We're helping RAC dealers succeed as they return to trading

News Release

Sean Kent, RAC Director of Sales at Assurant, the Fortune 500 company that partners with the RAC in the warranty and aftersales sector, explains how they are supporting the 1,500 members of the RAC Dealer Network as lockdown eases.

Sean, can you tell us about the RAC Dealer Network?

Sure. The RAC Dealer Network consists of used car retailers right across the country including independents, franchises and car supermarkets. We work with them to provide a high level of aftersales support to their customers, based around RAC warranties that are underwritten and administered by Assurant, a Fortune 500 and S&P 500 company.

Our roots date back more than half a century to the legendary Pat Ryan, a pioneer of F&I best practice in the UK. Today, we continue to follow a comprehensively modernised version of his core ethos of providing excellent products, relevant training, superb account management and high-quality marketing support.

The RAC Dealer Network warranty proposition is focused on giving the best value to car and van buyers. We provide a choice of four levels – Platinum Plus, Platinum, Gold and Silver - to suit every need alongside important benefits such as no customer excess to pay.

There is also the RAC Approved Dealer programme, designed for members of the network who want to take their proposition a step further. It is based around detailed preparation criteria created specifically for the RAC, a minimum three-month RAC warranty, 12 months of breakdown cover, a vehicle data check and enrolment to RAC Accident Care. Because of this additional level of commitment, we allow stronger use of the RAC brand, which helps to increase customer confidence.

What have you been doing to support dealers through lockdown?

Fundamentally, we have been working to make sure that the service offering to both warranty holders and dealers has remained consistent and strong, even while our employees have been largely operating from home. That has meant not just ensuring business as usual but also looking at what we could do to help on a practical level during the crisis. We have been determined to play our part.

When it came to motorists, our approach has been to ensure that there has been no customer warranty detriment resulting from the lockdown, so we are committed to considering all relevant claims regardless of the plan or the policy’s expiration date.

On the dealer side, our account management teams have been working closely with members of the RAC Dealer Network remotely and helping them plan for what used car and van markets might look like as we ease out of lockdown, including how their propositions may need to change. We’ve also held a series of virtual workshops for dealers that have been very well-received, with around 100 people attending each one. Again, these were designed to help them prepare their businesses for the future.

Where do you see car and van retailers heading now?

We’ve been doing a lot of work with the network over recent weeks, preparing the way for wider use of online sales combined with click and collect or home delivery, and our view is that warranties are set to become a more important element in the used car and van sectors because they play a key role in generating consumer confidence.

Someone making a major purchase entirely online, such as a vehicle, wants to have firm reassurances that they’ll be protected if something goes wrong. When a potential buyer is sitting at home looking at a vehicle during lockdown on their phone or tablet, the warranty becomes a crucial part of the decision to purchase, especially when it bears the RAC name.

Also, for our RAC Approved Dealers, there is the added security brought by factors such as our preparation standard, breakdown cover and more.

How do you help dealers maximise the impact of the RAC brand?

Customers know that the RAC would only allow its name to be applied to dependable and trustworthy retailers – and our research shows that more than two out of three car and van buyers feel more confident thanks to its presence. In the post-lockdown new normal, this trust becomes more important than ever before.

So, one of the things that we have done is create a series of digital assets designed to be used on dealer websites, in social media posts and through other digital communications to make the most of this branding advantage. These include messages and animations designed to support “click and collect” trading models. They are designed to really underline the credibility and trust that the RAC brand brings to the Dealer Network for remote customers and are being delivered

through our online marketing support facility, The Engine.

In addition, we will soon provide point-of-sale material designed to be used in the showroom that supports safe distancing, including signage and floor stickers.

Are you planning any other marketing initiatives for dealers?

Yes. From June, for a minimum of three months, we’re running a new campaign that is designed to build on the idea that the warranty is becoming a more important element of the sale. On any Platinum Plus, Platinum or Gold level policy, we’ll double one year of cover to two years at no extra cost.

Dealers taking part can opt to use this in a number of ways that is appropriate to their proposition. Some might choose to put 12 months of standard cover on their car that is then automatically increased to two, creating a very strong overall offering, while others might use it as an incentive for customers who are buying a one year warranty.

This could have a genuine impact for dealers starting to concentrate on selling remotely. It is a lot of high quality warranty cover for a very low cost.

Do you believe there will be new opportunities coming out of lockdown?

Something that we believe could happen quite quickly is that dealers moving into online sales could gain a much larger geographical footprint. According to pre-coronavirus crisis research, 37% of buyers travelled more than 20 miles to buy from a network member – but the improved digital presences now being developed by retailers could drive this number higher.

Online car and van showrooms are a great leveller. If, as a dealer, you have a vehicle that the customer wants, the right overall proposition, and the ability to deliver or offer click and collect, then how far away you are becomes much less of an issue. It would be a stretch to believe that every vehicle retailer can develop a national presence but not to say that, for example, your current average 25 mile footprint could increase to become the distance a customer might be able to travel in two hours, or even more.

Are you still aiming to grow the network during 2020?

Yes, before the lockdown, we signed up around 120 dealers, placing us well on the way towards our overall target for 2020 of 170, and our overall levels of business were up around 15% year-on-year. The new dealers include Millennium Motors of Edinburgh, Burford Car Sales of Hertfordshire, Ashridge Vehicles of Berkhamsted, Luton Trade Centre and Hilton Garage of Derbyshire, just to name a few. The reasons for joining the network differ from dealer to dealer but it is possible to identify some key trends, ranging from the impact of positive differentiation offered by the RAC name to our dealer consultancy services.

We’ve always maintained, since the network was launched, that while we have targets for growth, we will always put quality first and only add dealers who share the RAC’s customer service ethos. More and more of that type of dealer is moving over from competing warranty-based programmes, which we believe is a very positive sign.

 


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