Good Special Finance Managers Are Marketing Specialists First

Published by Jim Wagner April 14th, 2007 in strategy.

I’ve always believed that the most successful special finance managers are marketing specialists first. They look to find channels of business in every area possible. In addition to the traditional areas of marketing, like print and radio advertising and even internet leads, they’re constantly looking for new ways to drive more customers into their departments.

Here are two innovative ways to add incremental business to your department. If you execute consistently on them and have average traffic, these two tips can earn your department another $450,000 a year. That’s worth five minutes of your time, right? Read on.

Market to Your Customer’s References

When you’re looking at an approval from one of your subprime lenders, you probably love it when proof of income, residence and references are waived. I can understand your excitement over the first two items because they’re a pain to collect. But, if I were you, I’d be collecting ten references on each customer, regardless of whether or not it’s a requirement of your bank. I’d also be having your salespeople collect them up front, before you start trying to get them approved. That way you have them for approved customers and your turndowned customers. You’re going to talk to five times more people that you don’t approve, right?

References are great leads. They probably share the same demographic as the customer who gave them to you. Some of them are family members. Others are friends. If you treat all customers with respect and fairness, they’re going to spread the word to the people they interact with, the same people they gave you as references.

Every day, you should be sending out letters to each of the references you’ve collected from. Your call center or business development center could also give them a call. If you use a CRM tool be sure to load these leads into the system under the specific category of references so you can track your close rate.

Whichever approach you plan to take, your efforts to market to and close the references you collect can make you real money. If you talk to 100 people a month, and you collect ten references on each, that’s 1,000 good leads to work on. Even if you only close 1%, you’re going to see another 10 units a month. At 2,500 a copy, by thinking smart, you’ve made another $25,000 a month and $300,000 a year. Even if you don’t talk to that many people, I promise you’ll find substantial success and incremental profit by using this method.

Follow Up With Your Turned Down Customers

Every bad credit customer you finance today probably could not be financed at one point in the recent past. Not too long ago they might have had open bankruptcies, recent reposessions, slow credit, an open judgement, or even mistakes on their credit file. Most special finance managers shake the hand of the turned down customer, tell them they’re sorry they couldn’t help them out, and move on to the next. Into the dead deal file goes your customer to be forgotten forever.

If you’re doing that, stop today. For every customer you get financed, there are at least five more that you did not. Why not take ten minutes or so to consult with your customer and help them put together a plan that will help them get back on track. Here’s an article I wrote on repairing bad credit. Feel free to print off the article. Or, use your own experience to talk to them about credit repair. Print off a checklist of credit repair methods with your contact info on it. If you do that, you’ll earn their loyalty.

When they’re qualified to buy a car in a year or so, you’ll be the first person they call. Do this with enough customers, and you’ll be moving your department to the next level. Plus you’ll be building your reputation.

If you’re a store delivering 25 special finance customers a month, you’re probably talking to about 100 customers who you could not finance. That’s 1200 a year. Even if you eventually close only 5% of those customers, you’re talking a lifetime value of over $150,000 per year on your turned down customers!

There. I’ve shown you how your department can make another $450,000 a year in profit. I don’t know your payplan, but based on even the weakest you’re going to increase your standard of living.

If you’re a special finance manager who wants more success, remember: you’re a marketing manager first.