Holman Automotive Breaks F&I Records, Boosts PVR by $200 with Prescriptive F&I Selling

Big data and predictive analytics create a personalized and effective selling process.

With 37 dealership franchises representing 18 brands from the East Coast to the Pacific Northwest, Holman Automotive is one of the largest privately owned dealership groups in the United States.

The company was founded in 1924, when Steward C. Holman signed a contract with Ford Motor Company to become the area dealer in Merchantville, NJ, financed by his partner, Charles M. Rice. The dealership was named Rice and Holman Ford, and during its early years, sold Model T, Model A and the first V-8 models.

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Steward Holman’s success with Rice and Holman Ford led to many other opportunities in conjunction with Ford Motor Company, including an area distributorship for Lincoln Mercury, remanufacturing Ford engines and transmissions, as well as expanding its retail automotive operations throughout the country. The business has grown and flourished, today managing more than 1 million vehicles in North America, the UK and Europe, and combined with its global associates, more than 2 million fleet vehicles worldwide.

The Holman family has continued to leverage other complementary business opportunities to best serve their clients, launching Steward Financial Services, a consumer finance company; offering a variety of policies through Holman Insurance Services; and acquiring the Auto Truck Group, a family-owned truck upfitting company, to better serve fleet clients. Holman has also continued to operate a parts distribution group, Holman Parts Distribution.

In order to maintain its solid position in this fast-paced industry, the company looked to improve its dealership’s F&I processes.

Gregory L. Zulli, vice president of finance and insurance at Holman Automotive, spent time researching F&I menus, as the group wanted to be digitally advanced and better service customers by conducting more of the sales transaction online.

“We wanted to engage with customers earlier in their research and the sales cycle,” Zulli said.

Their solution came in the form of Darwin Automotive’s electronic F&I menus — to much success.

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Since installing Darwin Automotive’s F&I menu almost a year ago, Holman Automotive has improved product and finance reserve year-over-year and enjoyed the highest PVR in history, adding over $200 per copy. It has done this through Darwin’s “prescriptive selling,” a patented technology that uses input from consumer, vehicle, deal and third-party sources to tailor F&I product presentations to individual car buyers. The patented technology looks at the overall deal, vehicle and financial situation for each customer to determine the ideal presentation that is proven to increase sales and decrease chargebacks.

“Since we installed Darwin Automotive’s electronic F&I menu about nine months ago, we have had some of our highest F&I months and set records for five of those months year-over-year,” Zulli said. “There is a direct correlation between our numbers improving and the implementation of better technology to improve the customer experience; in conjunction with training, accountability and pay plan adjustments. It has been a multi-prong approach. It is a combination of having the best and most innovative tools and working on our people. We are getting excellent feedback from customers and shortened time for vehicle delivery. It now takes about 10% less time for many vehicles, which is a substantial time saving over the span of a day.”

The F&I process now starts with the customer completing a simple ownership survey. This information is then merged with DMS information, including purchase history when applicable, and external data to identify the F&I products most likely to resonate with each customer. All products are presented to ensure compliance, but the presentation order changes based on the individual consumer.

According to Zulli, the process works best if the ownership survey is completed as early as possible in the process, before going into F&I. The F&I manager is then better prepared, which further speeds up the process. A survey link can be emailed to the customer to fill out before visiting the dealership, and they can even review F&I options.

When the customer is at the dealership, a good point is found in the sales process to present the customer with an iPad. The system walks the customer through a quick digital interview, a fundamental needs-based analysis including what they plan to use the vehicle for, how many miles per year they will be driving and how long they plan to own the vehicle. The data goes through an algorithm that suggests which products have the highest chance of selling and produces a menu tailored for the needs of that specific customer. The survey takes less than five minutes to complete.

Zulli particularly likes the fact that all products in the Darwin menu system are validated by a third party.

“Previously, the F&I manager would talk about the cost of repairing the transmission and pull out an RO showing how expensive it could be, using that information to show value,” Zulli explained. “With the Darwin third-party validation, you click a button and it pulls up Edmunds.com and shows the customer that average cost of ownership over 60 months is $5,000. You can then show the customer that for just $2,000 rolled into the cost, they can cover this $5,000 cost of ownership. Otherwise, they are on the hook. Alternatively, for gap insurance, the Darwin tool will show the customer how the loan is depreciating at this level, so in six months your vehicle will be worth this and in 12, this, all based on third-party data. It adds credibility as this is an independent third-party telling the customer, rather than just the F&I manager.”

Zulli likens prescriptive F&I selling to today’s modern doctors and finds it particularly effective. “This type of selling is along the lines of, ‘Hey, this is what you are telling me, so this is what I think you need.’ Rather than handling objections, it is more like going to the doctor and telling him you have a sore throat and earache so, based on that information, he prescribes a precise treatment of antibiotics that will work for your situation. Also, the third-party validation is critical as people are skeptical of products and what you sell.”

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Holman Automotive kiosk
KIOSK

Looking to the future, Holman Automotive plans to install Darwin Automotive’s F&I menus in the service drive, with kiosks or iPads where customers can purchase F&I products directly, paying by credit card. The system will also offer service financing for up to 20 months and will send out automatic reminders and personalized email or texts to customers, offering different products tailored to the customer’s specific driving habits and needs.

“If we do not sell a service contract at the time of delivery, we will get several other opportunities to capture that business in the future,” Zulli explained.

Holman Automotive has been dedicated to providing outstanding service to its customers for over 87 years. Now into the third generation of family leadership, the Holman Automotive Group is poised to continue its success for decades to come.

For more information, or to schedule a product demonstration, call 1-732-781-9010 or visit darwinautomotive.com.