What Less Teen Driving Means For Brands

by , Nov 7, 2013, 9:50 AM
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When I was a teen, my friends and I couldn’t wait to get our own cars. We begged our parents to teach us how to drive, help us get our driver’s licenses and buy our first cars. It was a rite of passage that was as American as baseball, hot dogs, apple pie and, well…Chevrolet. 

However, times have changed, and today, teens are just not as car-crazy as they used to be. In fact, studies show that teenagers are delaying getting their licenses. In 2012, 73% of high school seniors had a driver’s license—down from 85% in 1996. The shift in car popularity is so surprising that we recently studied the top brands loved by Millennials and found that not a single car brand is among the top 25. While companies like Google and Amazon are connecting well with Millennials, car brands are dropping off teens’ radars. 

Many factors have been influencing the end of car culture in America. Factoring in maintenance, gas and insurance, driving is more expensive than ever before. And, with less income because of teen unemployment and growing student loans, teens simply can’t afford to own a vehicle. 

It’s hard to overstate the business implications of this trend. In the U.S. alone, the auto industry represents 8 million jobs. With teens driving less, many industries need to examine their assumptions about how people shop. Here are three things brands can learn from this shift—and what they can do to protect their brand in the long term: 

1. Talk to non-customers 

The auto industry is so deeply engrained in the economy that declining sales can disrupt distant businesses. The advertising industry, for instance, should be concerned since automakers have significant marketing budgets. 

The ability of car sales to negatively impact far industries demonstrates why brands should keep an eye on companies outside their own industry. Doing so helps reveal trends that may eventually impact their own sector. (On the flip side, these companies can provide inspiration, if they’re doing something right.) 

How do you take the pulse of outside companies? By talking to the people that know them the most: their customers. Consumers who are not yet your brand customers can offer perspectives that your loyal customers may not have. 

2. Use longitudinal research to get a holistic view 

The decline of the car culture provides a reminder that Millennials have values different from those of their parents—values that promote mass transit as something pro-social and, therefore, more attractive than driving in isolation. And this change in people’s values highlights how brands can sometimes get so enmeshed in the details that they miss the big picture. Yes, it’s important to test ads, branding or product ideas. However, it’s also critical to understand the factors in and outside your industry that affect people’s path to purchase. 

Take the mobile revolution, for example. With smartphones, it’s less crucial now to have a car to “get away” or connect with friends. To talk to a friend, a teenager just needs to open Snapchat on her iPhone. To appreciate the mobile impact, marketers need an understanding of people’s attitudes toward this technological revolution. 

Waning car sales highlight the need to consistently research the macro and micro factors that drive purchases. Longitudinal studies can help detect and find solutions to macroeconomic trends that affect brands. 

3. Innovate with customers 

Lower car sales present opportunities to innovate. In fact, Jeremiah Owyang’s work on the collaborative economy shows how startups such as Zimride and Nuride already capitalize on this trend by enabling ride-sharing. Established brands can gain a lot from identifying the factors that drive the success of these startups. 

Innovation doesn’t have to stop there. Through crowdsourcing and co-creation, some brands already tap into consumer insights to collect and refine new offering ideas. Brands affected by weakening car sales can ensure future profitability by injecting the consumer voice a lot earlier in the process. 

Stalling car sales aren’t exclusive to teens. As of 2011, the average American was driving 6% fewer miles per year than in 2004. For brands, this shift in consumer preference is a huge and largely untapped opportunity to bring new ideas to the table and re-imagine their offerings to better fit contemporary consumers’ lifestyles.

1 comment on "What Less Teen Driving Means For Brands".

  1. Heather Garcia from Resonate
    commented on: November 7, 2013 at 11:03 a.m.
    See what motivates #millennials to purchase #automobiles! ow.ly/qknwt

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