Dealers Must Adapt to Millennial Car Buyers’ Needs

Millennials, the largest and most diverse generation in the U.S., are beginning to buy cars in greater numbers. But it’s not clear how well dealerships will be able to serve their needs with business as usual.

For years the automotive industry has speculated that millennials would be the downfall of retail automotive and a bellwether generation for SAAR to shift volume toward the fleet side in support of ride sharing, Uber, Lyft and public transportation. But as this generation has swung into their purchasing power, a different reality has emerged.

Clearly, millennials want conveniences similar to what their parents enjoyed, and are active consumers of retail automobiles as they begin raising families of their own.  But disruptors are taking advantage of millennials’ purchase expectations in everything else they buy.

When we think about our customers today, it’s fairly common to justify our marketing investments, our messaging strategies and our communications habits based on subconscious stereotypes we have applied to them for years via pure muscle memory or at least a conscious assumption of their habits. 

We often think about millennials as the major justification for our industry’s move toward digital marketing given their constant attachment to screens and general avoidance of traditional linear and print media.
Embracing Digital to Entice Millennials to Buy Cars

With the purchase power of millennials guaranteed to expand greatly over the next 20 years, we often get caught up in muscle memory when we think about other generational cohorts, still advertising the way we always have to these different demographics because subconsciously we perceive them to be static. Many dealers look to a digital strategy to satisfy millennials’ demand but then revert to traditional advertising to reach the other generations they’re familiar selling to. 

One blind spot is that a static media mix doesn’t consider the behavioral evolution that occurs in each customer’s subsequent buying cycles.

Thus, dealers’ advertising and sales strategies often become static and stale as generations’ behavior evolves. This consistently leaves marketing allocations and shopping experiences misaligned with customer expectations, competitive offerings, and the distribution of media budgets, and it results in significant wasted spending across profit centers in the business.

The Millennial-Friendly Auto Dealership

Branding is critical for millennials. If your 65-year-old dealership owner still insists on being the face of every traditional television advertisement, you’ll still sell cars to this generation, but you won’t maximize your opportunities. 

Millennials are emotional customers, and it’s critical that they are made the star of their own experience and they feel special in every step of the sale. A failure in service or a bait-and-switch can lead to a crippling onslaught of bad reviews and public shaming across their social media networks that can negatively impact the business for years. They expect online transactions and delivery, and failure to offer seamless experiences here will cost you thousands of dollars a day. Furthermore, digital media is your only way to reach this shopper and your budget should be aggressive and fluid to move where the eyes are across every medium. Streaming connected TV is a force to be reckoned with in this shopper’s journey and represents an opportunity for you to optimize the efficiency of historically wasteful TV budgets.

While a stronger mix of digital advertising gets millennials into the dealership, the in-store experience must also cater to them. Millennials are ripe for upstart online shopping platforms today, but just like how they enjoy browsing products inside an Apple store, so too can they find a similar experience inside a dealership.

A dealer has great advantages over a pure online car shopping platform. From a logistical perspective, dealers are far better prepared than upstart online retailers like Carvana and Vroom where it relates to vehicle delivery experiences, service and warranty work, and ongoing maintenance of the vehicle.

Matt Copley, PureCars (3)

Millennials are interested in buying cars and trucks. However, dealers must eliminate the muscle memory of how they advertise to them and how they sell to them. When dealers embrace an open and flexible purchase process, they open the opportunity to deliver a very Apple-like shopping experience to every customer, both online and in-store.  

Matt Copley (pictured, above left) is director of product marketing for PureCars.