Bad Credit? Time to Roll out the Red Carpet

The car business is a people business. Because of that, dealerships see customers from a variety of backgrounds, income levels and credit histories. And, for a salesperson or manager, there’s nothing more disheartening than to spend a lot of time with a customer just to discover that they are credit challenged. Despite that, many dealerships will do their best to land the customer on the right vehicle, structure a deal for a subprime lender of theirs or, at the very least, try to see if the customer has a co-signer.


The problem is that in some dealerships, the minute it’s discovered that a customer has poor credit, they are all of a sudden treated like a second-class citizen. However, the fact is that in this customer lies not just a problem, but also an opportunity.


Salespeople – whether they are Internet or floor sales – are taught to “just get them in.” If you have a BDC, that’s also their job. Many dealerships broadcast advertising messages dangling hope to people with challenged credit and welcome them in. Why? Because oftentimes customers with challenged credit will let you slap them into any car you have and tend to be more agreeable to terms.


But, while this is absolutely true, it is sad to see what actually happens far too many times in this process. When presented with a customer with challenged credit, all of a sudden the customer experience changes from being welcomed with open arms and “Of course we can help you!” to a rather demeaning inquisition. Closers are taught to “beat up” these customers. To point out and question every derogatory item on the customer’s credit reports. Many times, if it’s determined that there is a possibility that the customer could get financed, managers direct the salespeople to show a specific car. Typically, one that the dealership wants to get rid of, regardless of the needs of the customer.


And this is where the problem lies.


Credit challenged customers come from all walks of life. Some have poor credit because of circumstances that were beyond their control. Some earned that poor credit. Regardless of what the case may be, these customers are the easiest customers to convert into brand advocates and oftentimes the most profitable. Typically, these credit challenged customers are highly appreciative. They honestly feel as if you helped them – and you did. These customers will tell everyone they know that you helped them. The next thing you know all of their friends and relatives are calling you asking for your help. They will climb mountain peaks and scream out praises about your dealership. And, with social media and the power of online reviews, this can have a huge impact on your dealership. In fact, studies show that as many as 70% of car buyers are influenced by dealership reviews.


Remember – EVERY customer experience is important. As consumers now learn most things about your dealership online before stepping a foot on your lot, these online reviews again come into play – make sure every customer is happy enough to sing your praises! Your reputation and reviews can be hugely impacted by pre-judging customers and treating them poorly.


 Not all customers with bad credit stay customers with bad credit. Many turn their credit around and they very well may have begun that turnaround with you. These customers remember that when they were down, you helped them. In return, they will remain loyal to you for life.


So, if you’re going to welcome and invite credit challenged people to your dealership, make sure they get an incredible buying experience -- just as you would give someone with perfect credit. That perfect credit customer knows that they can buy a car anyplace, anytime. Customers with bad credit are simply looking for someone who can help them.


Be that someone and you’ll discover that simply treating all customers with a great customer experience, regardless of credit score, can lead you to increased customer retention, referrals and loyalty. After all, today it is all about the customer experience – one that can quickly get broadcast all over social media – so make sure it’s a good one, each and every time!


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