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Madison Gross

Madison Gross Director, Consumer Insights

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What sets Millennials apart: understanding and engaging this growing generation of car shoppers

Millennials, the people born between 1981 and 1996, are set to become the biggest population group in the country sometime this year. And they’re setting themselves up for future financial success—and for being able to buy a car when they need one. In fact, Millennials are expected to make up 40% of sales of all new cars by 2020.

As Millennials make up a growing segment of today’s car buyers, car dealers need to know what they care about and how they shop to be able to reach them throughout their shopping process.

We delved into Millennials’ car-buying habits in the CarGurus 2018 Buyer Insight Report. Here are the top three things we observed about how they compare to others in the auto market.

1. They're eager, engaged buyers

Millennials are more likely to say their purchase is urgent. In fact, 30% are purchasing very or extremely urgently. They’re also more likely to be purchasing due to a major life event. 

We can make some simple inferences here: as Millennials reach life milestones—landing a new job, moving to a new city, getting married, having kids—they often need to purchase their first car or a car with features to match their new lifestyle. And at this stage of life, these changes can come pretty quickly. 

Despite the urgency of the purchase, Millennials enjoy the car shopping process. Perhaps because they associate a car purchase with exciting life changes, they’re more likely than other groups to:

- Think car shopping is fun (21% higher than others) 

- Say they enjoy negotiating (31% higher than others)

2. They're always connected

Surprise, surprise: Millennial shoppers use technology to research cars and engage dealers. Compared to others who used digital resources when car shopping, Millennials are 20% more likely to use only digital resources. This consists of watching videos, looking for recommendations on social media, searching the web for digital resources as they shop, and more.

They’re also more likely to do each of these activities from a mobile device than a computer—Millennials are 32% more likely than other groups to do mostly mobile research. Even at the dealership, they’re using their mobile devices more than prior generations to fact check and compare information to what they saw online.

Millennials aren’t just using technology to do research though. They’re also using it to get in touch with dealers. Compared to other groups, Millennials are 40% less likely to visit a dealership in person without contacting the dealer in advance. And when they do reach out, it’s via the internet. Millennials are:

- 45% more likely to reach out to a dealer via a listing or research website

- 35% more likely to make contact via a brand website

3. They think they’re certain, but later change their minds

Millennials’ minds aren’t always made up from the beginning. From buying or leasing, dealership, type and make of vehicle, new or used, they’re more likely to change their minds about certain decisions than other groups. And while they’re doing plenty of research online, they also let feedback from peers influence them— Millennials are 30% more likely to rely on the opinions of friends and family when shopping for a car.

So how can you take these observations about Millennials into account in your business?

Don’t push them too hard

Millennial shoppers are excited about the prospect of buying a car. Keep their enthusiasm up, and avoid giving them the third degree when they first make contact. It’s unlikely you’ll sell a car on the first phone call. Instead, find out what they’re looking for when they first reach out, then use the time you have to prepare for their in-person visit.

Optimize your digital presence

Make sure you’re investing in your dealership’s online presence. This could mean improving your own website, diversifying your presence across third-party sites, and maintaining your presence and advertising on social media. Consider how you can use these platforms to reach more Millennials and to stay top of mind. With a larger digital presence, you also need to be prepared to handle web forms, emails, texts—and calls.

And it probably goes without saying, but, if your website isn't mobile-friendly and your inventory isn't available on platforms that attract lots of mobile users, you may be missing out on Millennial shoppers. With mobile internet use on the rise among car shoppers of all ages, your digital strategy must accommodate mobile.

Present options, propose alternatives

Millennials are more flexible at the beginning of their car buying journey—and they’re having a good time shopping. Start a discussion with them early in the process when they’re considering buying vs. leasing, new or used, type of vehicle, and which dealership they’ll buy from. Presenting options early on also gives them a chance to consult family and friends as they narrow their options. Don’t wait until they’re on your lot to start a conversation because chances are, they’ve already made up their mind at that point.

Millennials, uniquely, have an affinity for brands whose values match their own. In other words, identifying what Millennials value—and adapting accordingly—will help you attract their business.

For more information, read the full CarGurus 2018 Buyer Insight Report.

Mallory Hughes

Madison, this is a great post! I 100% agree that if a dealer does not have a reactive mobile site with high-speed load times and functional features, they will lose Millennials to a dealer that does. Millennials are by far the most educated consumers that this world has ever seen and they crave engaging content to learn about the vehicles they want to purchase! If your dealership is not catering to this new generation of car-buyers you will fall behind...

Mark Grabowski

Thank you for a great post Mallory. I have been watching this trend for the past six years and can confirm from the trenches that this information is credible for the most part. The CarGurus article matches up with a similar article I kept from Carsdotcom dated September of 2013, The Seven Digital Sins.

Be ready to react when a client reveals themselves to you. They are oftentimes 90% finished and simply want to move forward with a purchase. I was surprised to read only 6% prefer text to voice calls or emails. Remove the painful barriers and closing the sale is now easier than ever before. Just yesterday I sold and delivered a new car in just over an hour. We met through her initial email, then sent her a link to work her own deal, then she arrived already pre approved and ready to sign up on her lunch hour. Yes, on her lunch hour. They were Millennials. 

To combat attrition, remember to focus on the introduction to a service advisor during the client's visit either before or directly after contracting. I find that people want to feel like their salesperson actually cares and that they know who the service person will be when the time comes. The car sale is just the beginning of a client/dealer relationship, not the end. 

R. J. James

Madison... As my 7th-grade Industrial Arts Teacher used to say, "You can hit it hard, you can hit it a lot; but you won't drive it home unless you HIT the Nail on the Head!"  In this post you definitely DROVE-the-NAIL!!!  

Mark Grabowski

Madison, please excuse my careless error in addressing you as Mallory. All I can offer is my most sincere apology. 

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