If they want to sell cars to Millennials, dealerships need to be on top of the technology under the hood.
That’s a key finding in Cox Automotive’s “2017 Car Buyer Journey Study,” which was recently released. A subgroup analysis looked at differences in income levels and generations, particularly household incomes of less than $75,000 and those greater than $75,000 as well as Millennials vs. Gen Xers vs. Boomers vs. Pre-Boomers.
The findings paint a clear picture of today’s car shopper composite and
affordability in auto retail, says Cox Automotive:
Millennials are most likely to shop for used vehicles, given the current incentive rates and deal-making opportunities to purchase for less than the sticker price.
Millennials’ frustrations tend to be financial-related, such as getting the best price and financing.
The study comes at a time when the auto industry’s annual volume index is flattening and probably peaked in 2016, says the company, as evidenced by recent production cutbacks at Ford and General Motors. So, automakers and banks are trying very hard to keep demand up, and they are throwing lots of incentive money (automakers) and affordability tools (used car leasing) at consumers.
Further, the industry is in the middle of the largest used car surplus in history, and the leasing volume peaked in 2013, producing a glut of off-lease used vehicles.
Steve Lind, senior vice president of operations and general manager at Autotrader, has been in the business for 20 years and he says that for Millennials earning less than $75,000 a year, there are “great new ways to shop for cars. Affordability is at the heart of the matter.
“We see them visiting more dealers and taking longer to make a decision on a car. This is a reflection of this generation of car buyers. They have so many options and much more complicated technology. The content is fantastic and the reliability is so good, they have a broader choice.”
Smart dealerships should be digital marketers, creating multiple online sites to show their many showrooms, display their merchandise in high-quality photos, price the cars to market and give Millennials a good experience in the showroom, Lind says.