Remember how, less than a decade earlier, as the car industry struggled to recover from the Great Recession, millennials were the industry’s worst nightmare? Many people at the time were uninterested in obtaining a driver’s license or owning a vehicle, while ride-sharing and auto mechanic businesses were developing to fulfill their requirements without burdening themselves with more debt. Millennials are now the single biggest group in the automobile industry, and they are projected to drive a vehicle ownership bonanza in 2021.
While much has been made of this generation’s penchant for deviating from the norm, they’re remarkably similar to everyone else regarding what motivates millennials to buy automobiles. As they start new households, more than half will move to the suburbs, necessitating automobiles. And they hold the same fundamental ideas that have always motivated individuals to purchase new vehicles: cars are a need, your car choice improves your image, and research is critical. The COVID-19 pandemic may also be reviving interest in vehicle ownership since many people are hesitant to maintain social distance when using public transit.
As per consumer data research, millennials couldn’t have been more different regarding how they are shopping for cars—and what they’re searching for in a vehicle. They have entirely new expectations, which research indicates are becoming more prevalent among vehicle purchasers of all generations, from Gen X to Gen Z. Millennials are paving the way for the future of automobile purchasing. And astute marketing would do well to take note.
The Role of Social Media
Millennials, more than earlier generations, are knowledge searchers who are ready to put in the time to study their choices and make informed judgments. Today, 88 percent of vehicle purchasers begin their search online, a tendency that all customers share. They are also more influenced by their findings: 56% believe their automobile research significantly affects 50% of typical consumers. Remarkably, all of this research is expected to be conducted on mobile devices.
They, like the majority of 35-year-old buyers, look up specifications and visit dealer websites. Millennials, on the other hand, utilize much more technological sources of information. They are attracted to tools for pricing comparison, financing, warranty assessments, and automobile configurations and films that show features, customer self-reports, road tests, and automobile interior/exterior overviews. With YouTube already being the most prominent streaming channel for Generation Z, this tendency is only expected to grow.
Conventional Advertising Is Often Disregarded
Scott Galloway, professor of marketing at New York University Stern School of Business, said during a presentation at L2’s Digital Leadership Academy that customers increasingly connect a lack of originality with automobile companies that invest the most in advertising. Manufacturers such as Tesla Motors, a cutting-edge company that effectively debuted with no conventional promotion, encourage this prejudice. Notably, traditional advertising techniques are generally unsuccessful when it comes to reaching the majority of millennials. A generation prefers to seek feedback and guidance from their social media contacts, seeing them as more reliable information sources than flashy advertising.
They are also heavily impacted by customer feedback. Indeed, millennials are more affected by user-generated information than previous generations, with 84% reporting that evaluations on business websites have at least some effect. The remainder of the consumers isn’t far behind, with 70 percent more influenced by reviews than advertising (so keep this in mind when purchasing ads!).
The Popularity of All-electric Vehicles (EVs)
Growing customer interest in electric cars, like SUVs, has been widely chronicled in recent years due to a seemingly infinite number of reasons. However, IHS Markit predicted that consumer adoption would reach new heights in 2020, with EV loyalty rising to 55 percent, up from 34 percent five years ago.
In a previous blog post, Stanton noted that dealers’ views about selling and servicing EVs had shifted significantly in recent years, citing Cadillac as an example of a dealership welcoming progress. According to Stanton, dealerships will be essential to universal digitalization because they provide a vast, expanding network of merchants and network operators who are specialists at marketing locally and engaged in the future sales and support possibilities that these goods promise.
Nobody wants to be left in the dust. That is why advertisers are so keen to target millennials: they want to understand what changes are taking place and plan for what comes next. While millennials are unquestionably paving the way for the future of vehicle purchasing, their behaviors aren’t limited to a single generation. Instead, they reflect broader societal trends as technology drives significant transformation across the retail sector. Disruptive automotive companies of the future are capitalizing on these developments by developing an entirely new marketing strategy driven by consumer data.