By Zach Hicken
Alpha Warranty is here to support you in making your Finance and Insurance department (F&I) as profitable as it can be. We provide some of the best products in the industry and back them up with award winning support. Our sales system called “Zoom,” makes it easy for you to take the consultant approach with your clients, showing them multiple options to choose from. If you would like a training on how to use this powerful tool to enhance your sales, schedule a call today for one of our sales team to provide a training.
The F&I department is where great profits can be realized, and Vehicle Service Contracts are an important part of a dealership’s F&I offerings. Selling a VSC can be much more difficult than selling a vehicle as there are some concerns and constraints that really make it a different experience. In this quick guide we’ll review some important factors to consider; the approach, the timeframe, and the delivery. Your sales, and those of the dealerships you work with, will certainly increase if you follow this guide.
Nobody wants to be sold. One way to avoid customers feeling that way is for you to remain aware that people make purchases based on what the product will provide, not just the product itself. In other words, they don’t buy a Vehicle Service Contract, they buy what the VSC provides; they buy a way to save money on car repairs, or they buy peace of mind knowing that they can be covered in the event their vehicle needs an expensive repair. The only way to know what they want is to talk to them and understand what motivates them. In this approach you effectively become a consultant, not a salesperson.
So, what’s the difference between a consultant and a salesperson? A consultant starts by finding what a person needs. A consultant won’t just be thinking about their own products or services. They will be focused on what their client is saying and the client’s vulnerabilities to achieving their goals. A consultant will also guide a client to better understand the opportunities available that address those concerns, including opportunities the client hadn’t previously considered.
Let’s compare how this approach is different from an approach typically used by a salesperson. Let’s say a customer says that they plan on using their car to commute to work. A salesperson might explain that a VSC would help them pay for a repair that might otherwise make them miss work. The salesperson would then pull out a rate card for a VSC, and start selling.
On the other hand, a consultant would begin by asking some questions like, “Where do you work?”, “How long have you worked there?” “Do you plan on using the car for more than commuting? Would you perhaps use the vehicle to take a vacation?” “How many miles do you estimate you will put on your car each year?” “If a breakdown should occur, where would you feel it the most?” Once the consultant knows more, then they could suggest different VSCs that would be the best fit for their customer using language like, “Based on what we’ve discussed, I would recommend these Vehicle Service Contracts because… Which one do you think best covers the needs we’ve discussed?”
In summary, make sure the customer knows you are listening, understanding and empathizing, not just hearing what they say so you can rattle off a pre-programmed response.
Customer demand for a VSC could be plotted on a bell curve. There are roughly twenty percent of people who already want a VSC, they may even ask for it before you can offer one. There are another twenty percent that are absolutely against buying one, and no amount of explaining will change their mind. That leaves sixty percent that may purchase one if they are presented the right information delivered in the right way.
As you get to know the customer, focus on understanding what they value most. Each person has a slightly different value set. While some want a quick and high-level description of products, others want every detail to be explained before deciding. Some people will respond favorably to the word “contract” because they want predictability, while others will be put off by the word because they feel contracts take away their freedom. The important thing to remember is to present based on their values, not necessarily your values. When you talk about things that a person cares about, and avoid things they don’t, they are more open to listen to what you have to say.
One of the most common challenges about the F&I process is by the time a person gets to your office they’ve already been working on this deal for a long. Their patience is either gone or almost gone. So, what’s the solution? You can either learn to talk like an auctioneer or find a way to prepare customers to help them understand your role and how talking to you can add value to their purchase.
One way to accomplish this starts on your website. By adding basic information about VSCs, especially the benefits they provide, you can prepare customers to be willing to learn more. A banner telling them that the F&I department can help them realize even greater value can prepare them for another step along the purchasing journey. People naturally reject things they don’t understand, so provide a way for them to understand your role and VSCs before they are brought into your office.
Another technique is to encourage your salespeople to mention VSCs at least once during their sales process. They could say something along the lines of, “One of the things I like about this truck for you is that it qualifies for a VSC.” The point here is that they are planting seeds. In most cases, they shouldn’t go into detail about VSCs, instead they should deflect questions by saying, “our F&I person would be able to advise you on that better than I could, and I want to make sure you get the best options available.” Later, when the customer is brought to the office, the salesperson can reference their VSC conversation, setting you up for a better experience with the customer.
After the sale
The delivery after the sale is one of the most valuable moments in the sales process but is often the step that gets the least amount of attention and planning. This is where it’s the easiest to make a big impression because it doesn’t take much to exceed expectations. The customer probably expects you to put all the documents in a folder with your logo on it. They expect you to thank them for their business and a handshake. Then they expect to leave your office and completely forget your name, face, and everything you said. What are you going to do to make a good impression and make them want to return and do business with you again?
Here’s list of ideas, you can use any of these, or maybe they’ll give you some ideas of your own to use.
- Compliment them on their choices, citing a specific reason why you think they chose well.
- Instead of sliding your card in the folder, present it to them while encouraging them to call you with any questions.
- Give them a gift, like a gift card to a local restaurant or a gas station.
- Call them the next day to see if they felt some excitement to drive their new car to work.
- Take a picture of them with their new car with your camera and their phones
- Introduce them to your service manager or give them the card of a mechanic you know and trust, just in case.
- Hand write a short thank you note, mentioning one detail about them that shows that you paid attention to what they told you. Put the note in the glove box to be found later.
In conclusion, in any interaction, people want to feel important, valued, and appreciated. Helping your customers feel listened to and guided in their decision to purchase something as important and expensive as a vehicle will return big dividends when the time comes to offer a VSC and the next time they need a vehicle.
Zach Hicken has spent the last twenty years helping companies increase their value through effective marketing efforts. His specialty is digital marketing, which includes SEO, SEM, social marketing, and email marketing. He has been part of the Alpha Warranty marketing team since 2018.