(Re)Connect with Members to Improve Loyalty and Retain Loans

Driving auto loans through the member channel is vital to success in today’s marketplace.


In today’s highly competitive lending landscape, credit unions need to incorporate strategies and programs that will effectively give them a marketplace advantage and help grow their auto lending success. Credit unions need to be pro-active in going after auto lending opportunities. Establishing a solid game plan that drives auto loans through the member channel provides the greatest opportunity for building strong auto loan portfolios.

Banks and other lending institutions have regained market share in 2010, effectively minimizing the gains credit unions made between 2008 and 2009. At the mid-year point, banks had captured 36% of the auto lending market share, finance companies 28%, and captives 19%. Credit unions held 17% of the market place. This is quite a shift from last year, when credit unions held 22% of the auto lending market.

The competition is aggressively pursuing consumer auto loans, and credit unions’ ability to recapture market share and grow loans depends largely on their ability to advance member loyalty and retain loans. Credit unions must fully engage members through the entire vehicle buying process, beginning with the auto shopping experience.

According to JD Powers, 77% of new car buyers shop the Internet for their next vehicle; the Internet is the primary purchase vehicle for nearly 50% of used car buyers. The Internet is becoming an important part of the vehicle purchasing process. According to Cobalt Group’s Dealer eBusiness Performance Study, 88% of consumers use the Internet for research prior to visiting a dealership.

To retain member connections and create new loan opportunities, credit unions need to incorporate strategies and programs that utilize today’s popular digital technology, such as mobile devices. Leveraging this technology provides an effective way for credit unions to market loan products, strengthen member loyalty, and capture more loans.

Carat’s 2010 New Shopper Journeys Survey revealed “a high degree of receptiveness among shoppers to newer forms of digitally driven channel engagement, most notably mobile, to aid their decision-making process and ultimate purchase, particularly during that last ‘arm’s reach’ point just before final sale.” According to the survey, 38% of U.S. shoppers said they used their mobile devices prior to buying products in-store.  

Additionally, the Mobile Marketing Association’s (MMA) July 2010 U.S. Mobile Consumer Briefing noted that almost half of U.S. adult mobile users expect to access websites from their mobile phone over the next year.

For a competitive edge in today’s marketplace, credit unions must adopt new ways to connect with their members’ early in the auto buying experience to help drive loan activity.

CUDL’s new AutoSMART Apple iPhone App (application) gives credit unions a new tool to stay connected with members throughout the vehicle buying process, which improves member loyalty and improves credit unions' ability to retain member financing. The new app gives members the ability to shop for vehicles, research vehicles, and access pre-approved credit union loans from their iPhones as well as from other Apple products, including the iPad and iPod Touch.

“The AutoSMART iPhone application is our first step in changing the automobile purchasing process by giving the consumer control over their financing while sitting in the F&I office,” says Kip Haas, executive vice president of products and technology at CUDL.

The new app incorporates content from the CUDL AutoSMART website’s extensive library of research tools, which includes an advanced vehicle search that allows users to search by make, model, and year, helpful car-buying articles, affordability and payment calculators, vehicle trade-in values, and credit union financing confirmation.

“Our goal was to provide a dynamic research tool that leveraged the AutoSMART site to further simplify members’ approach to vehicle shopping, while also helping our credit unions to stay connected with their members throughout the car buying process, and helping dealers to connect with customers,” says Tony Boutelle, president and chief executive officer of CUDL.

As a credit union-owned service organization, CUDL develops dynamic solutions as well as training and marketing programs to help credit unions more effectively market vehicle lending to members and achieve their auto lending goals.

If your credit union is interested in learning more about proven strategies and solutions to grow member auto loan penetration and overall lending success, contact CUDL at 877.744.2835 or visit www.cudl.com.



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