News and views from the automotive industry.
FCA regulation changes impact on GAP sales
One week until AM Live – Wednesday, 16th November – when Car Care Plan will tell an audience of 500+ automotive industry delegates how regulation changes one year ago lead to a surprising boost in GAP sales.
After the changes in September 2015, consumers are now focused on quality over price, Allan Lewis, National Dealer Development Manager, will say. Car Care Plan are one of the sponsors of the F&I Theatre at the unique industry expo.
The impact of GAP regulation changes
Car Care Plan GAP sales have increased by over 7% since the Financial Conduct Authority (FCA) changed the rules on how the product is sold. Those changes included:
- Introducing a sale deferral period
- Providing prescribed pre-sales information.
“When the regulations were first introduced, they did create a degree of uncertainty, and we will be taking a closer look at how they have been interpreted and how the regulations have impacted the sales process,” Allan said. “It takes a while for the longer term impact to manifest itself and, as an industry, we are all still adjusting.”
He added: “Interestingly, by having a process which all employees have to follow, it has meant all customers now receive the same GAP experience, ensuring the product is considered by all car buyers, which in turn has boosted sales.”
Our next eBook takes an in-depth look at the impact of FCA Regulations on the sale of GAP.
Sign up to our newsletter to keep up-to-date.
How retailers can boost GAP sales
The FCA changes meant new sales processes had to be put in place. So Car Care Plan worked closely with its partners to help them adjust. A host of new materials were created to provide a clear, concise understanding of what the FCA expected, expert training was available and new sales models were developed to incorporate the four-day deferral period.
Allan said: “New methods of introducing GAP have had to be initiated, such as starting the clock ticking earlier, or by utilising our outbound capabilities to create a more efficient and slicker sales process.
“One of the major changes we have experienced is the comparison with online providers, which has created a massive opportunity to showcase the quality of dealer products because the consumer looks at them side by side.
“It is very obvious that cheaper products often don’t compare, especially now defaqto ratings are being used, allowing consumers to easily see a five-star product compared to another which scores below. The shift in focus by the consumer from price to quality has become very apparent.”
To learn more about GAP, download our FREE eBook: Complete guide to GAP insurance.