Bob Batty from technology provider ASI talks to Brian Cantwell about a new platform that uses new car-sale incentive data from dealer invoices to improve accuracy in margins.
ASI has been working on a platform that takes information from dealer transactional invoices to manufacturers and analyses the impact of incentives, including motor finance.
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The platform can give better information on the use of motor finance for manufacturers and dealers regarding the remuneration balance between car sales and finance.
In this Q&A, we find out why what ASI is doing is new to the UK market, and why it could help the use of motor finance by dealers.
Motor Finance: What is the essence of the product ASI is working on?
Bob Batty: It’s about capturing data from dealers about which cars they are selling and how, and using that to produce intelligence on what incentives for dealers are working best.
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By GlobalDataWe collect around 200,000 new retail vehicle transactions per annum – each transaction having around 30 elements of data – and around 1 million items of factory-paid options data.
The data relating to market incentives sits on a pan-European – UK, Germany, France, Spain and Italy – platform, fed and maintained by each county using brand campaign data, web scraping and mystery shopping.
The data for transactional pricing is UK only, and is fed directly and automatically from dealer management systems, which we believe is new to the UK.
MF: How does it work and what is its key selling point?
BB: The product extracts data from dealer management systems. The linking of quantified brand incentive activity, transactional pricing, and customer-paid options, finance take rates, deposits, balances and leakage is new and unique to the UK market.
The ASI platform offers transparency for the customer journey, from list price to promotional price to transactional price via option take rates, finance take rates, customer deposits and finance house leakage.
The key clients are market-research companies, as well as the brands and some large dealer groups.
MF: What can those clients do with this information?
BB: Market research companies can use it to either develop standalone products, or embed into their existing products. Those companies tend to be interested in taking a licence to use all of the data; other users tend to require more bespoke tools.
Brands can monitor their campaign spend by country, by brand or by model line against every other competitor in the market. Brands can then see their effectiveness with regard to subvented finance versus deposit contribution against after-sales incentives. It also assists in terms of defining standard specifications against optional specifications, so that they can see which customers preferred.
Finance companies can use it the same way as brands, but can also see their respective finance penetration, amount of customer deposit, finance balance and captive leakage rates. The ASI platform will also provide data-driven decision making to demonstrate the case for brand finance spend over other types of spend, which we believe is new to the UK.
Larger dealer groups have started to use option-take rates when ordering stock vehicles and demonstrators. If a model has a 90% take rate on a particular customer-paid option, then stock vehicles should have this option.
Dealers can also use price-point monitoring of transactional prices to ensure that centrally priced offers are competitive.
As it is a sensitive issue, dealers can use it with their brands to provide evidence if a model is under-supported compared to the rest of the market, but tend to keep quiet if it is more generously supported! So our product can help general sales managers’ market knowledge of competitors’ offers over their own.
Where brands want to know the transactional prices of competitors in terms of volume, speed and accuracy, this has now been superseded by a huge volume of timely, actual data, so this would be useful for mystery shopping companies.
MF: Is your platform a disruptor or a facilitator?
BB: This is a very interesting question. It depends on who uses it!
Under customer use it becomes a disruptor brand, but for finance companies and dealer groups more of a facilitator – but a new facilitator.
MF: Will it be challenged by possible regulatory approaches to remuneration in motor finance?
BB: We have legal opinion from all our global market research clients that there are no regulatory issues, as they use it extensively.
