Millennials and Cars: How to best engage young car buyers

Keep in mind these factors when marketing and selling to millennial car buyers.

As the Millennial generation—those born between 1981–1996—gets older, starts families and shifts to more affordable housing in suburbia, they too are following earlier generations into car ownership.

However, there is little doubt that there are economic, social and technological influences on this generation that mean that they don’t quite think or behave like the generations preceding them.

Senior Commercial Analyst at carsales, Kane Hocking, outlines a few factors that dealers should keep in mind when marketing and selling to millennial car buyers. 

1. Social Media

“As the first generation to grow side-by-side with social media, millennials are highly influenced by what they see posted online by friends, celebrities, influencers and people they’ve never met,” explains Hocking. “And online posts are dedicated to showing the best and most premium products, services and customer experiences. Anything less than that standard hurts social standing.”

A recent study by Allianz Life in the US revealed that 57% of millennials spent money on something they hadn’t planned to because of what they saw online.1

“Millennials are diverting spend to products and services that boost their social standing amongst peers—best evidenced by the explosion of luxury sneakers and upgrading to premium products such as Gold Class cinema and premium airline seating. 

“In the car space, this is reflected in the growth in prestige sales in recent years. The share of prestige and luxury brand new cars sales nearly doubled in Australia between 2012 and 2018, growing from 6.5% to 11%, or around 60,000 cars.2

“The challenge is to build this experiential element and emotion into the car purchase—and not just across premium price points. “It’s important to keep in mind that there is an aspirational vehicle for millennials at every price point. The success of cars such as the Mazda3 and Fiat 500 with private buyers is a testament to this.”

2. Big Debt and New Expenses

According to GM’s global design boss Mike Simcoe; it’s not the cars themselves, but their prices, that may impact car ownership.

“Value for money in terms of specs and features has never been better for new cars. However record levels of student debt in the US, higher utility and insurance costs and casualisation of labour, have pushed the new car purchase down the priority list," says Hocking.

“Smartphone costs are also higher than ever – not to mention there are new ‘must-haves’ such as Netflix.

“A lot of the millennial lifestyle has been funded via Alternative Payment Lenders which have burst on to the scene in recent years. These firms are not regulated as a credit provider for the purposes of the National Credit Consumer Protection Act 2009 (Cth), allowing them to capitalise on the need for immediate gratification.”

3. Frictionless transacting

The Deloitte University Press study ‘The changing nature of mobility’ found that millennial drivers value the customer experience three times as much as vehicle design.1

“The customer experience that a millennial expects from a brick and mortar retailer is the same frictionless transaction they’re accustomed to from pure online retailers—easy, fast and transparent.”

”Of course, we all know that car buying —as the second-highest value purchase that most of us will make—can be complex and intimidating for many. 

See and Touch will always be a critical element of an emotional purchase, but the best customer experiences will seamlessly align the online experience with the showroom—to grow conversion and retention.

On carsales, buyer satisfaction with dealers—measured by Average Dealer Ratings—increases as the respondent’s age rises.2

“Multiple long paper forms and drawn-out negotiation is not how this generation is accustomed to transacting.” 

Tips to better engage millennials

1. Photos and videos that stimulate emotion

Instagram and Facebook have conditioned millennial buyers to high-quality photos that elicit an emotional response. This makes listing photography as critical as ever. A vehicle can become an aspirational or premium choice for a millennial when photos present it in the best light. In an Australian automotive classifieds first, dealers are also now empowered to upload video to their listings on, bringing to life exterior and interior features, sounds and condition, and building greater excitement and emotion. 

2. SMS instead of dialling

Many millennial buyers will prefer interacting with your business through SMS or instant messaging—as opposed to the traditional phone call—as interacting and negotiating via these channels can be a less daunting experience. SMS enquiries should be treated as seriously as phone and email, and buyers that enquire via this channel will expect an even faster response. 

3. Fair deal pricing

Upfront, ‘fair deal pricing’ with little to no room for negotiation, aligns with how millennials want to buy a car. 35% of millennials say trying to negotiate makes them stressed, while 45% of millennials would prefer to avoid it entirely.1

4. Transparent borrowing 

The changes to flex commission rules give rise to an opportunity to increase rate transparency. This, in turn, may help increase finance penetration rates. Notably, the volume of new cars finance at Australian dealers is less than half of that in the U.S. and as such, dealers are encouraged to widely advertise transparent and easy-to-understand finance rates.

This article originally appeared in Edition 15 carsales Auto Market Watch



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1. Generations Ahead Study, Allianz Life Insurance Company of North America, February 2018.
2. FCAI VFACTS, 2012–2018
4. carsales internal data, January 2017–June 2018. Age of respondent when asked to rate dealer experience at dealership out of 10.
5. Why millennials say they avoid negotiating published March 22, 2019,