ATLANTA -

Millennials — potential buyers between the ages of 16 and 32 — are representing a greater portion of a dealer sales base, so what should managers and salespeople highlight on used models that might appeal to this demographic? AutoTrader.com aims to shed some light on that exact subject.

A new study from the site reveals that when it comes to vehicles, Millennials show some distinct characteristics such as:

—Highly aspirational and image-conscious
—Are more open to import brands
—Actually do have an interest in vehicles and driving

These insights and much more are discussed in the study titled, “The Next Generation Car Buyer,” which AutoTrader said is a project that took a deep look at the attitudes and behaviors of Millennials when it comes to vehicles and car shopping.

The study explored how Millennials think and behave across the entire automotive shopping decision journey including awareness, trigger event, consideration, evaluation and purchase.

In addition to examining how Millennials compare to Generation X and Baby Boomers, the study examined the behaviors and attitudes of younger (ages 16-24) and older (ages 25-32) cohorts of the Millennial Generation, noting areas of difference.

“This generation represents the future of our industry, so it’s essential to have a deep understanding of their wants and needs,” said Isabelle Helms, senior director of research and marketing analytics at AutoTrader.com.

“By looking at differences between older and younger Millennials, we gain an understanding of how their attitudes and behaviors could change over time as they enter the next phases of their lives,” Helms continued.

Brand Perception

AutoTrader discovered Millennials say the brands that fit them best mirror the image they have for themselves: stylish, sophisticated and innovative.

Luxury brands scored highly in these areas with BMW, Mercedes-Benz, Lexus and Audi said to be the most stylish brands; Mercedes-Benz, Lexus and Audi seen as the most sophisticated; and BMW, Mercedes, Audi, Honda and Ford seen as the most innovative.

When it came to overall brand fit, Millennials surveyed said that in order, Audi, Honda, Mercedes, Toyota, BMW and Chevrolet were most reflective of their personality.

“While Millennials may not be able to afford many of these brands now, the brand fit metric is a good way to look at where the market is headed,” said Rick Wainschel, vice president of automotive insights at AutoTrader.com.

“Lower price point vehicles like the Mercedes CLA, BMW 1-series and Audi A3 are making luxury cars more attainable for Millennials earlier in life, which could help these brands establish long-term consideration and loyalty.” 

While Millennials may identify with luxury manufacturers, AutoTrader indicated that those surveyed say they're still most likely to purchase mainstream brands — even when price isn't an object.

In order of appeal, those brands included Honda, Chevrolet, Toyota and Ford.

Helms pointed out that Millennials rated these brands highly for practicality — an indication of what's driving their purchase decision.

“Life stage, economic situation and brand awareness are the primary factors determining which vehicles millennials are currently placing on their shopping lists,” Helms said.

The study also revealed that “American-made” doesn’t hold the same meaning for Millennials as it does for Baby Boomers, and that Millennials are much more familiar than Baby Boomers with import brands and are more likely to consider them.

For example, Millennials surveyed were much more familiar with, in order, brands such as Lexus, Honda, Kia, Nissan and Hyundai than Baby Boomers, and said they’re much more likely than Baby Boomers to consider Audi, Nissan, Kia, BMW and Mazda.

“Millennials have grown up in a world where import brands are well-established in the market, so there’s much more of a level playing field in their minds,” Helms said.

“Millennials are more focused on which brands have the features and attributes they want, less on where a car may have been manufactured,” she continued.

Vehicle Shopping

When it comes to vehicle shopping, AutoTrader found that Millennials depend heavily on research to help drive their purchase decisions.

Millennials rely more on word-of-mouth when shopping for a vehicle than other generations with the breakdown as follows:

—Millennials: 43 percent
—Gen X: 28 percent
—Baby Boomers: 32 percent

The study also showed that most of that word-of-mouth communication is face-to-face with face-to-face constituting 90 percent, followed by blogs/forums (41 percent) and e-mail (36 percent).

The study determined Millennials also are most likely to be first introduced to their model of choice through a family member or friend, as opposed to Baby Boomers who are most likely to be first introduced to their vehicle on the dealership lot.

When it comes time to head to the dealership, the site determined Millennials actually enjoy browsing the lot more than older generations and are more dependent on the salesperson for information. However, they’re also more likely than older generations to go out of their way to avoid interacting with dealership staff. 

“Millennials view the dealership as a key piece of their research process — they're looking for experts to help answer their questions and to touch and test out the physical car before making a purchase,” Helms said.

“That said, Millennials want time and space to make the right decision, and will value the salespeople who provide the information they seek in a no-pressure way,” she added.

Relationship with Vehicles

According to the study, younger Millennials are delaying getting their driver’s license at a higher rate than older generations. The breakdown went this way:

—36 percent of younger Millennials
—27 percent of older Millennials
—28 percent of Generation X
—24 percent of Baby Boomers

However, study orchestrators found that this trend has very little to do with other factors such as:

—Lack of a need to drive: 9 percent
—Lack of an interest in driving: 6 percent
—Lack of access to a vehicle: 5 percent

The study discovered that younger Millennials are “too busy with other things,” which came in at 23 percent, are “afraid of driving,” which came in at 19 percent, find it to be “too expensive,” which came in at 15 percent and "want more time to train,” which came in at 14 percent.

“While today’s teens may not view a car as the key to social freedom like Baby Boomers did, it’s still an important tool to keep them connected to the things that matter,” Helms said. “Our research shows they want to drive, they just aren’t making it as much of a priority.”

When it comes to what they want in a vehicle, more than 70 percent of younger Millennials said infotainment features are “must-haves.”

Nearly 50 percent of Millennials surveyed said it’s important that their vehicle reflects their personality and nearly 40 percent said it’s important their vehicle reflects their accomplishments.

But, as Millennials age and mature into different phases of their lives, they become more pragmatic in what keeps them happy about their vehicle, according to the study.

For younger Millennials, AutoTrader found style and features drive vehicle satisfaction, while older Millennials are more focused on safety and performance. 

“Products that include millennial must-haves — unique design, the latest technology — at a price they can afford will win,” Wainschel said.

Study Background

The primary piece of research driving this study is the AutoTrader.com Millennial Survey, administered online by Harris Interactive among 1,657 Millennials, 993 Generation Xers, and 1,062 Baby Boomers between Jan. 7 and 25.

For purposes of this study, orchestrators explained younger Millennials were defined as those between the ages 16 and 24, older Millennials were between ages 25 and 32, Generation Xers were age 33 to 47 and Baby Boomers were between 46 and 66 at the time of the survey.

The survey included an oversample among those who purchased a vehicle within the past three months.

In addition, the site mentioned 75 Millennials who were actively shopping for a vehicle during the study period participated in a month-long online community, providing real-time feedback on their experiences.

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