Podcast: Capital One’s Annie Fallows talks AI evolution 

Amanda Harris 07:27:48 Hello everyone, and welcome to the road map from auto finance news since 1996 the nation’s leading newsletter in automotive lending and leasing. It is Monday, April 28 and I’m Amanda Harris. Today is a special episode of the weekly wrap joining me today to discuss the latest in customer experience, dealer relations and technology. Is Annie fallows, head of navigator platform at Capital One. Thank you for joining me today, Annie, and before we dive in, can you please share a bit about yourself and your role? Annie Fallows 07:28:15 Happy to Amanda, thanks for having me. It’s great to be here. I lead navigator platform at Capital One, which is a really fun place to be. We have a cross functional team focused on building innovative technology that helps bring together consumers and dealers for that car of their dreams in a way that is seamless, effective for everyone, and helps dealers, at the end of the day, get their jobs done as well, and super excited to be here with you. Amanda Harris 07:28:46 You know, in today’s environment, What trends are you seeing and how customers and dealers are interacting during the car buying process? Would love to kind of hear what you’re seeing day to day. Annie Fallows 07:28:55 Well, consumers are, of course, shopping more and more online, and what that really means in the car space is that they are spending a bunch of time at home before they come in, figuring out what car they want, what dealer they want to visit, estimating trade ins, you name it. And so they’re really using that opportunity to get comfortable, and they’re expecting to start interacting with dealers during that time frame, too. And so what we’re seeing is dealers who are really successful are leaning into those moments to help consumers, to get their questions answered, to build that relationship, of course, bring them into the store. And then one of the other really big differentiators at that point is to be able to pick up where you left off. That way, the consumer is feeling great. They’re not wondering what happened. And in fact, we see that consumers who have that experience are way more satisfied. But unfortunately, there is a disconnect here. As hard as dealers are working to make that happen, and we hear about three quarters of dealers feel that they are making it happen, but only about half of consumers are feeling like they’re having that transparent and seamless experience. And so that’s where we feel there’s a big opportunity, and where we’ve been focusing a lot of our technology investment is to help bridge that gap from home all the way into the store. Yes, absolutely, Amanda Harris 07:30:16 definitely, something that you know customers are looking for, for sure, you know, what other challenges or pain points are you kind of hearing from, you know, dealers and car buyers and some of the common things that are standing out to you, all that you’re working to address? Annie Fallows 07:30:33 Well, I think there’s, you know, building on that last point, a breakdown in trust, when consumers don’t feel like their expectations are getting fulfilled. They’re doing all of this work up front, and then they’re coming in and oftentimes feeling like they are starting over, and then they’re wondering why, or they feel that a process just doesn’t make sense to them. Why are you trying to collect my information right now when I’m trying to get certain questions answered, and I talked to so many dealers, and they’re working so hard to make it happen, but they are struggling with a multitude of disconnected systems, and that’s really standing in the way of building those relationships that they want to help their consumers, to help get them in the right car and to make the most efficient use of their staff’s time, all of which, Of course, translates into more friction in the buying process, more expense on the dealer side, where I think that there’s a better way leveraging technology to bring players together, Amanda Harris 07:31:34 absolutely and you mentioned, you know that there’s a better way to leverage that technology. I’m curious, you know, what are some of the things that you think does make for a stronger customer dealer interaction. Where is that breaking down? And how do you go about approaching dealers to kind of hear that from them, and to make some of those strides to make
Annie Fallows 07:31:54 that process easier, we spend a ton of time with our dealers. We will spend hours and hours each week in their stores, doing side by sides with them, taking a look at how consumers are not only using our own auto navigator property, but how it’s showing up for them in their store, how things are working on their website. And we are always really hungry to hear that feedback, both from consumers and dealers, and as we do that, we hear some common themes around how we can help make them more helpful. Each of them has their own process, their own secret sauce. We’re not here to replace any of that, but what we do find is that we can help them put their best foot forward by things like having the best buttons on their website. Right? So that when a consumer is going to shop, it’s very easy and apparent to them how they get their needs met, how they can take that step that makes sense for them in the process, how they can get their questions answered. Some folks want to pick up the phone. Some folks want to chat online. Other folks just want to show up in the store, and the best dealers are there for all of it in a personalized and helpful experience. And so that’s what we’ve been doing with Navigator platform. And I think one of the things that we really try to focus on is the quality of the experience. I think we’ve all had shopping experiences, whether it’s an automotive or elsewhere, where, you know, they’re just so hungry to collect that name and contact info, and you can just tell I just went in someone’s lead system. I’m going to get a whole bunch of follow ups that may or may not be helpful, but what we really focus on is the connection. There’s a huge difference when you can tell that whoever you’re buying from that dealer is really there, trying to help you. They’re answering your questions. They’re meeting you where you are. And so all of our systems, our processes, our technologies, are set up to enable dealers to do that, to answer the questions that consumers have, whether it is they’re asking for a new vehicle that’s different than the one that they last shot for, whether it is a follow up on their last vehicle. We want to have all of that context be right there for both the consumer and the dealer, so that they can take that next step. And of course, we are doing that using all of the leading edge technology that we can bring to bear, personalized data, machine learning. We’ve most recently launched a cutting edge agentic AI solution, our chat concierge product, which is leading the way in relevant answers. And I think that’s one of the things. When people talk about the potential of AI, it hasn’t always been with as much focus on what’s really helpful, what’s really relevant to answering those consumer or dealer questions. And so we’ve held a very, very high bar for ourselves. That’s part of the reason that we wanted to go all in on agentic AI architecture, is we knew that that would enable a much more helpful experience. And so we didn’t want to launch something anything less than that. I’m really proud of what we’ve gotten out there. And in fact, what one dealer told me, one of his one of our most recent doctors, he actually horse raced US versus some of his incumbents. And he shared with me he was seeing 6x the performance because at the end of the day, it was really answering his consumers questions, and then they were wanting to come in the store to make it happen. And so as we think about our technology, that’s what we’re here to do, is to be helpful to our consumers and dealers, bringing them together in a high quality way.Amanda Harris 07:35:31 Yeah, absolutely. And you touched on, you know, chat, count yours, and kind of the evolution of, you know, we’ve seen this evolution of building on what was generative AI, which built on, you know, predecessors of AI and technology and machine learning that were already in place. But you touched a little bit on some of the results you’re seeing. Can you dive a little bit more into you know, why Capital One went with this route to kind of go towards the agentic AI, and how important it is to kind of continue to build on those tools and technologies to make them more human like to make them more receptive, note to customers questions and be able to answer those, maybe without even somebody necessarily being involved after hours or whatever it might be.Annie Fallows 07:36:13 So all the way since the inception of capital, one we believe at the core to our strategy is what we call information based systems, and that’s ultimately about bringing that right product to the right consumer, at the right channel, at the right time. And so we’ve done that through marketing. We’ve done that through our digital experiences. And you know, it’s easy to say, but hard to do. You’ve got to get the right data in place. You have to have the right technology stack to do it. A lot of players will try to, you know, do the icing on the cake. And it always falls a little bit short, because at the end of the day, it’s not truly matching the consumers, the vehicles of their choice, to their pre qualification. And you know, it’s good, but it never progresses beyond a certain point. So we’ve been on this journey for truly decades as a company, and over a decade with an automotive to build those data sets, to build the core infrastructure, to build models. And so as we did that, we’ve been coming at this problem of, how are we helpful to consumers, putting the right dealers in front of them, getting the right cars in front of them that meet their needs, that meet their search criteria. And so as we saw chat coming up, it was for us just a natural next step to say this is another way in which consumers want to connect with dealers to get their questions answered about the vehicle of their choice, about their pre quality. Education, so strategically, it was just the natural next thing, as we looked at it, though, in some of the very early forays into generative AI, we saw the risks that were happening externally, around hallucination, models that were inaccurate, things that felt awkward, and we hold a very high bar for ourselves. And so we said that is not an experience that we would feel comfortable putting our names on. And so we really looked hard at what we thought would ultimately be an experience that would not have those challenges, and we said we need to go all the way to agentic AI. We’re not going to spend our time on some of these earlier steps, because we know they’re going to have these downfalls that we’re not going to feel comfortable with. And so we spend, you know, over a year we have some of just the leading AI specialists, and frankly, the country, if not the world, who are working here on this for our dealers and our consumers. And so we went all in. We continued to test ourselves to say, are we getting the level of accuracy, are we getting the level of relevance? And until we see that, we are not going to launch this. And so it’s a huge amount of work to get to that bar. And I’m really, really thrilled that the results are paying off, ultimately, for our customers, and thrilled to see it out in the market starting the beginning of this year, Amanda Harris 07:39:15 absolutely. And you know, I’m curious, you talked a little bit about, you know, the dealers seeing improved performance already. But is there anything else you can talk about as far as the results you’re kind of seeing by going this route and implementing the synthetic AI tool, and some of the ways that that’s, you know, helping improve customer interactions with dealers, helping them, you know, stay around and kind of continue to work with those dealers and work with the bank and, you know, just kind of stay In the pipeline,
Annie Fallows 07:39:42 you know, throughout their their car buying journey, yeah, so we look at a few things. First is, how are consumers using it? Are they asking questions in a way that lets us know this feels good to them? They’re asking questions that are on their mind, and so we see that they are asking the types of questions that you would expect of an interested car buyer, and in fact, they’re not just asking a question and then bailing and disappearing, which would tell you they didn’t really get the value of it. And so that’s been a big focus area for us. And one of the things that I mentioned we wanted to keep measuring ourselves to make sure we feel good about we also made a really intentional choice that we wanted to lead with being helpful versus lead with just immediately trying to collect your name and contact info. And we felt that that was the right answer for consumers, and that while it makes us earn the trust of the consumer, then if we can do that, that’s a real win, because otherwise, we do see that while a dealer might be able to collect the name and contact info, their success on bringing them into the store is very low, and so that was the next thing we looked at, is of people who are then going through this experience. Are they wanting to take that next step? Did they have a good enough experience with chat concierge that they are wanting to follow up in store and come in, and we are seeing that. And then on top of that, we are just thrilled that our dealers are able to take all of that information about what’s happened on the chat in order to pick up in store, get to that, you know, car sale that everyone is working for. And so that’s been very, very exciting for us. We also know this is just the beginning of the journey, so we are continuing to lean in to make both chat concierge itself better, but also to look both internally and externally as to how this framework can extend, whether that’s making our associates more effective, whether that’s looking at additional places in the dealer process that would benefit from this type of an interaction. I think we’re just at the beginning of a very exciting new journey, but for us, it all starts with making sure that our models and our technology are working the way that they’re intended, that they’re providing those high quality interactions
Amanda Harris 07:42:03 absolutely so to kind of wrap up, I would love to just kind of hear your thoughts on where things are headed for you all. So what, where in your mind? You know, top, top of mind trends that you want to keep on touch on where should capital, one tech investment, kind of be focused and, you know, just where you will be kind of focused on next couple years or down down the road? Annie Fallows 07:42:25 Well, we just continue to work back from our customers. What are they telling us that they need, whether that’s consumers or dealers. And of course, the same thing holds across the company, and what we continue to hear from consumers and dealers is while. Things are evolving, their core needs remain largely the same. Consumers want to be able to shop. They want to find what works for them in a way that makes them feel confident with such an important decision. Dealers want to meet those consumer needs. They want to do so efficiently. They want to do so in a way that enables them to win the sale. And so we continue to lean in on how we can improve that journey by providing context across the journey, bringing consumers back in a high quality way that feels good to them, and continuing to leverage our technology to solve more and more of those problems on their behalf. Amanda Harris 07:43:21 Wonderful. Well, I’ll be keeping a close eye, of course, as you all evolve and do more exciting things that you always are. So I very much appreciate it. Thank you so much, Amy, for a great conversation today and a look into what you all are doing on the technology front. It’s very exciting, but that will wrap up today’s episode as always. Thank you for joining us on the roadmap, and be sure to follow us on x and LinkedIn and we will see you online auto finance news.net, in here next time you.