Captive Auto Lenders Behind on Digital
The study found that many lenders, especially noncaptives, have much room for improvement to meet today’s consumer expectations.
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Mercedes’ auto lending arm is setting the pace on consumer digital experiences in a market that increasingly values high-quality online presences.
A third annual J.D. Power study on digital auto finance channels shows how much consistent experiences on auto lender websites and applications and smooth transitions between those and offline communications increase customer engagement, satisfaction and loyalty.
“Channel consistency is still the name of the game in any digital financial services user experience,” said Senior Director of Digital Solutions Jon Sundberg.
A good digital experience yields positive customer results, according to the study. The vast majority of consumers who used a lender with a high digital satisfaction score said they’d definitely use its website or mobile app again.
Consumers’ increasing use of artificial intelligence tools to shop for auto loans is raising the pressure to polish digital channels. But the study found that despite progress, many lenders have much room for improvement to meet today’s consumer expectations, especially noncaptives.
Mercedes-Benz Financial Services nevertheless outscored all captive and noncaptive lenders on digital experience in the study with a score of 746. In fact, German luxury automakers swept the captive segment of the industry, Audi in second place at 740, and BMW third at 727.
Among noncaptives, Bank of America led with a score of 741, followed by Chase Auto at 730, and Wells Fargo at 715.
Noncaptive lenders have improved their mobile apps for a two-point score increase to 704, 20 points above captives’ 684.
“A great digital experience is becoming a crucial component of customer retention,” said J.D. Power Senior Director of Automotive Finance Intelligence Patrick Roosenberg. “As more vehicle shoppers start using artificial intelligence and other digital tools to shop for their next auto loan, it will be critical for lenders to have a meaningful digital connection with existing loan customers so they stay top-of-mind throughout that process.”
He said banks are overall outscoring captive lenders digitally because they developed sophisticated digital channels for other parts of their business. With that and some captives’ digital groundwork, “the playbook of best practices is starting to become much clearer and there are huge opportunities for improvement in this space.”
J.D. Power surveyed nearly 6,500 auto finance consumers who used a lender’s website or mobile app.