Some Millenials Are Finally in the Market in Respectable Numbers
|   Wednesday, August 27, 2014
Even as much of GenY is still holding off purchasing its first car due to the huge debt load that it is carrying from college, some older GenY members have made it to the point where they are in the market.

AutoTrader researchers point out that GenY spans the years from 1977 to 1994. They also have pointed out that most of the younger GenY members – those aged 19 to 27 or 28 – have put off their buying decisions due to the debt load they carry from college, the fact that they live in cities where cars are not a huge necessity and they don't earn enough to buy a car in the first place, while older members of the GenY generation from about 29 to 34, are at a place where they can buy their first car.


These members of GenY are in higher-paying jobs, usually have families and homes in the suburbs and need a vehicle to get around. GenY buyers now make up 26 percent of car buyers, while their Boomer parents are still the market leader at 40 percent. The increasing penetration of GenY buyers into the car market is likely to continue.

According to JD Powers, automotive market research firm, this is just the start of a new wave of buyers in the market.

"As GenY consumers enter new life stages, earn higher incomes and grow their families, their ability and desire to acquire new vehicles is increasing," according to Tom King, a JD power vice president.

GenY buyers also represent a new type of buyer that most traditional dealerships have not seen before and there is likely to be some friction between the new buyer and those steeped in the old marketing methods that pushed monthly payments as the key to making the sale or upselling a customer (putting them into a vehicle that cost more than the vehicle they had arrived to look at) as the GenY consumer will likely have done huge amounts of research online, using their smartphones and they come to the dealership oftentimes knowing more about the vehicles they are interested in than the salesman or sales manager.

It is at this point, where the salesperson does the "meet and greet," the introduction where the salesperson qualifies the customer and the type of vehicle he or she wants. Using this method, the salesman then goes to the sales manager who looks through the inventory, oftentimes for the vehicle with the best margin as he makes his living off the sales of his staff and tells his salesperson to show the customer that car and similar ones.

Today's GenY buyer will then, maybe just looking at the smartphone screen, indicate that today he or she wants to look at "this model for this price." Of course, the salesperson is knocked off-stride by this seemingly unconventional answer and he runs back to the sales manager, looking for guidance. The sales manager, almost always an elitist who believe he knows more than anyone else about what customers want, tells the salesperson to try harder and he goes back out of the office pushing the cars he chose.

At this point, the GenY buyer will likely be getting hotter and hotter under the collar and may just walk because the dealer was intransigent. Of course, the sales manager never blames himself for missing the sale, he just pushes it off on the poor sales person who doesn't know how to sell. This person then has a target drawn squarely on his or her back and in the next major housecleaning (they happen about every 90 days) the salesperson is out the door, not the manager who just doesn't see the changes.

Those who see the changes will modify their sales procedures so that GenY buyers will get what they are looking for at the price they want. GenY buyers don't want to worry about monthly payments as they have their own bottom lines firmly established.

Indeed, many GenYers will also have their own pre-approved financing ready to go and will have already called their insurer or will go on line to esurance or GEICO to get a quote and establish their insurance right away.

There's a sea change coming in the auto market that is being led by GenY members who know what they want at the price they want and they won't play the dealership games, anymore.

PHOTO GALLERY
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