Gen Z Is Ready To Get Behind The Wheel. But Who Are They?
As dealers continue learning how to reach Millennials, a new generation beckons.
Entitled. Rebellious. Tech-obsessed. Fickle. There are a lot of adjectives used to refer to Generation Z by frustrated marketers — in auto and beyond.
Of course, many of these descriptions have already been shown to be myths. But one thing is definitely true: The growing economic presence of this youngest segment will require auto dealers to undertake a big shift in how they’re attempting to connect with the emerging demo. And this starts with understanding who this group is — and what they’re not.
Gen Z: Much Different Than Millennials
Loosely defined as those born after 1995, Gen Z is the first digitally native generation in history and is expected to represent $153 billion in spending power by 2020, according to a Futurecast report. That kind of growth means they’re soon poised to rival even Millennials as an economic force.
That’s not to say they aren’t already making a serious impact in commerce. In fact, they already comprise 14 percent of home renters, despite the fact that only a small segment of them have finished college and entered the workforce.
And when it comes to how they choose to make purchases, these aren’t your traditional brick-and-mortar consumers. Many members of Gen Z have been punching smartphone buttons since they were in grade school — and none of them have ever lived in a world without the internet. As a result, the ability to get what they want entirely digitally isn’t just a desire; it’s a demand.
The 8-Second Rule
Gen Z’s extreme preference for impersonal, low-friction transactions has enormous implications for all businesses — but particularly for dealerships. After all, with 82 percent of Millennials saying they would rather do anything unpleasant than negotiate for their next car, it’s not hard to imagine that the even younger digital natives in Gen Z feel even less psyched about it. Gen Z’s insistence on doing business on their terms not only makes them incredibly well-informed shoppers, but it means the brands that successfully reach them will have to do it through an especially small window — namely, a 4-inch phone screen.
In fact, Gen Z has been shown to have no more than an 8-second attention span when engaging the world digitally, with their consumption habits popularly described as “Blink, Share, Laugh, Forget.”
In Gen Z’s social-media landscape, traditional platforms like Facebook, LinkedIn and Twitter are for older generations. Instead, they rely on Snapchat and Instagram to share their personal stories and interact with brands just as they do their friends — quickly, playfully and relentlessly. And if what they’re seeing from you doesn’t grab them immediately, they’re probably swiping left.
“Gen Z have a carefully tuned radar for being sold to and a limited amount of time and energy to spend assessing whether something’s worth their time,” reports Fast Company.
Shifting Loyalty
While attracting attention on Gen Z’s digital schoolyard can be difficult (and intimidating), there is a bright spot for dealers who manage to pull it off. That’s because doing so authentically and non-intrusively means there’s a good chance you’ll end up on their “liked” list.
Getting there, though, is different than it used to be. Loyalty programs and splashy ads are out. Genuine and repeated interactions are in. On average, Gen Z watches far less network or cable television than previous generations, have often been uploading clips to social media since their playground days, and have a robust preference for video over print. They depend on social media for trending topics, content curators to vouch for their entertainment choices, and YouTube influencers to digest current events — often making little distinction between the various channels they consume. To Gen Z, it’s all just “watching TV.”
They Seek Flexibility — And Shared Values
The Great Recession and today’s political uncertainties have both had significant impacts on Gen Z. For one, they place a higher emphasis than previous generations on keeping their situations flexible — from the purchases they finance, to where they live, to how they get around. And two, they expect the companies they do business with to be aligned with their view of the world.
“Companies need to recite their values, show how their products are made, reveal what ingredients are used and, if they’re really feeling gutsy, declare how they came up with pricing,” explains Brit Morin, founder of media powerhouse Brit + Co.
For dealers, this goes beyond having a handy explanation for how you arrived at a sticker price. It means respecting the fact the potential customer who reaches out to you on social media might not be ready to come to your dealership yet. It might mean communicating exactly how market conditions led to the price of that gently used 2016 model with the back-up camera and panoramic moonroof. And it means embracing new ways of doing business that mesh with the all-digital demands and commitment fears of a generation that will soon make up your biggest customer base.
