With the powersports industry showing steady recovery post-recession, many lenders are increasing investments in digital capabilities to boost loan and lease volumes.
MotoLease LLC, for example, utilizes all electronic files, which makes the application approval process quicker and easier for lessees, Maurice Salter, chief executive, told Powersports Finance. “We can approve in a matter of seconds, and we can close a complete deal within 20 minutes if they have all the [necessary documents] together,” Salter said.
That’s important because most consumers do not have all of their documents together, which means the application process could take days. MotoLease’s digital platform only takes hours, which largely contributes to the company’s strong growth of its lease originations.
Los Angeles-based MotoLease currently services 1,000 authorized dealers, and adds five new dealers on average to its network each week. The company funded 7,000 powersport vehicle leases in 2015 and is aiming to fund 10,000 leases this year.
MotoLease is also set to release two apps to service its customers and increase its online footprint, Emre Ucer, managing partner at MotoLease, told Powersports Finance. The first app, My MotoLease — slated for release by the end of February — will provide lessees the ability to view their payment history, schedule new payments, get payoff quotes, and set reminders, all from their mobile device, Ucer said. The second app, MotoLease Now — set for release in March—will service new lessees by allowing users to apply for a lease directly from their smartphone, with the ability to receive instant approval.
HorsePower Financial Services, a Lebanon, Ohio-based powersports finance company, is also taking advantage of technology innovations to increase its digital footprint. The company upgraded its website in January to include modernized graphics and a new dealer portal, Vic Perz, HorsePower’s director of marketing, told Powersports Finance. The portal will allow dealers access to financial education literature on LifeStyle Lease, HorsePower’s zero-money down finance option, with terms between 12 and 48 months, on a preowned Harley-Davidson motorcycle, Perz said.
The company is also in the process of adding off-lease motorcycle inventory into the portal. “We will begin uploading off-lease inventory in the next 30 days, and from there it will be an ongoing process,” Perz said.
HorsePower Financial Services offers leases to consumers in the prime market and currently works with 40 dealers, Ray Phipps, chief executive and founder, told Powersports Finance. The company reported a 200% increase in year-over-year lease originations for 2015, Phipps added.
In addition to lenders, industry leaders are also striving for a more paperless platform to help service consumers and bring in investments. “For investments — like everybody — you have to go digital and bring in more technology to create efficiency,” Steven Wulfekuhle, sales director for Troy, Mich.-based Oracle Financial Services, an IT solutions provider with 12,000 employees, told Powersports Finance. “Everything is moving to digital — the internet, mobility of devices, automating paper flow.”
“Powersports is probably trending behind because there are so many small dealers and they have a hard time investing in technology. It’s a matter in which lenders can provide them technology to help them modernize their processes.”
– Steven Wulfekuhle, Sales Director, Oracle Financial Services
In comparison to auto lending, the powersports industry is trailing in technology though, due in large part to smaller dealers and less capital, Wulfekuhle said. “Powersports is probably trending behind because there are so many small dealers and they have a hard time investing in technology,” he added. “It’s a matter in which lenders can provide them technology to help them modernize their processes. There’s less capital in powersports as well. Access to capital reduces investment in technology. The demand is there, but it’s about who’s able to invest and who can’t.”
Digital activities are becoming increasingly important when it comes to qualifying the customer, Paula Tompkins, chief executive and founder at ChannelNet, told Powersports Finance. ChannelNet offers data and solutions to 350 powersport dealers and one lender, and tracked a 78% completion rate from its online credit applications where customers can receive a real-time credit approval, she added. Using website analytics, the company was also able to track that 13.3 vehicles are sold each month via the online form, Tompkins said.
ChannelNet has also determined that heavy online traffic occurs during the weekends and between the hours of 1 a.m. and 2 a.m. when dealers are not open. Providing customers with the 24/7 convenience of online services is an essential aspect to making a sale, Tompkins added.
Another important digital aspect is account servicing, which includes “the benefit of being able to set up your automated clearinghouse to be able to check and see if they [lenders] received your check,” she said.
Automating sales and integrating information tools is an area of innovation the powersports industry is working to improve, said Jim Woodruff, chief operating officer of National Powersport Auctions.
NPA for example, partnered with CyclePro, a software platform dedicated to the powersports industry, in an effort to expand the use of new technology in the industry.
“I think there are things inside of a dealership that there is no technology for today, and I think that’s an area that’s going to grow.”
– Jim Woodruff, Chief Operating Officer, National Powersport Auctions
CyclePro is a sales automation tool that offers several features, including equity mining, which allows dealers to see consumers’ historical transactions, including past loan rates, existing loan balances, and the estimated value of their current vehicle, according to the company’s website. This process can help dealers filter through customers, to find out which are likely to purchase a new powersports vehicle.
Despite the efforts of NPA and the industry in general, powersports is actually “several years” behind the auto industry when it comes to technology, Woodruff said. “In many ways, that’s a good thing, because it encourages the experience of motorcycling versus just raw business efficiency,” he added.
This story originally appeared in the inaugural Powersports Finance Quarterly. To get access this issue, subscribe here.Like This Article