Are Millennials Buying Cars? How are Apps & Technology Affecting Car Sales08/29/2017 03:53 pm | Posted by Admin
Driving a car is slowly becoming a thing of the past. More and more millennials value convenience and time over freedom of owning a vehicle. Gridlock, social status and technology all play a role in this changing automotive climate.
The millennial generation are those born in 1982 and approximately the 20 years thereafter and they’re especially willing to forego an automobile in favor of public transportation and ride sharing services like Uber / Lyft. Yet, it’s not say millennials are anti-car altogether; sure it’s cool to save the environment, but the truth is they simply lack the money necessary to make such a significant purchase.
..But Will Millennials Ever Buy Automobiles?
The millennial age cohort is now the largest in America, having surpassed the Baby Boomers in recent years. Though many of these youngsters are hesitant to plunk down the money required to buy or lease a vehicle, it won't be long until they have the discretionary income necessary to do so. This is not to say every single millennial will shell out the money necessary to acquire a brand new automobile. Rather, millennials are quite hesitant to part ways with their money as they witnessed the economic meltdown of 2008 and have endured quite the struggle to find employment that pays a living wage.
Indeed, some millennials will continue to rely on Uber-like ride sharing services, public transportation and friends for rides. However majority are still open to the idea of buying an automobile and all that’s attributed with the ownership, primarily freedom and status. Here's how the industry can get millennials to pull the trigger.
..And How Do Dealerships Sell to Millennials?
In the era of smartphones and apps millennials crave transparency, especially in the context of financing. They desire a completion of the loan process at the top of the funnel oppose to the traditional method of financing of the brick and mortar dealership. Millennials are too busy tweeting, reading reviews and researching their vehicle to deal with dealership's finance and insurance department at the funnel bottom. It is yet another example of how millennials respond to on-demand services that do not require a significant investment of time or effort.
There is a new wave of apps targeting this highly coveted age cohort and online apps like AutoGravity are leading the way. This helpful app lets auto shoppers secure financing for a new or pre-owned automobile from a smartphone, tablet or other web-connected device. All the customer has to do is fill out a few information fields, choose the vehicle for financing and analyze the financing offers. AutoGravity empowers shoppers to compare upwards of four auto financing options from the comfort of home. This is perfect for millennials who are looking for immediate information and often prefer to avoid human interaction.
Armed with information, a millennial who knows details of the auto loan upfront will be more inclined to visit the dealership for a test drive. This experience is a sharp contrast to the traditional auto-buying route of visiting a dealership. With endless browsing of cars in-person, enduring sales pitches, performing test drives and filling out paperwork with the finance and insurance (F&I) department, one will inevitably feel disappointed they didn’t get a bargain or worst qualify for financing.
..And What Can Auto Dealerships Do to Court Millennials?
Consider the following statistic: 10,000 Baby Boomers enter retirement each day. This trend will likely continue for at least another decade. As these boomers retire, their millennial “boomerang” offspring will enjoy considerable employment opportunities. This is precisely why the millennial age cohort is the most coveted. Secure their business now, meet them at their online venues, treat them right and they just might be loyal to your dealership across posterity.
Respect the fact that millennials demand complete transparency during the sale process. Value their efforts and research and understand they don't appreciate a strong, pressure-packed sales push or a drawn-out process for automobile financing.
Be honest with millennial auto shoppers, stay up-to-date with the latest technology and make sure your website is highly polished. Do not force these prospective buyers to pass through the entire sales funnel only to find they can't obtain favorable financing terms from your dealership. Get that roadblock out of the way at the top of the sales funnel and your millennial shoppers will hold your dealership in high regard.