Rumours abound about the car-buying preferences of millennials.
Some research shows that millennials value access over ownership and that they rely more on public transit and ride-sharing than the generations that came before them. But that doesn’t mean all hope is lost for the auto industry. In a recent study by CDK Global — which provides digital-marketing support to automotive retailers—80 percent of millennials said they plan on buying a car or truck in the next five years. A separate report from Autotrader indicates that, over the next decade, millennials will buy 40 percent of all new vehicles sold.
So instead of worrying about whether this generation wants to buy a new car, we’ll focus on what they want out of them.
The CDK Global study states that millennials spend more than 17 hours shopping for cars online, before they even head to the first dealership. The top sources of their research? By far, the category of sites they visit the most (with 82%) is third-party ratings and review sites.
Indeed, this generation relies heavily on their peers when making car purchasing decisions. According to Pew Research, 46% of millennials rely on word-of-mouth when making purchases, and 41% read customer reviews weekly (vs. only 25% of Baby Boomers). With this generation turning to Facebook, Twitter, YouTube and review sites for help in decision-making, it is increasingly important that they have access to current and accurate information, and for car companies to be a participant in the conversations.
Affordability and value
The major stumbling block to buying a new vehicle for a lot of millennials is simply money. Indeed, according to CDK Global, “The top reasons millennials say they don’t own a car are purchase and maintenance costs.” The challenge for automotive marketing professionals is that these younger buyers also demand high levels of technology and expressive design—which doesn’t always come cheap. And according to a recent Reevoo study, of those millennials that do own cars, many aren’t willing to change their lifestyles to afford more expensive or newer models. Yet by keeping those factors in mind, you can fine-tune your approach to balance those needs.
Nav is a must-have
Navigation is the No. 1 most desired feature for millennial car shoppers, according to the Autotrader report, and there was a time when such technology would have been out of their price range. Today, nearly all brands can point out less-expensive cars that can be ordered with integrated navigation systems. And a number of automakers also have launched some high-value solutions.
The compact Toyota Corolla, among others, supports the Scout GPS Link app for nav service, leveraging the owner’s compatible smartphone. It’s part of the Corolla’s comprehensive Entune Audio multimedia bundle, which has an MSRP of $675. Meanwhile, adding integrated navigation to the Corolla would cost thousands of dollars.
Calling on technology for smartphone integration
The navigation app is merely the tip of the ol’ iceberg when it comes to relying on smartphones for in-vehicle infotainment. Nearly all automakers furnish connectivity systems, even for their affordably priced vehicles. These then provide millennials with app interfaces for audio (like Pandora and iHeartRadio), social-media platforms (including Facebook and Twitter), and more.
— CarPlay Life (@CarPlayLife) December 19, 2016
Some models of the newest trucks and cars, like the Honda Civic, are taking that approach to its logical conclusion with Android Auto and Apple CarPlay. This smartphone-integration technology lets owners essentially convert their cars’ infotainment displays into remote homepages for their compatible smartphones—for easy on-the-go control over most phone functions and an excellent marketing advantage.
Going mobile with wi-fi
Actual mobile Wi-Fi service, with 4G LTE connectivity, is another automotive technology that’s sure to attract millennials, and although its availability is limited in the mainstream marketplace, its unlimited potential makes it worth mentioning. The Chevy marketing team, for example, could do well by highlighting that technology on its more wallet-friendly cars and crossovers. Entries from the Chevy Sonic to the Chevy Trax supply 4G LTE mobile Wi-Fi hotspots as standard features, backed by complementary data plans for three months/three gigabytes of use.
Fueling millennials’ interests
Finally, since millennials make it a high priority to reduce fuel costs, steering them toward high-efficiency vehicles makes sense as well. And remember, those aren’t limited to hybrids and EVs. Beyond perennially popular choices like the Toyota Prius—rated at 52 mpg combined—or the Nissan LEAF, with a post-tax-credit cost as low as $21,510, some companies are showcasing a new generation of turbocharged mini-engines for their smaller cars. The Ford Fiesta, for one, offers a 1.0-liter, three-cylinder EcoBoost unit that can achieve 31 mpg city/43 mpg highway/36 mpg combined.
Think of the boost that kind of claim could give your marketing.