Innovators shift FandI retailing to the Web

Innovators shift FandI retailing to the Web

- in Automotive

Drive Motors’ Aaron Krane: “We give innovation to the dealerships.”

Innovation is in Aaron Krane’s blood.

Krane, who founded digital car-buying platform Drive Motors for dealership websites, has deep roots in the industry.

His grandfather was a physicist at Ford Motor Co. from 1964 to 1999, where he was stationed in the automaker’s science laboratory. Krane said his grandfather worked on battery technologies.

Now Krane is continuing on that path of automotive innovation. Krane’s Drive Motors is part of a growing contingent of upstart companies reshaping the industry by taking the retail experience to the Web for consumers who’ve grown accustomed to e-commerce.

This drive to create an intuitive, Amazon-like experience for car shoppers has led to a digitized F&I process in which consumers can research product offerings on their own time — a far cry from the in-store experience in which buyers may feel pressured to make a decision.

Drive Motors presents F&I options via menus on dealership sites through its online checkout platform. Fellow digital retail platform Roadster offers similar capabilities with its Express Storefront tool.

In addition, F&I app and Web platform AutoGravity enables consumers to shop around for vehicle financing and get a sense of what their monthly payments will be. Finance arms such as Hyundai Capital America see value in the app, which has been downloaded more than 700,000 times since being launched during the summer of 2016. Hyundai began making financing available on the app in September to California consumers looking for a Genesis, Hyundai or Kia model.

Should these companies be feared as dangerous disrupters in the F&I world?

Krane said F&I managers shouldn’t fret. Just look at the profit potential.

Some Drive Motors dealership clients, he says, have reported an increase in F&I profits of up to $700 per vehicle on average thanks to the online presentation of these products.

Krane said the disruption will occur in the digital ecosystem.

“We are a disrupter to third-party websites such as TrueCar or Autotrader because we give innovation to the dealerships. We allow them to get the trust back that third-party sites have captured and capitalized for themselves,” Krane told Automotive News. “If the F&I store happens to be a [Drive Motors] customer, they will love us because they will generate profitable orders.”


Generating profits through accessory add-ons is an opening that digital innovators are reacting to.

Roadster began rolling out accessories menus last summer. Its Honda and Acura dealership clients were the first to get them, but Roadster plans to make the menus available for dealerships selling other brands that use the company’s Express Storefront platform.

The tool allows shoppers to see how the vehicle price is affected when items such as spoilers, LED fog lights or moonroof visors are added.

Roadster introduced the menus after getting questions from its Honda and Acura clients about adding factory accessories to the shopping process, said CEO Andy Moss.

“The goal really is to make it so that online, when the consumer is looking at their vehicle and playing with the numbers, they can also see what happens when they add the protection package or trailer hitch or other items — both during the exploration and checkout phase,” Moss told Automotive News last summer. Moss worked in fashion e-commerce before founding Roadster.

Mobile F&I

AutoGravity is disrupting the traditional F&I experience by enabling consumers to get up to four financing offers on a vehicle on their phones before coming to a dealership, but the app should be viewed as an empowerment tool for dealers and lenders, says Serge Vartanov, AutoGravity’s chief marketing officer.

People can shop for a car, select a nearby dealership that has a vehicle, choose from several finance or lease offers and get preapproved. The dealership receives a fee on the financing, and customers complete the transaction at the dealership, where they can buy F&I products and take delivery of the vehicle.

Vartanov said lenders can stay ahead of the disruption by partnering with AutoGravity and embracing innovation like their youngest potential clients have. Vartanov said two-thirds of AutoGravity users are between ages 20 and 35.

The technology continues to gain momentum. Vartanov said in November that even though AutoGravity had spent less than a third of its 2017 marketing budget, it had drawn far more users than expected last year. The company launched its first national TV campaign last summer, but Vartanov said word-of-mouth has been key.

AutoGravity has partnered with more than 20 auto lenders, including Mercedes-Benz Financial Services, First Investors Financial Services and Westlake Financial Services. VW Credit Inc. decided to invest $30 million in the company.

The Fletcher Jones Automotive Group has teamed with AutoGravity on an app called FJ Drive to bring a modern shopping experience to consumers. AutoGravity says the app gives users access to the largest selection of Mercedes-Benz inventory in the nation.

“Dealers are also hungry for innovation. Dealerships and dealer groups see the world is changing. Car buyers are looking to control the process from their smartphone,” Vartanov told Automotive News. “Every day, dealerships see car shoppers on their lots and in showrooms and, instead of talking to a salesperson, they’re on their phone. With AutoGravity, the dealer gets to be on that phone.”

Hannah Lutz contributed to this report.

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