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Millennials: The Downfall or Catalyst for Change in Automotive?

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Today, millennials represent 32% of the automotive market shoppers, and by 2030, that number will increase to 50%. Soon, half of all automotive shoppers are folks who have depended on computers for most of their lives. Because of this huge shift, millennials are not likely to respond to the same marketing strategies used to target their parents. This generation lives in the digital space, so marketing must be adapted to shine and engage where the audience thrives.

Generic paid advertising fails to resonate with millennials, so OEMs need to reduce the amount of spend that is simply not moving the needle. Not only do customers spend most of their time on mobile – not desktops – but they also have become unresponsive to spammy sales messaging. Today, table stakes for OEMs are personalized messages that leverage customer data. I love it when some marketing agencies announce that they do paid advertising. Okay, that’s great, but what is the technology and data used in those efforts?

The shift does not stop at marketing, however. The automotive industry has already been experiencing the impact of this generational shift in the customer journey. Indeed, one of the most affected areas is the preference for digital-first experiences, such as shopping and buying online. These customers expect that shopping for an automobile will be as fast and convenient as any other purchase, which means they won’t want to go into a dealership to fill out paperwork or get approved for credit.

Of course, an entirely online buying experience is still in the future for most OEMs, but they’ll need to speed up quickly. Not having a great customer experience online will be a non-starter for millennials as they will demand virtual test drives, virtual assistants, credit approval through financial apps, and more. While parts of this buyer journey exist digitally, it remains siloed and disconnected. Ideally, the modern consumer desires a holistic, seamless journey in which they can build and price, reserve their vehicle, and place a deposit all online.

Many OEMs are setting up a Customer Data Platform to understand the customer journey and generate very specific messages to their customers. OEMs are generating experiences for consumers both online and at the dealership that are very different. Some OEMs are launching websites that let customers configure a vehicle to their exact specifications within 30 minutes. As part of the ordering process, they get a guaranteed price for the vehicle, and they can personalize financing.  Then customers can pick up their new vehicle at their local dealer showroom without spending much time inside.

Actual dealer visits could change too, such as with test drives enhanced with onboard computers that generate feedback and reports. To support the experience, the dealer staff would have deep knowledge of all the models and the vehicle technology. Further, they could also streamline purchases to make the experience more frictionless and customer-friendly.

Alongside the buyer journey is a trend that is completely upending the way the automotive industry is going to market. Millennial’s view vehicle ownership very differently than past generations.  Automobiles for millennials are not necessities. Many millennials are interested in ridesharing and subscriptions that allow them to use different vehicles as their needs change. They are expecting services and features that are on-demand and pay-as-you-go.

Our team at Perficient has been creating experiences for OEMs such as virtual assistants, virtual test drives, and unified commerce shopping experiences that are directly related to customer experiences. This translates to experiences that customers want and makes it easier for them to transact with the OEMs. What we have found is that these types of customer experiences not only drive engagement but also drive conversion.  Overall, we find that OEMs should lessen their generic advertising budgets, offer more personalized and customer-specific messages for the lifetime customer journey, and recreate loyalty to be more of a membership with the OEMs.

Tap into Perficient’s automotive expertise to begin transforming the automotive customer experience.





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Keith Tomatore

A long-time senior executive in the auto industry who has held the position of SVP, Retail Marketing at Global Team Blue (GTB, a WPP Company) on the Ford Retail Business. In this role, Keith worked with the Ford Dealer Associations across the country to help them with their Precision Marketing and digital efforts. Also, he served as CEO of iFrog Marketing Solutions, which focused on Automotive advertising solutions for Tier 2 and Tier 3.

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