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Auto Dealers: Top 5 Customer Service Tips to Sell to Millennials

Posted by Tom Lombardo | Tue, Aug 05, 2014 @ 10:00 AM

Selling to MillennialsMen of the Millennial Generation all have waxed moustaches and the women are all tattooed, as everyone knows, and they won’t buy cars until they’ve showroomed a dealership, maybe yours, and their parents finally throw them out of the room they’ve occupied since birth – right?

While it may be true that Millennials talk to people only if they can tear their eyes off their smart phones, let your competitors lose sales to unsubstantiated stereotypes while you prepare to serve 80 million potential customers who control more than $200 billion in annual buying power.

So here are the Top 5 things you need to know to sell a car to a Millennial:

  1. Know who they are. Born between 1975 and 1995, Millennials have no Cold War experience – but they were the soldiers who fought in Iraq and Afghanistan. The recession began in 2008 when the oldest ones were 33 and the youngest was 13, and it changed everything about their understanding of money, employment, investing, and car buying. So be prepared for a saver who believes wealth should come from hard work and who behaves more like a buyer you might have met three or four generations ago. And obviously, they’re totally wired – we’re sorry to tell you this, but fully 46% of them would choose internet access over owning a car.
  2. Understand that they already have debts. Millennials, including the soldiers, collectively carry $1.1 trillion in student loan debt which is a burden their parents did not have to bear. Exacerbating that is the fact that when Boomers graduated college they became part of an elite global group, whereas now 42% of American high school graduates go to college and that’s one of the lowest enrollment rates in the democratic world, making today’s degree less elite and much less lucrative.
  3. Know what they contribute to older Americans. Millennials are perfectly aware of the fact that Obamacare has them paying for Boomer’s healthcare and that their Social Security taxes provide today’s beneficiaries with benefits they may never have themselves. If any underlying assumptions inform your interactions with members of this demographic, let it be appreciation for what they provide to the seniors in your life.

Millennial Student Loan DebtAs you can tell, Millennials must deal with realities that their Boomer parents never confronted, and respecting that fact will get you more traction with this market than anything else. As they see it, Boomers had a cakewalk, and the stereotype that they somehow feel “entitled” seems like a bitterly ironic joke. And a lot of Boomers, especially those with Millennial children, are starting to agree.

This brings us to the two most important things a car dealer should know when greeting a Millennial prospect:

  1. Understand that she probably chose not to buy a car until now. Services like Uber and Lyft and shared ownership plans like Zipcar have dramatically changed Millennial’s expectations for personal transportation and have enabled many to put off car ownership, moving the average age of a first-time buyer from about nineteen to around twenty-five.
  2. But now they’re starting a family, which is one of the few things that gets this generation into your showroom. There are 40 million Millennials with children, and each day 10,000 Millennial moms over the age of 25 give birth. As soon as mom has a baby onboard, car ownership becomes a necessity, concepts of “cool” go out the window and the young parents begin hunting for the best value they can find.

Now that you’re prepared to find the moustache and the tattoos charming and to look past the stereotypes to your share of the $200 billion, be sure to take them seriously because they’re not shopping – they’re buying, and the sale is yours to lose

Perhaps start the conversation by asking which review on Yelp! got them into your showroom and which family members they’re going to talk to before making a purchase. They may be perfect candidates for quality, warrantied used vehicles, but be creatively aware that Ford dominates new car sales to Millennials with the Explorer, an affordable family car with a five-star National Highway Traffic Safety Administration rating, and the Fiesta, with has four stars and gets 28 MPG in the city.

Getting Rid of Credit Card DebtOne last thing about Millennials that makes them similar to their Depression-era great-grandparents: they don’t want to take on debt if they can avoid it. They may have needed to for college, but credit card companies have had little traction with this group. They may need a loan to get their car as well, and of course you’re prepared to help them there.

But knowing that they don’t like debt may put you in a position to offer them no-interest options that can help them make a larger down payment to lower their monthly loan outlay and increase their budget for play time with their child. Wired as they are they will not laugh when you suggest that they write you a few checks to be deposited over the next thirty days – to cover a large up-front cost. The fact is nearly 1 in 5 people – including Millennials – say they have increased their usage of checks, and among Millennials, fiscally conservative as they are, this may be because of the total financial control checks provide.

Without a doubt, simply offering will make this prospect feel respected, and it just might be exactly the solution your sales staff needs to turn a young couple into long-term clients. There’s no harm in letting them know that you’re fiscally conservative, too, and that every approved check you accept comes with a guarantee that protects your cash flow and your business, so you’ll be there to service their car for the long haul. Besides, you were thinking about growing a mustache and you know the wax is expensive… and how much was that awesome tattoo…?

hold check, payment flexibility, increase sales

Topics: Auto Dealerships, Increase Sales

Written by Tom Lombardo