Automotive, Industry Ideas, Insights

Don’t Worry About Millennials — Here’s How to Win Over Gen Z

By Andrew Tai - Nov 18, 2019

Millennials aren't who you think they are

Selling to millennials isn’t your problem. You’ve heard all about how millennials are killing the car industry (and the restaurant industry, and the paper towel industry, and…), but studies show that millennials now buy cars as enthusiastically as their parents did.1 We’re not in the clear yet, though. There’s bigger problem on the rise.

You probably haven’t heard much about "Gen Z," but the generation at the end of the alphabet is the real challenge. They grew up with the internet; they live on the internet (even more than millennials); and the internet defines how they interact with the world – including how they view the automotive industry. They’re who you need to focus on.

Who is Gen Z?

You keep hearing about millennials as “the digital generation,” but millennials are older than you might think; in reality, Gen Z are the true children of the internet. Where millennials were born between 1981 and 1996,2 Gen Z are “internet natives” born in 1997 and later.3 Millennials adapted to the internet; Gen Z was born into it. millennials-vs-gen-z This makes Gen Z a very different customer. According to Forbes,4 Gen Z prefers “direct autonomy and control in decision making,” and “does not like being ‘sold to.’” They make their decisions "based on peer reviews, product information, and retailer ratings." In other words, they make their decisions online, away from salespeople.

If the traditional dealership wants to have a role in Gen Z’s future, then it’s time to change the way we approach this young audience. Taxis are losing to Lyft and Uber not because of price or service quality, but because people won't phone a taxi company or hail a cab when they can order a ride-share from an app. Dealerships need to take a hint.

Forbes5 reports that Gen Z is “technologically savvy, switching easily between multiple platforms, across smartphones, TVs, laptops, and tablets to exchange information, conduct transactions, or communicate.” Basically, they want everything to be omni-channel.

Become competitive through digital retailing

Omni-channel digital retailing is about more than lead forms and pricing widgets. To court the next generation of consumers, the car buying experience has to offer the same cross-platform convenience as Uber or Foodora. This starts with a digital retailing platform – one that makes it easy to start online and transfer intuitively to the showroom.

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It might not seem like it, but there’s a lot riding on the next few years. Gen Z simply isn't interested in cars the way previous generations have been. Economic adversity limited and delayed the car purchasing power of millennials, but the interest was always there. Gen Z fundamentally lacks the car-buying proclivity of their predecessors.

It's partly circumstance. Environmentalism and urban congestion have tempered Gen Z excitement about car ownership. Even necessity has diminished: with options ranging from rentals (U-Haul) to car shares (Zipcar) to ride-share apps (Uber), young consumers simply don’t have a compelling reason to lease or own. Add the headache of a traditional car purchase, and can you blame Gen Z for rejecting ownership?

Learn from the best

We need to emulate our competition. Gen Z chooses the familiar and convenient, and right now that means the likes of Uber. By comparison, car buying is complicated and counterintuitive, especially for a generation who expects to navigate transactions online. Gen Z doesn't care as much about the product as they do about the experience. That's what we need to fix.

If dealerships want to win over this generation, it's time to offer the convenience Gen Z demands by leveraging omni-channel digital retailing to the fullest. By giving Gen Z a digital way to buy a car, you can level the playing field. It's time to make ownership a real option for a generation who isn’t currently considering it. Let's win Gen Z.


Andrew Tai is the CEO and co-founder of Motoinsight, but his influence extends far beyond the company. A contributing columnist to The Globe and Mail and a prolific speaker, Andrew is a recognized authority on digital retailing within the automotive industry. Connect with him today to learn how your dealership is going to change, or see the future yourself at motoinsight.com.

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1https://www.chicagotribune.com/autos/sc-millennial-car-buyers-autos-0317-20160309-story.html
2https://worldin2019.economist.com/millennialsvboomers
3https://www.pewresearch.org/fact-tank/2019/01/17/where-millennials-end-and-generation-z-begins/
4,5https://www.forbes.com/sites/sarwantsingh/2019/04/09/car-companies-get-thinking-out-of-the-box-for-gen-z/#4d72a7205de0
6https://www.bloomberg.com/news/articles/2018-08-20/gen-z-to-outnumber-millennials-within-a-year-demographic-trends

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