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Financial Services

Captive Financing Increases Customer Loyalty and Business Value

Previously, I highlighted customer relationships and generating income with captive financing. This post analyzes value creation and how to get started with captive financing in your business.

Value Creation

With manufacturer-provided financing, transactions can be closed that might have been otherwise delayed while customers sought third-party funding. With superior knowledge of the equipment and its residual market value, lease terms can often be more favorable when determined by the manufacturer. Also, with continued communications with their customers, manufacturers can build awareness of product developments, thus creating demand for future acquisitions.

There is another advantage to a manufacturer’s captive financing that perhaps eclipses the direct financial benefits. Having the entire transaction handled by the manufacturer is a key enabler for a superior customer experience, which provides the opportunity to retain customers and build brand loyalty. By 2020, customer experience will surpass price and product as the key brand differentiator.

Customer experience is a major component of a comprehensive digital transformation strategy. Customer experience is the interaction between an organization and a customer over the duration of their relationship. It encompasses all points of customer/company contact, whether on mobile and website apps, social media, in person, text, phone, and across product acquisition and service, marketing, and support. Although called “customer experience,” the experience truly begins long before a customer relationship is established. A company’s brand is defined by the experience provided, and in turn, is a factor in attracting prospective customers.

Without question, the financial services arm of a manufacturer can be a key synergistic business to the overall enterprise. Seamlessly integrating financial services with the manufacturer and dealer experience – via digital transformation, and more specifically, customer experience – can help extend a company’s leadership position in the industry while exceeding customer expectations.

How to Get Started

We have partnered with some of the world’s leading companies to deliver their digital vision for an exciting new integrated customer experience. With support from our experts in financial services and our in-house agency, Perficient Digital, we are well-positioned to enable manufacturers to join the digital revolution.

Our proprietary jumpstart tool, the CX IQ, evaluates a company’s effectiveness in creating, delivering, and sustaining a compelling customer experience across 57 attributes/capabilities in seven CX dimensions:

  1. Customer insight
  2. Strategy
  3. Design processes
  4. Enabling technologies
  5. Operations
  6. Measurement
  7. Culture

The six-week engagement is an effective way to engage the management team, create alignment, and guide decisions about where and how to improve CX. As part of your CX IQ engagement, you’ll receive a CX IQ scorecard, a summary of data and metrics to explain the CX score, and an action plan with a prioritized list of defined CX projects, and a full day CX workshop event.

There are numerous reasons for the growth in manufacturer-provided financing, including enhanced customer relationships, income generation, and value creation. To learn more about these topics in-depth, outlining the benefits of each to increase customer loyalty, you can download the paper here, or submit the form below.

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David Willner

David Willner is a business-focused information technology executive in Perficient’s financial services practice. His specialty is in transformation and data strategy programs. Before Perficient, he served as a managing director at J.P. Morgan Chase, senior managing director and chief development officer at Bear Stearns, and chief information officer, corporate comptrollers, at AIG. When he is not improving our client’s operations, systems, and data, he can be found playing guitar in his blues/rock band.

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