FRIDAY, March 29, 2024
nationthailand

Omni-channel shopping shaping up as the ‘next big thing’ in auto finance

Omni-channel shopping shaping up as the ‘next big thing’ in auto finance

KRUNGSRI AUTO, a leader in automotive finance under the Bank of Ayudhya, has identified the omni-channel customer experience as the next big thing in the auto finance market and is encouraging the industry to offer a seamless experience to win the hearts of customers.

Although many consumers in the “Marketing 5.0” era lead an always-connected lifestyle, offline channels are still necessary, especially for |the auto buying journey, Pairote Cheunkrut, head of Krungsri Auto Group, told a press conference last week.
He shared some digital insights that says will help brands win the heart of car buyers and shape the auto finance industry in the 5.0 era.
Consumers may use online platforms to search for vehicle or loan information, reading reviews and comparing prices, Pairote began. But those consumers also visit dealerships for test drives and talk to financial advisors before submitting documents, he continued.
Thus, auto finance services must be available both online and offline, and all customer data must be synchronised across all channels, Pairote said.
“This will allow lenders to deliver a truly seamless customer experience.” 
He said consumers in the age of Marketing 5.0 are more empowered than ever because they can access a plethora of information from anywhere at any time. And sometimes make purchase decisions even before seeing the physical products. 
Thus, it is crucial that auto finance services are present in the online world, while lenders must be able to offer customers relevant advice that will empower them to make the right choices, he added.
To win over the hearts of consumers, auto finance providers need to foster meaningful relationships with the target audiences even before they consider buying a car. They must strengthen brand recognition to ensure it enjoys a top-of-mind position, he said.
He said traditional segmentation criteria can no longer tap into customers’ true identities because consumers often have more than one ambition in life.
Auto finance brands face two key questions they need to answer – where to look for data that will enable them to truly get to know their customers, and how to use the information to develop products or services that can respond to today’s multidimensional lifestyles, he added.
“We believe the auto-loan market will grow if we respond well to the [digital] insights. We have to get to know well our customers’ needs and lifestyles, so that we can design or develop a new business model to effectively meet those needs and lifestyles” Pairote stressed.
“As a market shaper, we will focus on agility and a digital approach, following the digital insights as our road map to win customers’ hearts,” he added.
The company set this year’s new-loan growth target at Bt198.6 billion or a 20 per cent gain year on year.
Of that sum, the total lending volume via online channels this year will be at least Bt1.8 billion, growing from Bt1.31 billion last year, according to Pairote.
The company also plans to introduce a variety of new digital products throughout next year to reinforce its leadership in digital marketing in the automotive finance market.
Last month it launched “Krungsri Auto PromptStart”, the first digital auto lending platform in Thailand to allow customers to check their credit appraisals via a mobile website.
The innovation has been very well-received, with over 304,000 visitors and Bt483.39 million in credit appraisals performed in the first month after its launch,” said Pairote.
According to him, the auto loan market in Thailand this year will grow beyond predictions to a total market value of Bt624 billion, gaining 12 per cent from last year.
The growth was mainly driven by outstanding new-car sales, which reached 1.02 million units for a year-on-year growth of 17 per cent.
It was the first time over the past five years that car sales topped |one million units, he added. 
However, Pairote estimated that auto sales volume growth for next year would be in the single digits, in the range of 4-5 per cent, although the second eco-car phase will be launched in mid-2019 and after the rule expires ,prohibiting first-car buyers under the first-car tax rebate project from selling their vehicles for the first five years. 
Currently, the company has 1.5 million active customers.
Like other industries, the auto loans sector has faced technological disruption that brought about significant changes in consumer behaviour and new business models. Brands across the industry were forced to transform the way they operate to increase their competitiveness.
At Krungsri Auto, they use data analytics and scientists to segment customers and design new services to fit the customers in each segment. They store all data on the cloud, protecting the system from crashes and allowing indefinite storage.
Technology helps us screen and grade customers and more precisely analyse the potential for paying back their auto loan, reducing the rate for non-performing car loans (NPL) to no more than 2 per cent, Pairote said.
Krungsri Auto’s NPL is in line with the market average at 1.6 per cent, he said.
 

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