Nearly everything you need to know about how to maximise your finance penetration

Finance Penetration

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Vehicle finance is key for online and in-person retail

Improving finance penetration, and therefore the profitability of each unit, has stood as the main priority for most F&I teams in both small and large dealerships.

With many existing retailer websites only offering a rudimentary online experience, something we call online retail 1.0, motor finance online is an afterthought, leaving many retailers struggling to capitalise on their digital channels. 

Just over 64% of used cars, and over 90% of new cars, are bought on finance, providing a massive opportunity for retailers to maximise their profit on every vehicle sold by offering motor finance online.


As consumers move away from the showroom and start engaging with online tools like finance calculators and finance soft search, retailers lose the advantage of having skilled sales people on hand to discuss the benefits of vehicle finance, highlighting a significant flaw in the modern vehicle finance journey.

Dealerships who actively promote their motor finance products online sell more finance, but many aren’t maximising the opportunities available at the different stages of the vehicle buying journey.

Retailers need to upgrade their finance offerings and make the process as easy and as digestible as possible for all consumers, moving quickly to leverage their online presence and turn it into a more valuable profit centre. 

With an eye on how new technologies are changing, and the way consumers engage with the vehicle sales process, retailers can begin building online buying journeys that mirror the showroom experience, and bring additional efficiencies to the sales process, offering the experience consumers expect.

By transforming the online experience, retailers can encourage consumers to engage with their finance offering at the very beginning of the buying process, improving consumer visibility of finance products, and in turn improving finance penetration.

Digital adoption provides retailers with a reduced cost of entry into the world of online vehicle sales, and here are five key areas to consider when planning your digital strategies.

Download our guide on connecting the online and showroom customer

How are consumers interacting with finance?

Consumer behaviour continues to reshape the way vehicles are bought and sold.


The financial services industry has undergone rapid transformation, driven by both changing consumer expectations and the adoption of new digital technologies.

In addition, the financial services ecosystem has been accelerated by fragmentation, bringing new business models into the industry that challenge the status quo.

The COVID-19 pandemic accelerated an already clear trend of online retail, and consumers' choices for performing many finance-related activities have significantly broadened with the proliferation of new digital solutions.

The best example is in the banking sector, where digital banking is no longer an add-on service from large banks, but exists as a fully established product. Many new entrants provide a digital-only service, and most high-street banks are now closing branches in favour of a digital-first approach.

Another example where consumers are increasingly willing to engage with finance technology is with new Buy Now Pay Later (BNPL) apps like Klarna and Clearpay. These apps provide access to products and services that were otherwise out of the consumer's financial reach, and the efficiency of managing the whole process through an easy-to-use app helps consumers feel in control of the entire transaction.

How are customers interacting with finance-01

Buying digitally is now the expectation, not the differentiator. A process designed to make life easier and more straightforward, and giving consumers methods to buy online, are quickly becoming top priorities for automotive retailers.

The vehicle market is not immune to digital transformation, it’s just slow to adapt and adopt new technologies. This slow adoption is a result of the more complex characteristics found in an automotive sale.

Vehicle sales require a technology solution that can deliver more than a simple and linear path to purchase, it requires a platform capable of delivering for retailers, financiers, and consumers.

Price comparison sites have transformed the way consumers arrange insurance, picking out the best deal for their budget and their requirements. With the right technology, motor finance should be just as accessible, and iVendi has noted a shift in approach from consumers. 

Pre-pandemic, just 22% of vehicle finance applications were completed entirely online, with the vast majority conducted in showrooms. But in 2020, online applications grew to 30%, rising to 35% in 2021 on the way to iVendi’s expectation that over half of applications will soon be made digitally and directly by the consumer.

Are your finance products visible online?

Moving online shouldn’t impact a retailer’s ability to maximise the number of customers choosing to purchase finance.

The right technology can help optimise the journey, turning online channels into additional revenue streams through simple-to-use online motor finance tools that push consumers down the funnel and generate finance leads like online car finance calculators and finance soft search capability.

Are your finance products visible-01Simplicity is key, and a clear path should always be easily visible to the user. Shoppers who don’t know what to do next are not going to move further down the finance journey.

After the vehicle itself, motor finance is the most integral part of any sale, and should be introduced to consumers as early as possible in the process. This is emphatically true online, where historically, the availability and benefits of finance have been hard to demonstrate.

This kind of buying experience, where finance is an afterthought, is a missed opportunity for retailers to add additional profit per sale. Ensuring the journey is as clear and engaging as possible, is therefore vital.

90% of car buying journeys now begin online, which presents retailers the unique opportunity of introducing the customer to their finance products at a much earlier stage in the buying journey. Place finance at the heart of your digital buying journeys, and ensure the finance products you have on offer are visible to your customers online.

In order to maximise the visibility of your motor finance products, provide ways for consumers to begin completing key steps by themselves and make sure these are clearly signposted on your website. Car finance soft search will show consumers what finance products they’re eligible for, and smart comparators can provide a comparison site-style shopping experience, keeping consumers engaged and providing organic progression.

Providing the ability to personalise motor finance quotes with online car finance calculators helps highlight the affordability of vehicles in your stock, and lets consumers make informed decisions that consider budget and contract term, and gives consumers the confidence they need to complete the purchase.

By giving consumers these tools, they can progress the buying journey as slowly or as quickly as they’d like.

Explore our online finance solutions

Build a self-serve buying journey

If consumers aren’t ready to buy, then they won’t. 

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Even if they are ready, a lack of options that allow them to progress through the journey can limit their potential to move further down the sales funnel.

As consumers gain more experience shopping online, their expectations surrounding digital sales processes will also start to increase. Automotive retailing needs to reflect the wider digital world in order to gain the trust of buyers, and when it does, the benefits are there for all. 

Consumers are more willing to engage with digital tools that make their lives easier, and new self-serve technology takes this to the next level

Modern consumers are tech-savvy. Gone are the days when the average person has zero I.T. skills, and most are comfortable submitting information digitally. Retailers can meet consumers’ online retail expectations by allowing them to progress much of the buying journey themselves. And the right combination of tech can both enhance the consumer experience and provide efficiencies for retailers.

Buyers get to complete key parts of the customer journey themselves, at a point and in a way that suits them, while the retailer gains time and accelerates the sales process thanks to the deployment of advanced technology.

Research by iVendi found that peak customer browsing times are outside a showroom’s business hours, with dealership websites hitting peak traffic between 6-10pm. The right technology can cater to these buyers while the showroom isn’t even open.

Understanding the buying journey your customers take online is the first step towards a seamless buying journey. Consider where consumers drop off, and where they engage the most. Work to optimise the sections that work, and improve the areas that don’t.

Download our Digital Strategy guide

Get the formula right

Motor finance itself is a confusing landscape for buyers. Agreements are often complicated and packed with jargon that most people don’t want, and some don’t even bother to read.

Finding the right formula is difficult.  But building a process that allows customers to manage their own applications from start to finish is a sure fire way to improve engagement.

Users spend, on average, less than 15 seconds on a website, and the chances are a customer will only sign up with you once. If the experience doesn’t meet their expectations, they are unlikely to progress the journey any further with you.

Throwing many digital tools at a problem and hoping something sticks is not going to produce an engaging consumer journey that encourages buyers to progress their finance purchase.

Retailer - Enhance the customer experience - 5_Retailer - Enhance the customer experienc

As complex as the finance journey may become, it is important (and regulated) that the retailer be as transparent as possible with the consumer, and ensure they understand the complexities of the agreement they’re getting into.

Provide resources that build consumer confidence and establish your expertise, positioning your business as a valuable source of information for those who are unsure of which finance product is right for them.

Use jargon-free product explanations that clearly show the differences between each of your finance products and explain how some finance products provide an effective avenue to long-term ownership. Or for those who want something more flexible, direct them to your leasing agreements, and clearly demonstrate the benefits.

Explore our Connected Retailing Solutions

Make finance go further

Per-unit profitability is pivotal in a vehicle sale, regardless of the size of the retailer and the stock they carry.

Profitability can vary from retailer to retailer. As the rise of electric-vehicles and agency models start to penetrate the market, the question surrounding operating profitability remains a subject of debate for automotive retailers.

The profit to be made in each vehicle can vary based on factors such as the age of the vehicle, its condition, mileage, and brand. While there will always be money in the metal, the additional profitability provided by finance products can’t be overlooked.

In addition to selling finance, and the commission that comes with that, the inclusion of value-added products fuels per-unit profitability. And with the growth in online sales, introducing additional products and services earlier in your buying journey is a proven method of increasing profitability.


Too often add-on products are sold, as their name suggests, at the end of the buying journey. Online, these products are introduced at the last possible moment, making them appear as nothing more than additional costs. This makes it difficult for consumers to see their true value and robs retailers of valuable profit-making opportunities.

Including add-ons as an integral part of the journey, and as early as possible, gives consumers the chance to fully understand the benefits and advantages of opting to include the additional item. The right technology ensures that this vital revenue stream is not only maintained, but enhanced. A leading warranty provider Warrantywise reports that its most successful dealership recorded increases of up to 84% in warranty upgrades. These dealerships adopted the right technology that helped them increase their profitability through finance.

Explore our online finance solutions

Learn how the right technology can help you adapt to the changing automotive landscape

New technologies are changing the way vehicles are bought & sold. To help retailers, lenders and manufacturers create the best buying journeys to cater to all buyers, our industry experts share their specialised knowledge and insights to provide you with in-depth information on everything you need to know about digital transformation in the automotive sector.

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