Millennials focus on price, fuel efficiency, and safety when shopping for a vehicle, and they research their purchase via a mobile device. Gen X researches from home (on an old-school computer), and the site Credit Acceptance explains that the Baby Boomers prefer their own wisdom related to their purchase versus that of friends, family, etc. What about Gen Z, though?
The younger demographic might be the buying target for companies; they are the newest consumer darlings. Car dealerships now need to focus ads and messaging to this generation. How does Gen Z buy cars? Unlike older generations, Gen Z:
- Researches more
- Uses immersive tech like augmented reality
- Prefers the in-person experience
- Wants up-front communication
- Likes to negotiate
The Zoomers Research Their Car Options
Many sites note a key buying behavior of Gen Z: they take their time. This generation extensively researches their purchase to ensure that they make the right choice and perhaps the best choice for their needs and budget. Gen Z researches more than other generations.
ACV Auctions reported that this generation also is known for getting insight from friends and family related to car purchases in addition to online info (like reviews). While other generations might do their research via computer or their mobile device, Gen Z seems balanced in that this generation researches online but also takes into consideration the opinions of their close circle.
Gen Z Explores via Immersive Tech
According to a study from Snap (parent company of Snapchat), nearly all of the Gen Z individuals surveyed (92 percent) would like to use augmented reality to aid their shopping experiences.
During the pandemic, buyers didn’t have the option to shop in stores as many closed to in-person traffic to keep workers (and the public) safer. Shopping became a virtual experience, and many businesses moved sales and buying options to their website.
When shopping online, though, understanding products wasn’t always easy. The shopper’s uncertainty and inability to fully explore products beyond a photo was an issue long before the pandemic, though. To help buyers understand products when shopping from home, businesses started to offer augmented reality experiences. This technology allowed businesses to launch try-on experiences or other preview options.
The power of augmented reality lets shoppers preview furniture in their room, paint colors on a wall or even cosmetics on their face. These experiences provided a means for buyers to have an in-person experience with products from home. Augmented reality could be widely accessed by anyone with a smartphone or tablet; consumers simply used their camera on these devices to capture their environment (i.e. a room, the wall, or even their face) and launch the experience to see the product magically appear with the aid of realistic graphics.
Buying a car also became an online option during Covid, which, for many dealerships, was not the norm prior to the pandemic. Augmented reality experiences were used to help manufacturers showcase a new model to consumers or to provide a virtual showroom experience. Depending on the design of the experience, car shoppers might drop a 3D depiction of a car model into their garage or driveway and use their phone’s camera to navigate the experience and walk around the car; some experiences might have given the consumer an option to choose different paint colors for their vehicle, too.
Gen Z might like or even prefer these immersive experiences when shopping, and offering an augmented reality showroom online for these buyers might be another opportunity for dealerships to help them research their options. In addition, augmented reality allows for shoppers to gain more detailed insight about a product; again, augmented reality resources might let car shoppers check out all the different paint options or even look inside the car and explore it.
Gen Z Shops In-Person
Dealerships that would assume that a tech-centric and extremely tech-literate generation would prefer shopping online doesn’t fully understand this generation. While Gen Z researches more than any other generation, they also prefer buying a car in-person.
According to CDK Global, Gen Z doesn’t find the online buying process simplistic when purchasing a vehicle. While Gen Z has grown up with the internet and hasn’t known life without social media, they don’t love the online process for buying a car. In fact, CDK Global reported that 22 percent of Gen Z who were surveyed noted that this process was “more difficult.”
That being said, Gen Z doesn’t like for their time to be wasted. They might want the insight of the sales team, but this generation does not want to fill their time at the dealership with endless waiting or unresponsive staff. The ‘I need to talk to my manager’ sales technique might not go over well with this generation of buyers.
Gen Z Wants Good Communication
Some buyers want to get in and out of a dealership; while Gen Z doesn’t like their time to be wasted unnecessarily, they value good communication during the buying process. For dealerships, a knowledgeable sales team that can provide insight might go far for a Gen Z buyer.
Clear communication also could be crucial. Again, sales games might not go over well for Gen Z. An article via AutoWeek interviewed the director of product marketing for CDK Global who explained that dealerships who are selling to Gen Z buyers should “…assume a complete experience and a pleasant experience that helps educate and inform the shopper as they’re going through this car buying process.”
Gen Z Likes to Haggle
Some car shoppers dislike the negotiation process at the dealership. Gen Z is not among those who hold disdain for haggling; in fact, Inspira reports that Gen Z likes the negotiation process.
Dealerships should not perceive Gen Z buyers as being timid about negotiating. Since these buyers conduct so much research, it makes sense that they might be armed with information and ready to engage in the negotiation process. Dealerships need to be prepared for Gen Z buyers who are ready to haggle!
What Type of Vehicle Does Gen Z Purchase?
Millennials might want affordable, fuel-efficient and safe cars, but Gen Z prefers luxury. Inspira cited a Mintel report that noted that Gen Z prefers sports cars followed by electric models. What do these vehicles have in common? Higher price tags!
Dealerships might find that their Gen Z buyers gravitate towards greener vehicles or sleek and fast models. This generation might shun budget-friendly models.
Connecting with Gen Z
Dealerships that want to focus on increasing their visibility with Gen Z might need to creep out of their ad comfort zone. To reach Gen Z means to find Gen Z’s favorite online sites and hangouts. While Millennials might love Instagram or even Facebook, businesses can find Gen Z on TikTok.
Businesses might not be active on this social media platform, but it is becoming increasingly popular especially among the younger generation. TikTok is all about short video content. Businesses that want to get active on this social platform will need to adjust their content to fit the TikTok format and style.
Create fun short videos that introduce a new vehicle model or a video that provides quick helpful tips about car maintenance. Remember that this generation will research their purchase more than any other generational demographic. Dealerships should offer tools that help Gen Z in their hunt for a new vehicle.
Fun topics also can help dealerships mix up their TikTok offerings. Think about profiling wacky car colors or focus content on another unique topic that will generate interest. Dealerships also can create a video series that help highlight the car buying process. Tell buyers how to get pre-qualified for financing, give them details on the difference between engine types, etc.
Dealerships also could consider adding more engaging resources to their website. If the budget allows, offer an augmented reality showroom that lets buyers explore cars at home.
Not every dealership can launch an augmented reality experience for buyers. However, there are other immersive tools that dealerships can provide buyers who are researching vehicles online. For example, EVOX Images offers 360 degree spin photos; these images are interactive by design.
With a spin image, car shoppers can use a fingertip (for mobile devices) or a mouse to engage with a 3D depiction of a vehicle of their choice and rotate it to explore it from all angles. Each image rotates in 360 degrees.
EVOX Images also offers interior spin photos called panorama images. Again, a fingertip or mouse is used to navigate. With a panorama photo, car shoppers can look all around the interior of the car to explore the space; they can even look up at a moonroof.
Engaging and immersive resources can amplify the user experience; for Gen Z shoppers, tools offered by dealerships can allow them to further explore all their options to determine which car is their best option.
Gen Z is now the target buying demographic for many businesses. To market products to this generation, dealerships need to understand their buying habits, their preferences and dealerships should be prepared for these buyers to negotiate.