For years we’ve been told that the Internet and the era of consumer electronics was going to change everything — from the ways in which people buy automobiles to, dare it be said, whether they even need an automobile at all. Considering the increasingly congested highways most travel every workday, combined with increasingly prevalent high-speed Internet connections, it seems like telecommuting should have become more of a thing long ago. But, sadly, even for those whose jobs would make it practical, many companies believe that “unless we can see you, you aren’t working.”
And certainly when it comes to the Millennials and cars, the discussion has been one-sided and relentless. We’ve been led to believe that they don’t care about automobiles at all, and some columns would have us believe that those narcissistic Millennials are not social — they’re really only into themselves. (Hey everybody, look at my new selfie!)
Except … Millennials seem to be gravitating toward downtown regions, which is purportedly why they don’t need or want an automobile. Not to put too fine a point on it, but clustering into downtown regions for work and play certainly seems social.
The problem with what most believe about the younger generations —whether they love cars or not or even if they own cars, or how they want to interact with retail operations — is that most of it is completely wrong.
Not Quite Self-Fulfilling Prophecy
A year ago in this column I reported the statistic that people under 30, as a percentage, purchased slightly more than half as many new cars as Baby Boomers had bought at the same age — and yet that same survey showed that Boomers were buying far more new cars than their parents had at the same age. As I pointed out, nobody understood what that survey was really showing. Basically, it was nothing more complex than the fact that Boomers were still buying their kids new cars because the kids often could not afford to buy their own. That fact was true in my family and in quite a few families that I know.
Now two weeks ago Edmunds.com released a new study they called the Millennial Mobile Car Shopping Report. And guess what they found out? Turns out the kids may love their smartphones and apps, but when it comes to motoring, 64 percent of them claim they actually prefer a “face to face” interaction with dealers when they get a new car. And get this: fully 96 percent of all the kids surveyed said it was extremely important to test drive a vehicle before they purchased it.
That’s right: One of the largest online new car sales lead services admitted that the vast majority of kids today prefer meeting with a dealer on their new car purchase — and virtually every last one of them wanted a test drive to validate the value of the car they believe they want. So, it’s not just the price.
It gets better — and this next line is for all the car dealers that read this column: Only 33 percent of the kids use their smartphones or other mobile device to shop for pricing before they buy. While only 21 percent of all older buyers do the same thing.
The Automotive News carried that story on March 27, 2015, and included a quote from Edmunds.com CEO, Avi Steinlauf. “This notion that Millennials will sit off in a corner, punch some things into their phone and the next thing you know they’re driving a new car is a little fanciful.”
And yet, folks, it’s companies like Edmunds.com that have tried to convince us for years that that’s exactly how everyone was buying their cars today.
Be Quiet and Take My Money
Doubt that last statement? After all, there’s been the non-stop, almost two decade-long reporting and who knows how many TV ads educating us that you don’t need anything but your iPad or smartphone to purchase your next new car. Yet three days later a much larger survey came out from Autotrader.com, titled the “Car Buyer of the Future” study. Turns out that Autotrader reported that fully 84 percent of individuals want to “buy their car in person,” especially women and younger buyers.
Now, according to Autotrader, the average person is spending 16.7 hours online researching their next car purchase; obviously, the Edmunds.com PR doesn’t suggest that anyone spends that amount of time before actually going to a dealership and attempting to make a purchase.
But one does wonder how Autotrader framed the questions on its survey. Because they also claim that what people hate the most about the current car buying process is, according to the Detroit Free Press, “The 4 – 6 hours it takes to complete the transaction at the end.”
It doesn’t take 4 to 6 hours to walk into a good dealership, pick out the car you want, take a perfect demonstration drive with a salesperson who truly wants you to know everything possible about the car you are interested in, negotiate the deal, sign all of the paperwork and take your car home. Unless you and your salesperson take a two-hour break to watch the season finale of “Downton Abbey” before you sign the final paperwork.
I’ve done finance in dealerships. Most customers really want that end of the process to go very quickly; it’s not that they’re impatient, but mentally they’ve already purchased their car and they’re excited about going out and driving it.
Less Important than It Hoped It Would Be
That last survey also claims that a buyer will drive farther for a great salesperson than for a great deal. Hogwash. One can’t tell who the truly great salespeople are by an e-mail or text. But you can immediately tell who lowballed you the best on the car you think you want. (Lowballing is giving out a “sucker” price — for which the product can never be sold — just to get the customer in the door.)
So what did we find out that these two surveys and the numerous journalists who covered them think the public needed to know? The vast majority of people think it’s very important to do business with a car dealer face to face; and almost every last one believes it’s critically important to take a great test drive in the vehicle they are most interested in. Which means, wait for it … these surveys are telling us nothing has changed about the car business or how people actually buy their automobiles.
That’s right, after all these years being told the Internet would change everything, after all the thousands of ads on TV on which service to use to save money on a new car, those exact same companies have now surveyed people and found far, far fewer of them actually use their services, because in the end it’s more important to deal in person and drive the car you think you really want.
There’s one exception: Forgetting the irony of an Internet lead provider promising super discounts on your next car purchase, only to have to admit their clients would rather drive farther for a great dealer than to get a better price, I don’t in the least believe that. But the fact that those surveyed said they would drive farther for a better salesperson tells us that they actually want to do that.
That’s right. People want a great buying experience from a great dealer, and that’s more important than price.
So much for the Internet changing anything at all.