Millennials tiring of TV commercials for erectile dysfunction and rheumatoid arthritis will have their revenge soon enough. The population bulge of under-35-year-olds is making its way through the demographic grinder and will soon be reformatting everything from business models and television advertising budgets to the available goods and services on the market.
Depending on who you ask, the Millennial designation encompasses as many as 90M Americans, more than 10M more than the current population of Boomers. Marketers are in a tizzy to tease out the brand and behavioral preferences of these consumers with companies such as Whole Foods threatening to open mini-tattoo parlors in some of their stores in a bid to enhance their edginess.
This wave of new potential car buyers is of particular concern to the automotive industry in the context of a marked decline in driver’s license ownership within this increasingly dominant demographic cohort. According to research recently published by the University of Michigan’s Transportation Research Institute, nearly every demographic segment is showing declines in the possession of driver’s licenses, but Millennials are showing the steepest decline.
Auto makers have taken the hint and are scrambling to prepare for a world of alternative transportation options including ride hailing services, ride sharing, bike sharing, public transportation and, dare I say it, walking. Perhaps the most absurd example of this scramble was reported by the New York Times describing researchers working on behalf of Ford riding borrowed bicycles to get around Chicago.
In addition to being the largest demographic segment, Millennials are also the most diverse, which is giving marketers even greater headaches. This ultimately means that every expert on Millennials will be correct even though many of them will disagree.
I was particularly concerned to see an Experian report of automotive brand indexing for Millennials. The brands preferred by Millennials almost directly inverted the sales ranking of the brands in question – with the now-defunct Scion as the top indexing brand.
Notably missing from this roster of brands are Chevrolet, Ford, Lincoln, Cadillac GMC and Buick – as well as Acura, Infiniti, Lexus, BMW, Mercedes, Audi and a few others. Perhaps it is no surprise that both Ford (FordPass) and General Motors (Maven/Lyft) have launched alternative transportation initiatives to connect with Millennials.
Maybe it’s best that we keep our heads as marketers, take a deep breath and remind ourselves that Millennials for all their tattoos and ride sharing are human beings like everyone else. They’re a little more accepting of and interested in technology than the rest of us (they own more smartphones), but they, too, have limited means and can readily see the high cost of buying, owning, driving, parking, insuring and servicing cars.
If we can help Millennials mitigate the cost of owning, parking, insuring, servicing and buying a car, then I suspect Millennials will keep buying cars. If Uber-ing or Lyft-ing around town is cheaper and, most important, more convenient and sensible than owning a car, the outcome is a foregone conclusion. Millennials are pretty good at math.
There is nothing exotic about trying to save money and time and avoid inconveniences. If we keep it simple I think we can be successful selling cars and just about anything else to Millennials. And are we really going to miss those commercials for rheumatoid arthritis and erectile dysfunction?