incentives on pre-owned cars.

This article originally ran on CreditUnions.com on Oct. 6, 2014.

This article is sponsored by a recognized solutions provider in the credit union industry. Callahan & Associates does not endorse vendors or the solutions they offer, and the views and opinions offered here might not reflect those of Callahan. If you are interested in contributing an article on CreditUnions.com, please contact the Callahan team at ads@creditunions.com or 1-800-446-7453.
October 14, 2014

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