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Dealer Insights - March/April 2014 - How to Market and Sell Vehicles to Millennials

Feb 25, 2014

Dealerships face a number of different challenges today, and one of the biggest is selling vehicles to young car buyers. This includes the Millennial generation, which is loosely defined as those born between 1980 and 2000.

Unfortunately for dealerships, this population segment of approximately 75 million people doesn’t generally show a strong interest in buying automobiles. In 2012, only 13% of new vehicles in the United States were bought by those between the ages of 18 and 34, according to a joint study conducted by J.D. Power and Associates and AARP. In 2001, this age group bought 24% of new vehicles in the nation. What’s more, only two-thirds of 16–24-year-olds even have a driver’s license, the lowest rate in 50 years.

Experts attribute these trends to several factors, including the ongoing sluggish economy, which is keeping young buyers out of new-car showrooms, according to a new analysis by Edmunds. Also, many Millennials live (or want to live) in urban areas and don’t feel they need a vehicle, not to mention the high cost of buying and owning a car today.

Reputation vs. reality 

The common Millennial reputation is one of cash-strapped, college-debt-saddled 20-somethings living in Mom and Dad’s basement. But the reality is that Millennials tend to be highly educated and influential consumers with an estimated $172 billion in aggregate spending power.

Millennials make up 40% of the U.S. car-buying population today — and this is expected to rise to 50% by 2020. So, it would be wise to consider ways to connect with members of the Millennial generation to draw them into your dealership, gain their trust and cultivate long-term relationships with them once they buy. Following are three suggestions to get you started:

  1. Know what they want to buy. Most Millennials are looking for affordable, environmentally friendly vehicles with exceptional gas mileage, sleek designs and high-tech features. In general, they aren’t as interested in raw engine horsepower and torque as previous generations were.

    In a survey conducted by Deloitte, 59% of Millennials ages 19 to 31 said they preferred an “electrified vehicle.” About 57% said they favor hybrid gasoline-electric vehicles over pure battery electric vehicles or vehicles with a traditional gasoline-only power train.

    Millennials also are looking for vehicles that are an extension of their social media and digital lifestyles, the Deloitte survey found. Touch-screen interfaces (73%), smartphone applications (72%) and in-dash technology (59%) are among the features they listed as most desirable.
  2. Communicate in their language. When marketing to and communicating with Millennials, use the media they prefer. Not surprisingly, this primarily includes social media, the Internet and mobile communications.

    Mobile, in particular, is poised to be the dominant platform to reach Millennials for the foreseeable future. According to a study conducted by Morpace, a research and consulting company, and, Millennials used mobile phones during the car shopping process two-and-a-half times more frequently than did non-Millennials. They used mobile phones to get pricing, find classified listings, locate a dealer, look up specs and read reviews.
  3. Use effective selling techniques. While Millennials tend to be skeptical when it comes to being “sold” something, they rely more heavily on car salespeople than other demographics do. In a survey conducted by, about half (49%) of Millennials said they rely on the salesperson for vehicle information, compared to 41% of Gen X respondents and 38% of baby boomers.

    Keep in mind, though, that most Millennials will be well informed when they walk through your doors. They have likely already done research on vehicles they’re interested in via their tablets or mobile phones. So the best strategy with Millennials often is to use a low-key sales approach and position your dealership as a trusted resource that can help them make the best car-buying decision.

Cultivate long-term relationships 

Finally, remember that the day a Millennial drives off your lot shouldn’t be the end of a sale, but rather the beginning of a long-term relationship. Create a strategy — ideally, one that’s Web- or mobile-based — for regularly staying in touch with Millennial buyers and keeping your dealership top-of-mind with them.

By following these and other strategies, you may be able to land Millennials as loyal, lifetime customers — and reap the rewards of these long-term relationships for many years to come.

Sidebar: It’s not just a car 

Last August, published a comprehensive Next Generation Car Buyer Study that took an in-depth look at Millennials’ attitudes toward buying automobiles. Nearly half of Millennials (48%) said it’s important that their cars represent their personalities, while more than a third (38%) said their cars should represent their accomplishments.

In addition, more than two-thirds (70%) said “infotainment” features are must-haves in their cars. These include:

  • Navigation (46%),
  • MP3 player (41%),
  • Satellite radio (32%),
  • Bluetooth (23%), and
  • Mobile integration (22%).

One of the main takeaways from the study was the fact that, for Millennials, a car isn’t simply a way to get from point A to B. “Millennials place great value on individuality and personal expression,” the report stated. “They view their car as a means to tell the world who they are.”

Dealer Insights - March/April 2014

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