Is social media really the future for car finance? Grant Collinson and Richard Brown put the questions to three industry experts.
Katie Streten, senior creative strategist, Ford account, at creative communications agency Imagination.
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What does Imagination do for Ford?
Imagination works for Ford around the world to create anything from a roadshow to a global autoshow. We do the whole package but we also contribute to their overall marketing efforts. A good example of a marketing and social activation would be a social seeding video plus iPhone app to promote the B-Max.
Are car manufacturers aware of what they want to do with social media?
Yes, they are one of the more adventurous and creative sectors. More often than not, car manufacturers understand brand loyalty, they understand customer service, and they understand the importance of engaging in conversation.
How do you go about delivering a social media package for them?
We start off with who they’re trying to reach. Each car has a different demographic. There’s no good talking to an older, business-car audience in MySpace. Similarly, it’s better to talk to younger, first-time buyers on Facebook or Twitter.
We’ll look at where they are, who the audience is, and what engagement can be created. Once we’ve done that, devised and pitched our ideas, we then combine those with a paid media presence and a social outreach.
What implications would the embrace of social media by brands have for how they can sell finance?
They would have to be clear about who they partner with. They’ll need someone who reflects their social ethos. One of the important things about social media is that it can be about messaging as long as that’s done in an effective, creative way – places like YouTube and blogs are good spaces for giving opinion and clear information.
YouTube and the right blogs are really good places to get people to understand how financing works, who your partners are and why they’ve been chosen.
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By GlobalDataHow does social media help brands retain customers?
It helps them reinforce values, particularly with cars, which are a big purchase. Everybody wants to talk about the brands they love to other people. It becomes a part of who you are.
Just by maintaining a very low-level conversation with people who already feel part of the brand is a fantastic way to keep front-of-mind. When the time comes for purchase, you maintain your loyalty and might be better informed about your next car because of the social media you’ve received in the intervening years.
That can be straightforward blogs, Facebook pictures, or it can be specific responses to customer service issues, which is a way car brands can engage with maintaining loyalty.
What are the pros and cons of having a company’s name out in social media?
People have always been talking about brands. It’s just that they haven’t been doing it in a space where you could see it. The great pro about social media is that if you know somebody’s talking about you, you can address that.
If they’re talking about you in a positive light, you can thank them. If they’re talking about you in a negative light, you try to answer that question. Increasingly, with the kind of social media monitoring software available now, it’s perfectly possible to do that. You can turn a brand detractor into a brand advocate.
You can also reach people who would not necessarily have considered you. Because you’ve become part of a more general conversation with people who are talking about other brands, it gives the chance to impact on new people.
Roland Schaack, managing director, Codeweavers, the Stafford-based software development company offering point of sale systems, finance calculators, payment search and lead generation tools for major automotive brands and dealers.
How involved do you get in the online strategy of companies?
Rather than exerting direct control, we like to think our products and services help influence our customers’ online strategy. Most of our customers have web-marketing agencies that drive their strategy.
What, above all other web products, are companies saying they need?
Finance calculators. The old mindset was to keep your cards close to your chest, not tell customers what your finance rate was.
That’s changing now. People are aware that if they don’t put an offer out there, if they don’t give customers the functionality and interactivity themselves, they’ll go somewhere else to get a loan.
Are you therefore seeing a greater need for transparency?
Companies are realising they need to give customers the information they are after. Perrys are an example of this change. Being an F&I focused dealer group; they were worried adding finance to their website would have a negative impact on their F&I performance.
They added it nearly three years ago and it’s helping to generate sales leads, with a positive effect on F&I results.
We’re working with a lot of manufacturers as well. They believe it helps with lead generation and customer retention. Logically, you’d say it would if you put a decent offer in to your customer and make your cars look more affordable.
We work with several of the prestige manufacturers, where the residual values are a lot stronger so they can reap the benefits of putting their best foot forward. One of our customers, a volume French manufacturer has it on about half their stock through their used car locator. The cars that have dynamic finance examples get 97% more enquiries than the vehicles that don’t have finance on them.
With the rise of social media, are the public demanding a greater transparency when it comes to finance?
There is a greater sense of that, yes. However, we’re finding that dealers are polarised. There are those that ‘get it’, which tend to be the bigger groups or those that are really focused on the web. Then you get other dealers that are still cautious about showing their hand.
My argument is: If you don’t want to show finance on the website, then why not take the price off as well? Then customers really will have to give you a call. Why not take the images off? Then the customer will have to come down to see the car. It defeats the object of the exercise if you don’t have that information on there.
Are finance companies beginning to ‘get’ social media?
Unfortunately, I don’t see it. Finance companies are more involved in financial interactivity than social media. I recently visited Reevoo, a very slick consumer reviews company, to talk about social media and our industry.
Every time somebody buys a Kia they get sent an e-mail from Reevoo saying: “As a new purchaser of Kia, would you like to review your car and tell us what you think of it? If there are other people interested in buying a Kia, would you be prepared to answer questions?”
Quite a high percentage say yes. What that means is you can create forums and a lot of social media interaction. I was talking to them about doing the same thing for finance. Finance companies would send out a similar e-mail to their customers to let Reevoo gather information about what their customers thought of their products, whether they worked for them, and whether they would take them out again.
Then we could include that information with our functionality so that if somebody was unsure about HP, he or she would be able to ask someone else who had already used hire purchase or had used that company, or to ask how PCP works, or to find out “what happens when I hand the car back?” But, rather than getting the information from a spotty salesperson, the answer would come from somebody who had experience of that product. It would add confidence to people using dealers’ websites looking for finance options.
Do car finance professionals understand this power of peer reviews? Are they prepared to have customer reviews?
Not that I know of. That’s the problem. If I went to one of our lenders who we provide point of sale systems to and asked if they were prepared to e-mail all of their customers as they take out loans, I fear they would not release that information.
I believe they would have a reticence to have that information out there and would be afraid of negative feedback, one of the traditional barriers to an active social media presence.
I asked at Reevoo if their data was edited. They said the only thing that’s edited is defamatory or libellous content. Everything else stays on.
Kia is a young, modern brand. Our problem is finding a finance company that would buy into that. Something like that could add real weight to the offer — ask somebody else that has PCP what they think of it. That would be a great to build confidence. I am sure it will happen eventually.
Gareth Jones, head of product strategy at talent and HR consultancy The Chemistry
What can social media do for a finance company?
Finance companies should look to social media as an opportunity to talk about financial challenges, what keeps their customers awake at night, how to help them; not anything to do with product.
What finance companies should do is to search internet forums for stories of what people are doing with finance and engage with the audience, offer advice or help or direct them to places that might support them. That is the way the channel should be exploited. People will think: “They helped me out”.
Have marketing teams misunderstood social media?
There is huge potential, but I don’t think companies have got it right yet – marketers have jumped on it as a channel. In 10 years’ time marketing will look back embarrassed. It is an access point but social media is a different dimension.
It used to be about getting the customer to come to you, now it’s about going to the customer. That is fundamentally different. You have to behave completely differently. Companies are just spraying messages into my social space in the hope of driving the customer back to the company website. That doesn’t work.
Companies are looking at social media, thinking, ‘let’s just wrap it into our marketing mix,’ and that is getting it wrong.
So what can brands, such as lenders and manufacturers, do?
Social media creates trust between individuals. If you can get into the conversation and add value, you create trust.
A corporate Twitter account is a predictable first response to the medium, but that will change. We respond to each other as individuals. We respond to transparency and there will be a trend for individuals interacting without the company badge. That said, there are great customer service teams using the Twittersphere to jump on problems. They are doing it behind a corporate brand, but they are making it clear through their dialogue there is an individual behind it.People respond to transparency and authenticity.
Software like Attentio is now able to pool and calibrate social media opinions, what application could that have?
What you are talking about there is drawing sentiment from all those different sources – big data. The beauty is it is unstructured data. We’ve had big, structured data for a long time but unstructured data is new. We’ve not really had the opportunity to monitor conversation and draw sentiment from it. We are only just scratching the surface. It is incredibly powerful and incredibly relevant. Derwent Capital Markets is now hedging its funds based on Twitter sentiment. It is unmanaged, unfettered conversation and opinion. It is a bit like the world’s biggest focus group that’s not coerced or led in any way.
richard.brown@timetric.com
grant.collinson@leasinglife.com
