Everyone in the supply chain, from the provider to the consumer, benefits from immediate access to information. The popularity of smartphones and tablets has created a whole new platform to reach the consumer through the proliferation of mobile apps. First, let’s take a brief look at how the OEM’s are embracing mobile apps, then we will explore how providers and administrators are already beginning to innovate.

Today, the smartphone has changed the information landscape in ways no one could have dreamed of as recently as the 1990′s. The single most appealing aspect of a smartphone for a business and the potential to connect with its customers is the fact that the device goes everywhere with the user. As the cell phone morphs from a voice communication device into a personal information portal, how can we capitalize on this trend and bring more value to our customers?

Ford has been a trailblazer with the launch of AppLink, which allows SYNC users hands-free voice activation of mobile apps like Pandora. Mercedes Benz’s mbrace allows users to interact remotely with their vehicles using the iPhone and Blackberry for such things as remote door lock/unlock, vehicle finder, concierge services, and contact assistance for roadside assistance, customer service, and their financial client care center.

OEM’s like Porsche and Kia are using mobile apps for marketing. Porsche has a mobile app that provides information on the Pamanera, while Kia has not developed its own branded mobile app but advertises through third parties within other apps. Ford and Mercedes Benz, by delivering mobile apps that interact with the vehicle and provide useful services, may be better positioned to capitalize on this burgeoning technology because only 10% of users think ads on mobile devices are acceptable.

If a mobile app is a better website and is a clever answer to the question, “Who is going to type in lengthy URL’s into a smartphone?,” a mobile app is just like a “favorite” or a “bookmark.” Mobile app developers are combining information and functionality, not just in the smartphone, but within the vehicle itself by the use of third-party apps rendered via smartphones into the vehicle head unit. OEM’s like Hyundai, with its monitored telematics solution BlueLink, Ford’s Focus Electric and the Nissan Leaf are hosting connected services directly into the head unit as native apps.

Mobile apps, whether accessed from a smartphone or a tablet, offer opportunities for the provider or administrator to connect with its supply chain. “Communication through mobile devices is becoming an integral requirement for most businesses and this part of the auto industry is no exception,” states David Trinder, CEO of F&I Admin.

Connecting administrators and consumers through mobile apps can provide information to VSC contract holders to better maintain their vehicles. Allstate Dealer Services, through their mobile app CarMor Vehicle Care Center, offers consumers free access to manufacturer’s recommended maintenance schedules, recall alerts, a vehicle maintenance log, details of the service agreement, and dealer contact information.

The apps are free, easy to download, and are accessible from the smartphone or tablet “desktop.” Once in the application, while browsing through, for example scheduled maintenance, the user may find coupons and specials that apply to the next service. This increases the likelihood of a visit to the selling dealer. The possibilities for marketing tires, quick lane service, and other accessories and services through the mobile app are limitless and dovetail nicely with the dealer’s fixed operation retention efforts.

The possibilities for mobile apps to connect administrators with inspectors, agents, and dealerships are just over the horizon. F&I Admin’s innovative leap into this arena is just the start of what will surely be a growth sector within our industry. The company maintains that as an F&I administration solutions provider, it is crucial that they deliver the latest technologies and capabilities. Trinder sums it up by saying, “Providing mobile solutions is imperative if the intention is to provide the tools you need, the connections you need, and a system that helps you grow your business and build efficiencies in every way possible.”

These devices and applications could expose pertinent data that are contained in a variety of repositories to users. “Imagine the value to agents and other field staff,” says Trinder, “when the provider delivers mobile access to updated contract information, sales production reports, and territory analysis.”

Agents play a huge role for providers as an independent, indirect sales force. Supporting agents with real-time analytics and tools to help them understand the dealer’s activity keeps both parties on the same page and will improve customer service. Better customer service for the agent and dealership generally results in higher revenues for the provider.

Implementing mobile devices and applications is an inevitable technology solution for insurers. F&I Admin’s COO, Kumar Kathinokkula, told P&A, “Just as system integration and industry standardization provide significant efficiencies for providers and administrators, mobile devices and applications bring about efficiencies in business processes and administration through immediate access to information.”

The potential efficiencies of utilizing mobile apps which Kumar speaks of regarding business processes has not translated yet into marketing and sales in our vertical. An interesting quote from Jim Stogdill, writing for a website about emerging technologies, reads: “You aren’t buying a computer when you buy an iPad, you are buying a 16GB Wal-Mart store shelf that fits on your lap…and Apple got you to pay for the building.”

Substituting the name of your company for Wal-Mart in the above quote raises some interesting possibilities. Since many mobile apps are really web pages without URL’s, is there a way to monetize them? What about a mobile app that offers answers to FAQ’s a consumer may have about vehicle service contracts, then asks them to select which brand of vehicle they are contemplating purchasing? The app then directs the consumer to the nearest dealership selling that brand, and coincidentally sells your products. Would a dealer pay for that lead?

We are seeing just the tip of the iceberg today with mobile apps. Major vehicle manufacturers like Ford, Mercedes Benz and Porsche, and content providers like YouTube, Pandora, and Twitter, are working feverishly to meld hand-held devices with content, services, and marketing. The vehicular mobile app landscape is in its infancy, and innovators within our own community are already exploring the opportunities that this exciting technology has to offer.

In June, P&A Magazine published an article titled “The Integrated Industry: Software Fact or Fiction?” which outlined the industry’s longstanding challenge of integrating various mission-critical software applications with the typical dealership management system (DMS).

Sharing data with the DMS is an important requirement for providers of F&I products, and streamlining this process ensures accurate data, fewer errors, reduced costs and improved customer service. Until very recently, the lack of direct, complete, and transparent integration into the dealer’s DMS meant continued security issues, costly hardware and a slew of inefficiencies for F&I providers.

These are precisely the issues that drove Open Dealer Exchange, LLC—a joint venture between Automatic Data Processing, Inc. (ADP) and the Reynolds and Reynolds Company—to acquire a comprehensive solution that would transform the industry and provide F&I aftermarket providers with solutions critical to growing their businesses.

The result is the Provider Exchange Network (PEN), the industry’s sole provider-focused DMS interface. PEN was created to streamline the F&I process by establishing direct connections to the dealer’s business partners, and as a provider-oriented network, automating provider functionality within the DMS.

This initiative is an industry first in allowing full data sharing between the DMS and the provider, challenging the historical integration model that was clearly in need of modernization.

Modern Software Model for Minimum Errors, Maximum Efficiency

Data sharing with the DMS is important because this is where the F&I manager prints contracts for aftermarket products and adds them to the vehicle sale transaction. The dealer’s accounting staff also relies on the DMS to authorize payments to the provider in virtually every sale. For product providers, DMS integration means presenting rates, preparing forms and originating contracts electronically. Automating these processes reduces errors and saves time and energy for all parties involved—providers, dealers and vehicle buyers.

Yet until now, providers were as efficient as their weakest link. Incompatible systems and an inconsistent exchange of digital versus paper information took a significant toll on provider opportunities. Although progress was being made, the industry was ultimately in limbo as providers clamored for a better solution.

One solution is for the provider to supply rates to a complementary system, such as a menu or a desking system. A menu system is a particularly good choice, because these systems are designed to enhance the sale of F&I products. Some providers even invest in their own dealer-access “portal” sites. These sites typically support the three key selling functions, as well as reconciliation, remittance and a variety of other features.

All of these solutions depend on DMS integration. Without it, the F&I manager must re-enter DMS data into one or more extra systems, and then circle back to the DMS to ensure that all products are represented correctly in the vehicle sale transaction. This is a particular headache in the case of insurance products, where the premium may depend on the prices of other products in the deal.

Provider-oriented systems like menus and dealer portals can do part of the job, but still depend on the DMS. What providers – and dealers – need is two-way communication between the provider and the DMS.

PEN’s digital pipeline has filled that void and defines industry protocols by directly integrating the provider with the dealers’ point-of-sale (POS) system—streamlining the sales process and reducing costs through rapid, accurate and secure transactions in a paperless process.

“Integration with the DMS is vital so that dealers don’t have to re-enter customer and vehicle information,” says Gary Volino, chief operating officer of Safe-Guard Products International.

Chris Morris, senior director of Product Planning at Reynolds and Reynolds, says, “Because it allows the F&I manager to work in a single system, we see PEN as the optimal way to handle F&I products on the DMS, maintain the integrity of the dealer’s process and ensure the security of customer information.”

Secure Transactions for Customer Confidentiality

Ensuring the confidentiality of customer data is not only a sign of integrity, it is the law. In the automotive industry, this means that dealerships, DMS providers and F&I product providers have shared responsibility for protecting vehicle buyers’ sensitive information.

Today, product providers’ use of “hostile” third-party interfaces to access DMS data can jeopardize customer information and put providers at risk for lawsuits.

PEN solves this problem because rather than extracting DMS data to support a third-party application, it provides an application programming interface (API) for use by the DMS so rating and contracting functions are incorporated into the DMS. There is no intermediate system or security risk, and all customer, vehicle and financial information is sent directly from the DMS to the provider.

Matt Nowicki, director of IT for IAS, and Patrick DeMarco, president of Ristken Software Services, have both stressed the importance of using a certified interface to protect the dealer’s interest in data security.

Paperless Process for Convenience

Amid today’s electronic-focused mindset and rapidly evolving technology, it doesn’t make sense for dealerships to keep filing and piling large amounts of paperwork. PEN eliminates this process by serving as a single interface where a dealership can rate, contract and submit all of its F&I products electronically to reduce cost—and conserve forest resources.

PEN pre-populates all forms using DMS data and loads them into the PEN forms library. Or, for providers who desire paper contract forms, there is the option to supply forms using their own web services.

Providers hosting dealer portals typically employ a Service Oriented Architecture (SOA). This means they can connect to PEN using the same web services that support their portals. Again, this is not DMS integration in the traditional sense, because data traffic between the provider and the DMS bypasses the portal. The provider will receive completed contracts from both PEN and the portal and, thanks to SOA, there will be no difference.

“We are starting to see the DMS providers tightly integrating with menu solutions, where PEN is providing the data integration,” states Volino. “In this case, the Safe-Guard Portal is only used to verify and remit funds for the F&I products, but we suspect over time, the remittance process will be more tightly integrated within the DMS.”

This modern, electronic contracting system results in cleaner, more accurate deals, increased customer satisfaction, and potentially faster funding for the dealer.

What It Means for the Industry

There is no doubt that the last couple of years have been tough on the auto industry. An integrated solution that lessens the workload and enables providers and dealers to stay focused on their core business—reaching more customers and selling more products—is ideal in today’s environment.

Recognizing the challenges the industry was facing and the great need to provide a comprehensive solution for streamlined data sharing, PEN’s main objective is to automate provider functionality within the DMS, transparently and without disruption to the F&I process. This unique approach turns the old integration problem on its head because instead of the provider seeking integration with the DMS, the DMS will now be integrating with them. The industry will continue to benefit from this model and embrace it for maximum success.

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