Automobile dealers are displaying more cars on their lots as inventory starts to rise again. Despite this good news for dealers, consumer demand has waned as a result of persistently high inflation, rising interest rates, and reenacting student loan obligations, among other financial challenges.

In addition, the United Auto Workers (UAW) has resolved some of the labor unrest that started in September much is still pending, as well as the future effects on plants nationwide. In the coming months, the impact of it on supply levels may affect consumers.

Now is the time for smart auto credit marketers to out-market the competition and boost prescreen campaign effectiveness in four easy steps:

1. Prime the Pump with Digital

As a precursor to your prescreen campaign, auto loan marketers should get their message out to a targeted digital audience of likely car buyers. Plus, digital is a cost-effective way to expand your reach. Consumers spend a ton of time online, especially car shoppers. Whether they’re researching a car purchase or going about their daily lives, consumers spend nearly seven hours¹ each day perusing social media and websites. The key to engaging consumers online is to target an audience that’s likely to open a car loan or lease. Once they’ve seen your message in digital channels, they’ll be more receptive to your firm offer of credit when they receive it in traditional channels. Creating awareness in digital channels will set up your email and direct mail prescreen campaigns for success.

2. Segment Your Audience First

In today’s evolving market, consumer financial capacity has changed; certain segments have become riskier. Consumers who could afford a new car in the past may now have fewer resources, making them more likely to pay late or default on their loans. To mitigate risk, marketers should segment a prospect list for desired financial capacity attributes first – before applying a prescreen process. For example, start with a list of consumers who likely have the ability to pay their auto loans. This step allows you to fine-tune your targeting. It minimizes the likelihood of offering credit to consumers who have a strong credit history, but now may not have the financial resources to consistently make car payments going forward. Plus, you’ll reduce cost by avoiding more expensive regulated credit scores for this population.

3. Extend Your Firm Offer of Credit through Email and Display

Now that you’ve created awareness and have a highly targeted prescreen list, it’s time to extend your firm offer of credit. Email and digital channels should be part of your marketing mix because they’re cost effective and consumers can respond to your offers more quickly. It’s imperative to choose partners who can help you maintain compliance. That means delivering firm offers of credit directly to consumers’ inboxes. Or digitally onboarding your prescreen list so you can serve your offer (after identity confirmation) in digital ads through a variety of channels like display, mobile and social. If your prospects don’t respond to your offer digitally, you will have raised awareness so they'll be more likely to respond to your direct mail campaign.

4. Drop Direct Mail Last

Direct mail performs best when it’s included in a multi-channel approach to targeting, nurturing and converting prospects. Due to the expense, it should be dropped last – after you’ve created awareness in online channels. With thought and planning, multi-channel prescreen campaigns can help you out-market the competition. Be sure to get the most out of your investment by segmenting your prospects first, and getting your message and offers out through email and digital channels prior to dropping direct mail. Most importantly, choose a partner that makes it easy for you to achieve your prescreen campaign goals.

To learn about Equifax's automotive solutions, visit our website.

1- The Next Web, January 30, 2019