Five years in the making and six months on the market, Cox Automotive’s Accelerate online shopping tool has expanded to include nearly 3,000 dealerships nationwide. And it’s paying off for the finance and insurance department.
F&I profit per vehicle at dealerships using Accelerate has increased 53 percent, Autotrader General Manager Jessica Stafford told Automotive News.
Shoppers using Accelerate can receive a value for their trade-in through Kelley Blue Book’s Instant Cash Offer, view content on F&I products with dealership-specific pricing and secure online financing and approvals.
Accelerate also lets consumers calculate monthly payments through several metrics, accept terms of a deal, reserve a vehicle with a deposit and schedule an appointment to test drive the vehicle and complete the purchase.
Accelerate is available to more than 2,200 dealerships through their Autotrader and Kelley Blue Book listings and to about 575 dealerships through their Dealer.com-powered websites.
After a pilot launch of Accelerate for Las Vegas dealerships using Cox Automotive’s Autotrader and Kelley Blue Book websites in March, more than 10,000 vehicles — roughly 43 percent of Autotrader’s Las Vegas inventory — were available with Accelerate.
In August, 15 percent of Autotrader’s total inventory — or more than 560,000 vehicles — was listed with Accelerate.
F&I product boost
Accelerate can cut the time customers spend in the F&I office, the company says, by letting them handle as much of the transaction online as they choose. Cox Automotive’s Future of Digital Retail Study shows that 63 percent of consumers who conduct their research online are more likely to buy F&I products, Stafford said.
Ken Lemler, director of operations and process at McKenna Cars in Norwalk, Calif., finds that customers ask more questions about F&I products after previewing them online, and are open to buying the products without an in-person pitch.
“Customers are so wide-ranging in the way they want to engage with us,” Lemler said. “With the Accelerate tool especially, it allows the customer to engage the way they want to.”
At Subaru of Las Vegas, one of the first stores to sign up for Accelerate, more than 3,400 customers use the tool through Autotrader, said Robert Baugh, Internet marketing director. With a 30-day new-vehicle supply typically, the store turns inventory quickly. But, Baugh said, for F&I product sales, sometimes it’s best to sell in person.
“You have to have somebody that’s there sitting in front of you” to explain some of the intangible back-end products, such as service contracts, he said.
Dealerships and their lenders can choose whether to include finance reserve, or the retail margin the stores earn for arranging a loan, in Accelerate transactions.
McKenna’s BMW dealerships work with four to five lenders, while the Audi store has about eight. The stores have a small reserve on used-car deals, but stick with the buy rate for new vehicles.
“We want the payment to be attractive enough to engage them in the product,” Lemler said.
Customers in control
Baugh, however, makes finance reserve on loans arranged through Accelerate. He works with three to four lenders through the program. With these lenders, customers enter their credit scores and Accelerate shows them interest rates based on that information.
“It still allows customers to really be in control of their auto purchase journey,” Baugh said, ultimately leading to a “lower-in-the-funnel, more engaged, higher probability of purchase customer.”
Dealerships using Accelerate also have higher engagement rates and receive higher-quality leads, compared with their non-Accelerate transactions.
McKenna Audi, one of 10 dealerships to participate in the Accelerate digital retailing beta in November, previously sold 40 to 45 vehicles per month on average. Since using Accelerate, the store sells around 80.
Aside from sales, Lemler said he has seen more customer engagement online. “We are seeing more and more engaging with our chat,” Lemler said. “They’re asking more detailed questions versus just generic, ‘Hey, what’s your best price?’ ”
Dealerships that use Accelerate are increasing sales leads 15 to 40 percent, depending on their advertising, a Cox Automotive spokesman said. For some dealerships, closing rates have been between 30 and 50 percent through Accelerate, compared with a typical 8 to 11 percent closing rate on leads from dealership websites, he said.
Dealerships that have implemented strategic marketing tactics have had the most successful closing ratio, said Stafford. Stores that use Accelerate without marketing close 15 transactions per month through the service on average, while dealerships that advertise Accelerate close 40 deals per month, she said.
“The closing ratio has been highly dependent on the marketing, getting people in the door, and how the dealership staff handles the customers at that point,” Stafford said. “It all ties back to being able to educate consumers on what this is and then treat them the right way once they get into the dealership.”
This study has captured key changes in consumer buying behaviors and attitudes for the past 11 years. To say 2020 was challenging would be an understatement, there were many hardships, but the tiny silver lining is that the pandemic brought positive changes and efficiencies to the car buying process.
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