Digitalisation is an opportunity, not a threat

Spencer Halil discusses digitalisation of the sales process and its effect on finance commissions.

Digitalisation is an opportunity, not a threat

Digital innovation is constantly transforming the way businesses operate.

As an industry, we are continually evolving. Technology is moving at an ever-faster pace and it is essential that we listen to our customers, monitor their changing demands and interactions and ensure the products we deliver in the future suit the needs of an evolving financial marketplace.

The sales process has become increasingly digitalised and it is important for car finance providers and dealers to move with the times. Just because something has worked for the past five years, doesn’t mean it will for the next five years; future-proofing is essential.

With the inevitable change comes concerns over the possible lowering of finance commissions and increases in car prices. However, there are numerous market conditions which have an impact and no one factor is necessarily more influential than others. It is important to embrace new ways of doing business, while keeping traditional values that are still so important to customers. Profitability does not have to suffer just because we are doing things slightly differently.

Dealers should be taking full advantage of all the latest technology available to help walk customers through the finance process in the most convenient, accessible and easy to understand manner. Long gone are the days of finance deals being struck in a back office, away from the prying eyes of the customer.

In context of the fast digitalisation of the pre-sales phase, the amount of data at the disposal of consumers to shape their purchase decision is growing at a steady pace; many will have done extensive research in advance. However, it is apparent that, despite the information available, many customers still find the sector confusing and are not clear on the benefits of different finance solutions. Therefore, face-to face relationships continue to be very important to many customers and technology cannot replace this confidence-boosting personal interaction.

There will always be space for consumers who want to engage with dealers in a physical showroom environment. Salespeople must remain approachable and knowledgeable, as well as being able to explain the different options available to people in a clear way. Dealers need to be open and transparent, ensuring consumers feel like they are part of the finance process.

Overall, the car finance sector has welcomed the benefits offered by interactive websites, digital outlets and social media, which give an additional platform to deliver strong messages and special offers. We work closely with our partners to ensure they understand how to effectively communicate with their target audience, drive people into their dealership and keep key stakeholders informed through whatever channels are available.

Social media, for example, is a very cost-effective way to reach customers and engage with stakeholders, and a brilliant tool to build a profile. However, it is important to remember that Facebook, Twitter and so on are just additional channels with which to communicate with the customer. All forms of communication are integral to ongoing success.

At ALPHERA, we believe technology provides opportunities rather than threats; it is there to facilitate the process of finance, not to overshadow it.