Don’t Be Subpar with Your Subprime Marketing

by Admin on May 26, 2014

Subprime, also known as near-prime, non-prime, or second-chance, refers to both the type of borrower and loan given to someone with less-than-perfect financial history. Personally, as an American, the word “subprime” conjures up memories of the 2008 national crisis, housing bubbles bursting and foreclosed homes. Unlike the American Housing industry, subprime in the the Canadian Automotive industry is a win-win for everyone.

A subprime candidate may have numerous reasons and very unique situations, which puts them in the subprime category. Bottom line is when they shop for a car, they know they may have difficulty reaching their goal of owning a new vehicle and/or making that vehicle’s payments on time. No matter the particular case, dealerships know that everyone deserves a second chance. The really smart ones are targeting this subprime audience to let them know that they are welcome at their business, and that they will do anything possible to get a subprime customer behind them wheel of one of their cars on the lot.

As stated before, Canadian dealerships and consumers are in a much better position than other markets. Canadian banks and trust companies extend subprime offerings far beyond those of their southern counterparts in America, offering credit cards and car loans in addition to mortgages. These banks see the mutual benefits in a subprime borrower to lender relationship. On one hand, the bank builds a lasting relationship and potentially lifetime customer with the borrower and protect their assets by ensuring a manageable rate, so that they get paid on time. Both these factors, especially the latter, are clearly beneficial to the borrower! The borrower also gets the joy and pride of vehicle ownership and rebuilds their credit score at the same time.

With so many lending options available to the massive subprime market in Canada, it’s no surprise that securing a subprime customer online is extremely competitive. The keywords a bank or dealership should bid on to drive traffic to their website solutions geared for subprime customers are very expensive, on par if not higher even than the used car market, which is saturated with competition.

Open a new window or tab, go to right now, and search “subprime car loan.” No matter your area, you’re sure to see quite the mix of major and minor companies promising financial freedom with the easy, secure, online means to start the car financing process in just a few steps.

Here are some examples of online subprime-marketed solutions, starting with Canadian banks first:

Here are some known dealership-associated approaches, ranging from blogs to micro sites and even just an additional page on their main domain:

And last, but certainly not least, the ‘other’ solutions:

  • Loan Doctor
  • Canada Car Loans Now
  • Applewood Credit
  • Canada Auto Loan
  • We know this must be associated with one if not many dealerships, due to their branding of all their available makes and models along the very top of the website, but they call themselves the generic “Advantage Auto Loans.”
  • Cars Direct – a United States Example, out of California, that reaches into the search market!

Ask yourself, among the “others,” are these websites truly just companies out to help the subprime shopper with a subprime auto loan, or are they a cleverly marketed veil that floats just over a dealership’s face?

You would have to start their application process to be sure; but many dealerships are taking their financing departments to an entirely new level by branding them independently from the store and the brand they physically reside in.

This helps the dealership build up their subprime financing department’s own reputation and customer base, without having to associate with one dealership alone. Benefits of this more ambiguous or independent branding include, but are not limited to:

  • Reaching a wider customer audience
  • Offering more car makes and models by not being pigeon-holed into your OEM’s brand alone.
  • Marketing not only the promise of loans but of inventory to shop online.
  • With a dealership’s online lot on hand, your potential subprime customers can not only start the loan application process but also start car shopping actual units all in one easy place
  • See New Leaf in BC as a great example for both applying for financing and car shopping all in one spot
  • Capitalizing on keywords and terms not yet saturated in your digital area for search engine marketing
  • Separating oneself from, if your particular case, any negative sales, service, or finance reputation online that exists for your dealership

If your dealership has a very positive online reputation, there’s really no need to invest in an expensive solution that takes resources from your staff to separately market your finance department and give it its own brand. You can tie in your subprime financing offerings with your actual brand name and still target the same subprime audience while tying into the strong reputation of your store.

The options, methods, and successes of marketing your subprime financing department online are only limited to your creativity and budget (and your website provider/marketing firm’s abilities!)

Have questions about how to market your subprime financing department online? Please comment below!

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