Digital car sales: 5 best practices for a booming business
How pairing up with an online used car retailer has helped Digital Federal Credit Union serve members during social distancing, play to partner popularity, and update an old sales model.
Credit unions aren’t alone in facing digital disruption, new competition, and unexpected surprises in the marketplace. Traditional auto dealers, for example, felt the pinch as U.S. consumers opted to avoid in-person lots during the height of the pandemic. The move added to the already growing momentum of virtual shopping for one of the most important items many people possess — their cars and trucks.
Rather than lose business to a new way of buying, Digital Federal Credit Union ($9.9B, Marlborough, MA) is riding that wave and now finances more than a thousand loans a year directly for members through Carvana.
Although that’s a small piece of the pie for a credit union with an auto loan portfolio of $2.5 billion — more than $1.9 billion of it in used vehicles — it’s a growing trend DCU is embracing.
Carvana gained attention with its vending machine approach to used car buying, but its direct-to-consumer sales have soared and it has become a serious rival with CarMax as the largest seller — and buyer — of used cars in the country.
continue reading »