From the April issue of UCD
Seeing the dealership’s number pop up on caller ID, can make many buy-here, pay-here customers’ hearts skip a beat, as the call is usually seeking a behind payment.
But for Charles Pompey’s customers at Car-Lotta Credit and Car Sales in Kingston, Pennsylvania, the calls are often to just check in and touch base. Those courtesy calls to customers who are current on their payments have kept the dealership engaged with those borrowers and helped it grow.
“Year-over-year, sales are up, charge-offs are down, and we’ve had portfolio growth,” Pompey said.
Pompey and general manager Brian Malet require their two collectors to call all their current 1,100 customers each quarter. The calls are to see how the customer is doing and thank them for their business.
“About 70 percent of customers are on autopay. We don’t have regular contact with them,” Pompey said. “Most of the time, when our collectors are contacting them, it’s a negative contact. This is taking a couple of minutes and making a pleasant call. It’s a good way to remind them it’s not always bad to talk with us.”
It’s helped make collections more face-forward with the customers.
“A lot of people get really held up on sales. My point of view is we can have a bad sales month here and there and it’s not the end of the world,” Pompey said. “A bad collections month, it’s a lot harder to come back from. I feel like at most dealerships, the salesperson is the face of the dealership. I’m trying to reverse that and make collections and customer service the voice of the dealership.”
It’s a good way for collectors to also update information.
“You get to talk to the customer but a huge bonus is it is a great information grabber,” Malet said. “In three to four months, things change. We put all that new information in.”
The idea for the quarterly calls courtesy came out of a 20 Group meeting Pompey and Malet attended. At the time, their rollovers were lagging and their payoffs were high.
“We were trying to figure out a way to get better information and retain customers,” Pompey said. “We sat down and this is what we came up with. It’s proven even more fruitful.”
Initially it was hard to get their collectors on board with making the calls. But after they got used to it, they welcomed it.
Malet jumps in occasionally to assist with the courtesy calls.
The calls and the feedback from customers led to the dealership making changes. The dealership moved from a three-month to a one-year warranty.
Pompey and Malet know the strategy is not for every dealership, though they have seen benefits from what they call “preventive care.”
“We’ve heard some pushback when we’ve brought it up at 20 Groups like, ‘Aren’t you opening a can of worms calling a customer when there’s nothing wrong?’” Pompey said. “That’s a possibility. It’s like going to a doctor. It’s preemptive to make sure you continue to feel good. If you find something, it’s better to find it than to never have found it and it gets worse.”
For dealers who do start the calls, Pompey and Malet suggest giving it time for the program to take off.
“You need to commit to it for a minimum of a year,” Pompey said. “There needs to be an attitude change from collectors and customers being open to taking the call and thinking that you’re not calling because you want something.”
In the end, the program has helped their collectors become better listeners and more empathic, paying off with the better collections.
“With any good collector, they know they have to listen,” Malet said. “That’s the biggest point of all it. You contact a customer and it’s not just one of those calls where you’re just getting on the phone and looking to get off the phone. You listen, and when you listen, they spill the beans about a lot of things, whether they are having an issue with their car or a payment.”
