ACV facts & figures
Millennials and Gen Z have revolutionized the way we shop. Is your dealership ready? As with all generations, they gather information in unique ways and have their own priorities when selecting a vehicle. But these two younger segments of the market also have some unique habits and features. Since these two generations make up a large portion of the current and upcoming markets, it’s important for dealers to understand what they want and expect from their car shopping experience. This way, you can more effectively advertise to them and adjust your customer service to reach savvy new buyers.
Who Are the Millennials?
Millennials are the generation born between the early 1980s and mid-1990s. They make up the largest portion of the automotive market¹ because they’re starting families and moving further away from dense urban areas with easily accessible public transportation. In order to provide millennials with the information they need to increase their confidence in a purchase, you’ll need to understand how they shop.
What Makes Millennial Car Buyers Different?
First and foremost, millennials grew up with an unprecedented amount of technology due to the development and mass adoption of cellphones and the modern internet. Readily available technology makes it easier for them to comparison shop—and 71% of millennial buyers will spend a significant amount of time weighing their options². They research specifications on car maker sites, as well as third-party websites and forums, and consult text and video reviews to narrow down the pros and cons of various vehicles¹. Additionally, they’ll use search engines to compare vehicles’ safety ratings, pricing, and optional features.
Despite this generation’s close relationship to many different forms of media, they’re less likely to respond to traditional advertising. First-hand accounts and user-generated content about positive or negative experiences with a vehicle have a bigger impact on buyer behavior than highly produced TV commercials¹. Encouraging customers to submit reviews and share their stories on social media can be a far more effective way of reaching potential millennial customers.
Ultimately, this reliance on research makes millennials less likely to visit dealerships in person as part of their shopping process. Instead, they come in with information and preferences ahead of time, ready to test drive specific vehicles rather than discover them onsite. They’re also more likely to be familiar with their financing options³.
Given their extensive experience with the internet, millennials are much more comfortable ordering vehicles online, whether it’s through a virtual platform that sells and delivers vehicles without test driving or pre-ordering a new vehicle directly from the manufacturer. A positive, innovative test-driving experience can entice millennial buyers to visit a dealership¹, increasing the chances they’ll see cars in person that they wouldn’t be able to find online—including used vehicles.
Who Is Gen Z?
Gen Z is made up of buyers born in the late 1990s to early 2010s, and they have their own unique preferences. While they are the newest customers in the car market, they currently make up 25% of the population⁵ and represent a significant portion of buyers, making it vital to prepare for new customers. Despite being known as the first truly digital native generation, since they’ve always grown up with cellphones and the internet, some of Gen Z’s car buying preferences may surprise you.
What Makes Gen Z Unique as Consumers?
Like millennials, Gen Z spends a lot of time online and prefers YouTube and social media to other types of websites¹. However, when it comes to the car purchasing experience, this generation prefers face-to-face interactions and is more sold on a positive, supportive experience at the dealership rather than a hard sell⁵. They also value input from friends and family nearly as much as testimonials and reviews found online.
Differences in Gen Z preferences aren’t just about where they’re getting vehicle information or their in-person customer experience. For example, this generation ranks price and safety higher in priority than millennials, who tend to look at style and tech features⁴. Gen Z’s focus on price may be a result of growing up in times of economic instability and more open conversations about generational wealth. They may be more inclined to consider a used vehicle for a balance of quality and price. Similarly, their emphasis on safety may be a result of increasing amounts of information about the hazards of distracted driving.
Increased awareness of safety has also made Gen Z interested in autonomous driving features. Additionally, Gen Z is likely to care about owning a vehicle that minimizes their environmental impact, which opens them up to being interested in new and developing technologies, such as electric vehicles⁴.
How Can Used Car Dealers Reach Younger Buyers?
So, what does all this mean for car dealerships? For one thing, social media and data-based advertising should be integral parts of your marketing strategy. Vehicle information, user reviews, and comparison tools designed for your desktop and mobile browsers and social media apps are all valuable to younger buyers during their research process.
Understanding trends in generational preferences and individual consumers’ historical data can also help you develop and target ads and web content. Use this information to decide which features are likely to appeal to particular buyers. For millennials, you may want to highlight mobile device integration for music and GPS navigation. To reach Gen Z, focus on your team’s customer service skills and knowledge of greener, more efficient technologies. Above all, be positive, informative, and genuine to convert that online researcher to an in-person customer.
Find the Features Younger Used Car Buyers Want
Generating interest is crucial to reaching younger buyers, regardless of their age group. Now that you know what millennials and Gen Z customers are looking for, you’re prepared to pivot your stock and sales strategy to stay ahead of the evolving automotive market. ACV Auctions’ detailed vehicle and market reports will give you a head start in generating vehicle descriptions and comparisons that will entice your youngest customers. Join today to build your dealership’s used car inventory.
1. Tsao, S. (7 September 2021). From Customer Data: Millennial Car Buying Trends. Treasure Data blog. Retrieved November 4, 2022, from https://blog.treasuredata.com/blog/2021/02/26/how-millennials-and-customer-data-are-changing-the-car-buying-experience/
2. Millennial Car Shoppers Are Ready to Buy – What Your Dealership Needs to Know. V12data.com. Retrieved November 4, 2022 from https://v12data.com/blog/millennial-car-shoppers-are-ready-buy-what-your-dealership-needs-know/
3. What Are Millennials Looking for in Their Cars? Cyberleadinc.com. Retrieved November 4, 2022 from https://www.cyberleadinc.com/blog/millennials-looking-cars/
4. What You Need to Know About Gen Z and Why It Matters. Cox Automotive, Inc. Retrieved November 4, 2022 from https://www.coxautoinc.com/wp-content/uploads/2017/08/2016GenZStudyFINAL.pdf
5. Johnson, B. (23 August 2022). 4 Things Gen Z Hates About the Car Buying Experience. Inspira Marketing. Retrieved November 2, 2022 from https://inspiramarketing.com/4-things-gen-z-hates-about-the-car-buying-experience/
Aug 30, 2023