OPERA SOLUTIONS CAPABILITIES. Automotive Solutions: applying advanced analytics throughout the automotive life cycle

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1 OPERA SOLUTIONS CAPABILITIES Automotive Solutions: applying advanced analytics throughout the automotive life cycle

2 2 From origination to retention to termination, Opera Solutions takes new routes to higher performance Overview Intelligent machines once transformed automotive assembly lines. Now machine intelligence is transforming the rest of automobile industry. Opera Solutions is on the forefront of this revolution. Our combination of smart industry experts powered by advanced analytics lets us deliver more effective promotions, greater customer loyalty, better prices, and fewer no sales at auctions. And we can provide all this with end-to-end services that require little or no IT and infrastructure investment on your part. In fact, whether you re focused on originations, customer loyalty and retention, or remarketing, chances are we can accelerate your drive to profits. Here s how:

3 3 1. Origination Using a combination of predictive analytics and our deep understanding of what drives customers to buy, Opera Dynamic Marketing can identify who is, and who isn t, a likely target for a particular promotion. We can also determine, on a customer-by-customer basis, what level of incentive offer is enough and how much is too much. This information powers a dynamic marketing program which delivers a series of stepwise offers scientifically designed to change behavior and attitudes over time. In addition, our advanced models can accurately determine which campaigns work and which ones don t and make spend recommendations accordingly. For example: In another arena of originations, lending, Opera can make credit risk evaluations more accurate through our proprietary likelihood to default models. Our models work better because we factor in a wealth of unexpected data, such as the stress individuals real estate holdings might be placing on their credit situations. And we use up-to-the-minute data from a wide range of sources that we know to be predictive. Then, we put all this fresh and powerful data into an ensemble of advanced nonlinear models that effectively parse the intricate relationships among interest rates, unemployment rates, real estate factors, and the borrower s income, credit, and debt characteristics. We looked at all of a European car manufacturer s UK promotions from a two-year period to determine which ones really accelerated sales. Using advanced analytics, we were able to isolate and quantify the true impact of different tactical marketing programs. The results were surprising: some of the lowest-cost programs were actually the most effective, and some of the most expensive programs hadn t worked very well at all. Overall, we identified opportunities for the client to cut marketing spend by 20% with no loss of sales.

4 4 2. Customer loyalty, retention and intervention Advanced analytics can provide insights into an individual customer s buying habits and financial situation as detailed as his or her vehicle s service history. That, in turn, makes possible the targeting and timing of reminders, incentives, and offers most likely to result in increased, and ongoing, brand loyalty. Opera s ability to create a 360⁰ longitudinal view of each customer s relationship with you and the dealer over time and to use this information to predict behavior and make recommendations is a next-generation approach to creating satisfaction and keeping customers loyal. If your responsibility is managing a car loan portfolio during this middle phase of the car ownership cycle, Opera s risk management capabilities can help you reduce exposures and take early actions. We serve six of the top seven leading credit issuers, using more predictive data and applying longitudinal tracking methodologies to analyze individual customers behaviors over time. Opera can determine whether red flags in a customer s credit situation are one-time anomalies, or if they re indicative of potential deep-rooted credit difficulties. And for troubled accounts, we can develop strategies to minimize losses and increase payments. For one major lender, Opera s advanced analytics identified and prioritized accounts for early intervention. The result was a 15% reduction in losses and a $50MM increase in profits. For another client, our solutions reduced defaults by 20% while increasing collections by 7%.

5 5 3. Termination & remarketing Opera provides advanced solutions to help you make the most of the automotive resale market in three ways. First, we combine our predictive analytics and technology expertise into a dynamic, constantly updated wholesale pricing optimization model to accurately predict floor prices for each vehicle. For one manufacturer, this greater confidence in floor prices has resulted in more cars sold the first time offered, fewer no sales, less time spent in inventory and, on average, $150 more realized for each car sold. In addition, the higher sales prices reported to guide books have a positive impact on future residual values. Second, every remarketer knows that virtually identical cars with only slightly different characteristics can sell for dramatically different amounts often varying by hundreds of dollars depending on where they re auctioned. Our allocation model lets you determine where to send a vehicle to make the most of these differences, net of expenses. Third, our visualization tool significantly improves productivity. Manufacturers representatives at auctions around the country receive the latest pricing information through Opera s proprietary Auto Auction Pricing Optimizer on an ipad or other tablet computer. The Optimizer Dashboard updates pricing data after each vehicle is sold, allowing reps to manage the overall sale much more effectively. Our Management Reporting captures and relays sales information after every auction, allowing remarketing executives to dig deep into the details of vehicle sales and obtain a clear picture of what s working, what isn t, and why.

6 6 4. Superior analysis and solutions, end-to-end and bumper-to-bumper With Opera, you can count on getting the best possible results with little or no IT investment on your part and virtually no disruption to your current data operations. We take your existing data flows and run them through our assembly line (otherwise known as our Insight Bureau), applying our advanced analytics and installing connectors and interfaces as needed. Then we run it all back to you for use in every phase of your business. 5. Your Destination: Greater Profits No matter what stage of the automotive lifecycle is your primary concern, advanced analytic solutions from Opera can help you manage it more profitably. For more information, or to contact us, click here.

7 ABOUT OPERA SOLUTIONS, LLC: Opera Solutions drives productivity for enterprise and government through advanced Big Data predictive analytics that create machine-generated directed actions to significantly improve front-line decisions. Its Signal Hub technologies provide organizations an enterprise-wide capability to continually extract and put to use newly available predictive information from outside their firewalls, creating a revolutionary pathway to productivity, profit, and advantage. With 230+ data scientists among its 700 employees, the company is an internationally recognized leader in machine learning. It serves enterprises in Financial Services, Healthcare, Government, Supply Chain, Marketing, and other sectors, with offices in North America, Europe, India, and China. New York Jersey City Boston Washington, DC San Diego London Shanghai New Delhi