Monday, February 23, 2015

Editorial: The conundrum of the millennial car buyer

It is not exactly news that millennials have a very different approach to many things. Whether it is how they choose places to live or conduct themselves on the job, the younger generation that is now making their mark on adulthood have made it clear that they like to do things their way. This also applies to driving and car ownership. Much has been made in the last year about how the automotive industry continues to struggle to find ways to attract a younger generation of drivers to the dealers to make car purchases, new or used. Some of that has been attributed to a whole different attitude towards driving, others posit that graduated licensing laws have made the desire to drive less imperative, while yet still others theorize that the recession and its lack of job opportunities means that the younger generation simply has less disposable income to spend on a luxury purchase. Research dollars continue to pour into the subject, but with seemingly few tangible conclusions. As a member of the millennial generation, as much as I would like to deny it, allow me to offer a few of my own thoughts on why automakers are continuing to struggle to appeal to younger buyers.

First, there is the belief that millennials don't drive. On some level, this belief is not without merit as most millennials, my wife and I included, seek out living arrangements that offer many of the benefits of urban living (lots of restaurants, shops, and public transit within walking or biking distance) that reduce our need to utilize a car on a daily basis. However, many millennials also lead very active lives and we frequently participate in activities that take us to places that are not necessarily accessible, or at least reasonably conveniently accessible, by public transit. Therefore, many of us still require access to a car that allows us the flexibility to get where we need to go.

It is how we approach gaining access to that car that is different than in the past. The millennial generation is big on advancing the sharing economy, so where it is feasible to do, we find ways to share our resources. That is why car-sharing services such as ZipCar have been so popular among our generation as it offers nearly the same convenience of owning a car while limiting the costs and hassles. Ride-sharing is also a popular alternative as it even reduces the need for driving, So it is not necessarily that millennials have given up on driving altogether, but rather we have reduced the number of miles we drive and how we approach the miles that we do drive, a fact that automakers must recognize.

Second, we absolutely hate the car buying process. The endless haggling and wading through the lies of dishonest car salesman has many millennials petrified of being cheated when they walk into a dealership. While I am not personally one of those people, I have helped many a friend avoid being ripped off while looking into new cars. Yes, there is an endless stream of advice on the Internet about how to get a good deal and online resources are about as abundant as weeds, yet walking into a dealership to complete the purchase still changes the dynamic and can be daunting to those who are doing it for the first time. Add to that the fact that the younger generation is actually more particular about what we want in a car, the typical dealer test drive simply does not offer enough time or information to allow for an informed decision.

Which actually brings me to my third point, which is that millennials can be much more particular about what we want in a car. To many of us, the substantial financial outlay of a car is not only a means of transportation, but an extension of our personal brands. That means that it needs to not only match our lifestyle needs, but also be adaptable to the style of each individual. As far as lifestyle needs, it may come as a surprise that not everyone wants a small car-based crossover with a raised seating position and lots of places to stash discarded toys while sacrificing fuel economy for that one time a year when the car might see some inclement conditions. The variety of vehicles offered at reasonable prices that can meet all of the various criteria is simply too limited. And those handful of vehicles that do manage to meet a majority of the lifestyle criteria simply offer too few options in color, wheel, and design choices to meet the personalization needs of millennials. While I realize that having so much variation on hand is nearly impossible to do for a dealer, it certainly makes the case stronger for a direct sales model that allows the consumer to build the car that they desire.

And, finally, the advertising that is supposedly geared towards the younger generation is oftentimes downright awful. I cannot even count the number of times I have cringed at car ads that I know were intended to appeal to my age group. Some of these ads depict random acts of stupidity or are so completely nonsensical and unfunny that they not only fail at piquing my interest in the product, but might actually turn me off towards the brand. Every automaker is looking for that next viral ad that generates millions of YouTube hits, but sometimes all you need for that is a brilliantly touching or ingeniously genuine spot instead of the contrived messes that are being served up now.

What makes the millennial generation different from generations of the past is that our individuality makes it more difficult to lump us together into large groups that can be wrapped in a singular profile around which to build a product such as a car. Instead of trying to force existing models on a new generation of buyers, automakers would do themselves a world of favors to take the time to understand the diverse nature of the group and remodel the entire car-buying experience to actually fit that diversity. They also need to recalibrate their expectations around millennial buyers and understand that many of us are more discerning than ever. This is not a bad thing for the marketplace so long as the automakers are actually listening.

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