J.D. Power research highlights a need for lenders to embrace self-service engagement to increase profitability.
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Auto lenders must enhance customer experiences and cut administrative costs amid shrinking margins and strained profitability, J.D. Power said in its inaugural U.S. Automotive Finance Digital Experience Study.
Retirement plan administrators, property-and-casualty insurers, and wealth-management firms have successfully transitioned to digital solutions, J.D Power said, but auto lenders are lagging.
In fact, just 22% of customers expressed high satisfaction with their lender's digital experience, according to the study. Overall, it found the average customer satisfaction score for auto finance websites is 643 on a 1,000-point scale, and the average score for mobile apps is 659.
The numbers are lower than the average overall satisfaction score of 656 for retirement plan websites and 728 for retirement plan applications; 719 for P&C insurance websites and 716 for P&C insurance mobile apps; and 704 for wealth-management websites and 738 for wealth-management apps.
“Strong digital engagement sustains self-service engagement, which is exactly what auto lenders need to do to increase profitability by reducing the cost to serve and retain customers in this challenging economic environment,” said Patrick Roosenberg, senior director of automotive finance intelligence at J.D. Power. “Among customers who give their lenders top ratings for digital enablement, 95% say they ‘definitely will’ return to the lender’s website or app to manage their account. That percentage falls to just 60% when customers give their lenders low marks for digital enablement.”
The study assessed customer satisfaction with auto finance websites and apps based on four criteria: information/content, ease of use, customer service, and overall experience. It analyzed data from 3,876 automotive finance customers who used their lender's desktop website or mobile app from September to October.
Though individual scores weren't provided, the automotive finance companies included are:
- Ally Financial
- Bank of America
- Capital One Auto Finance
- Chase Automotive Finance
- Ford Credit
- GM Financial
- Honda Financial Services
- Hyundai Motor Finance
- Kia Finance America
- NMAC
- Santander Auto Finance
- Toyota Financial Services
- Wells Fargo Auto
For more detail, see study results in their entirety here.
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