A captive customer base isn’t developed overnight. It is created and nurtured through constant effort, hard-work and innovation. More often than not, creating awareness in the car finance industry depends on simple steps, taken over a long period of time. To get more insight on the same, we decided to approach Mr. Patrik Riese – Managing Director and CEO of Volkswagen Finance Pvt. Ltd. (Volkswagen Financial Services) to give us first-hand information on how to captivate the finance market, and how Volkswagen Financial Services develops a strong foothold in the finance industry.
Mr. Riese initiated the conversation by saying that, “Even though we are a company of German origin, in India we are an Indian company.” He also stated that to build a strong base in India, Volkswagen Financial Services not only has to cater to the public, but to private entities as well, and that can only be possible by following these steps:
1. Maintaining Relationships
All businesses are based on consort of relationships. Same is true for the car finance industry. Companies need to build a strong relationship with their brand colleagues and with the dealer network. This is especially crucial in the case of car finance companies, because their success depends on the dealer network, since the sale of product happens entirely through dealers. In the case of Volkswagen Financial Services, which is a captive finance company, the products aren’t sold in their own outlets; instead they are promoted through the Volkswagen group dealers. Hence, strengthening relationships becomes the key.
2. Ease of business
Finance as a commodity can be tricky to sell. Banks and other competitors in the market are always offering finance at a lower rate. Which is where ease of business comes in, since a smooth finance and administration process with a finance company offers more benefits to the customer. The same system also works with the dealers, who classify as consumers in their own way. But a smooth finance transaction requires state of the art processes and systems in place, as a lot depends on administering the payout, administering finances, invoice, etc. So systems and processes that improve customer service to end consumers, and provide the ease of business are vital.
3. Play to your strengths
The final key is playing to your strengths. If a company’s strength is their product portfolio, then that should be their point of focus. As a captive finance company, Volkswagen Financial Services provides a ‘One stop solution’ with insurance, extended warranty, flexible payment terms, etc. It also offers wholesale products to the Volkswagen dealers. With the broadest product portfolio available in the market, they use it to their advantage. But sometimes having a strong portfolio just won’t do. The innovations need to keep coming, and the smartest way to innovate is to bundle up products, and give more value to the customer. A customer should be able to walk in to a dealership, get the vehicle of choice, get financing, insurance, warranty and all value added services at one place, in one go. And it should be as seamless as possible. That’s how you add value to the customer and provide good customer experience.
Granted it might be difficult to cater to each prospective customer, but as long as the basics are set in place, it can be done, effectively.