From left: Aleks Bogoeski VP strategic alliances for CU Direct, Dan Gill, chief product officer, Carvana; Rudi Thun, COO of Roadster; Craig Nehamen, co-founder and chief operating officer, Fair.
Online auto-buying platforms are beginning to work more closely with credit unions.
“We are just starting dialog with credit unions,” said Craig Nehamen, co-founder and chief operating officer of Fair, a used-car subscription provider founded in 2016. “We think there is a synergy between us and credit unions. If a member does not qualify for a loan at your credit union, they might have to wait six years to try to qualify again. With us there is no term. They can rent a car from us, and maybe try again with the credit union in a few months after they build up their credit.”
Nehman spoke on a panel moderated by Aleks Bogoeski VP strategic alliances for CU Direct, and was joined by executives from Carvana and Roadster.
Dan Gill, chief product officer at Carvana, said his company works with third parties on financing, including many credit unions. “At the beginning no one would look at us, so we had to do our own financing. We have found our customers like self-service and transparency.”
Nehman argued most potential car buyers are researching a number that is not relevant – the price. “Most people care about their payment,” he said. “A holistic number that is realistic is what is empowering to the customer. Digital retail is not about digitizing what we do in retail. Digital retail is a whole new process that does not require forms.”
The panelists agreed the way Americans search for and buy vehicles is shifting. Nehamen said millennials and Gen Z accept transacting on their phones, to which Rudi Thun, founder and COO of Roadster, said, “It is not just millennials, even older folks are used to ordering Starbucks or Chipotle online and picking up at the store. But with younger people you had better be texting them, not calling.”
Similar to members of the dealer panel earlier in the day
, Carvana’s Gill said it would help the company gain traction if credit unions would tell it when their members are ready to turn over used cars.
“Yes, please, bring us cars,” he said. “We started by buying vehicles at auction. We now market to consumers that we will come pick up their used car. We are diversifying our supply where we can. Our attraction to credit unions has been the philosophical alignment of the mutual obsession with customer service. We look forward to connecting with any and all of you,” he told the audience.
A common theme that connects the three companies is their focus on the customer journey, noted moderator Bogoeski, who read the executives a definition of digital retailing. He defined it as a connected experience, with the customer in control and having the ability to start and stop, and asked them if they agreed or disagreed.
“I agree with most of that, but pieces are missing,” Thun assessed. “For me, what is important is digitizing every step of the process, which forces you to be transparent. Dealerships struggle with that.”
While the auto-buying process is going increasingly digital, all three agreed the digital element of automobile savings is in its early stages as consumers gradually come around to the idea of buying or renting cars online or on their phones.