A 2012 article titled ‘The Cheapest Generation’ established an urban myth that is still widely believed to this day; that millennials don’t like cars. This was considered by some to be a fall out from the 2007 global economic crash. However Derek Thompson and Jordan Weissmann, authors of the piece, stated that “millennials’ aversion to car-buying isn’t just a temporary side effect of the recession, but part of a permanent generational shift in tastes and spending habits.”
This set off a frenzy of speculation that a permanent behavioral shift was underway, and that millennials would set off a trend of “de-ownership”. In some ways this is true, millennials are certainly waiting until later in life before buying cars. However, in reality millennials are just as car mad as older generations and social media is playing a huge part in the way we view cars, the way we buy cars and the way manufacturers sell us cars.
Thompson and Weissmann were right about one thing though – young people’s relationship with cars is completely different to their parents generation, and the automotive industry has changed as a result.
Accessories are more important
Research by OEM Solutions found that image is more important to millennials than older generations, and the type of car you own is a big part of that. When people buy a car, and the accessories that can accompany the vehicle, they often decide to show off their purchase on social media.
32% of millennials like to impress people with their lifestyle, and 40% like to show off their taste. OEM Solutions also found that millennials are also more likely to be tech-aware and use social media to show their lifestyle.
Why? Because how your car looks is becoming more important, crossing over the blurred line between essential product and luxury. Cars need to be practical, but they also need to look good. This in turn has meant that people are more likely to spend more on accessories for their cars, such as personalised number plates, custom wheels and sound systems.
However, it’s not just about the image of a car. Manufactures are also having to make vehicles more tech savvy. Millennials are more digitally demanding than previous generations. Baby boomers were fine with a radio; millennials want full smartphone functionality. According to OEM Solutions, the top 5 features millennials desire when buying cars are navigation systems, satellite radio, bluetooth, MP3 players and mobile integration.
Car buying is going social
Social media has played a huge role in millennials’ relationship with cars. According to the same research by Eventbrite, 7 out of 10 millennials experience FOMO, or the fear of missing out. They state that “in a world where newsfeeds and social media broadcast what friends are experiencing, the fear of missing out propels millennials to show up, share and engage.”
This is no different in the car buying industry. Instagram pages dedicated to cars enjoy millions of followers. A social media account, Rich Kids of Greece, recently made headlines as the aforementioned rich kids post pictures of, among other luxury items, sports cars to show off their lavish lifestyle.
Millennials look at, talk about and research cars as much as older generations, however they are much more likely to do so online.
This move to internet car shopping has even been hailed as the beginning of the end for car dealerships. Millennials’ influence with technology usage has turned the car-buying process upside down and will likely continue to do so, as millennials are beginning to officially outnumber baby boomers.
Experience is valued over ownership
Millennials may be image conscious, but that doesn’t mean they’re particularly interested in ownership. Research by Eventbrite found millennials are more likely to crave experiences over possessions. 3 in 4 millennials (78%) would choose to spend money on a desirable experience or event over buying something desirable.
This doesn’t necessarily mean car buying is going to suffer. What it does mean is that car manufacturers must make the experience of a car more enjoyable, or at least use what is termed as ‘pull’ marketing. Car advertisements must emphasize the experience of driving with experiential campaigns, car clubs, and customised features. All of which provide a satisfying user experience.