If cars are no longer status symbols, how do you sell them?

On Monday, 4 June 1897, at 4pm, the first horseless carriage in South Africa made its debut in Brea Park, launching a love affair with motor vehicles that would endure for ages…or did it?

The 1940s saw the era of the “people’s wagon”, pioneered by Henry Ford and Dr Ferdinand Porsche, who focused on affordability and simplicity – making the motor vehicle accessible to everyone. As customers became more affluent in the 1950s and 1960s, and cars became more accessible, the focus shifted to promoting cars as status symbols. Bigger was better, and cars were given tail fins like jet fighters (and they burnt the same amount of fuel!) The 1980s saw Japanese upstarts Nissan, Honda, Mazda and Toyota undercut the European and America market – it was also the era that saw factories being exported offshore. The continued globalization of the 1990s saw greater cooperation as manufacturers began running plants together, and sharing designs. Today the industry offers greater variety in terms of price, design and technology than ever before.

However, there has been a significant shift in how consumers view cars. In the United States, drivers’ license ownership has dropped by close to 20% over the last ten years – millennials simply do not feel the need to own a car the way their parents did. Car-sharing, environmental consciousness about carbon footprints and alternatives has meant that cars are no longer the status symbol that they were twenty or fifty years ago.

The trend is not as predominant in South Africa, where cars are still aspirational items, but it’s a growing concern in Europe and the United States. Young adults prefer urban living and they socialize online. Public transport and ride-sharing apps have enabled them to make do without a car.

That does not mean that South African dealerships won’t be affected. The primary reason for the decline proffered by Gen Y-ers in these studies was that they hate the traditional car-buying process.

By 2025, Gen Y will make up 75% of all potential car buyers, and it is well worth influencing them now. While Gen Y is perhaps more disinterested in car makes and models and more inclined to see them as a way to get from point A to point B, it doesn’t mean that they will never buy a car. As you mature, and your family expands, a car is a great convenience. The question is, Will they buy the car from you?

Changing customer expectations could well be at the core of Gen Y’s viewpoint. They aren’t just comparing your dealership with your competitors – they are comparing the buying experience with all other buying experience. There are apps that can recommend products based on your past preferences and browsing history that allow you to pay and have products delivered to your door with a click. Younger consumers are comparing their experience in the Apple Store, their local restaurant and their favourite ecommerce website with your dealership and it has to live up to their expectations.

While it’s not necessary for each dealership to invest millions in apps, they have to live up to expectations. Buyers that are growing up with Twitter and online shopping expect immediacy of responses and service. They want information. If they can’t find you and your stock with the click of a button, they will simply move on to a competitor. They will not visit a dealership and to see what’s in stock and they will not be prepared to listen to a salesperson haggling for twenty minutes. They arrive with all the information about the vehicle and wanting to buy a specific item at a specific price – they aren’t interested in negotiating a deal.

Dealerships have to be online first in order to reach these tricky customers. Dealerships have to be online, but it’s not enough to be online. The information that is online has to be extremely thorough, including the price, the description and the photographs used. Stock should reflect in real time and dealer principal should be able to monitor leads and how they are being responded to.

Unfortunately, most car platforms do not cater for this model says Osborne. You cannot work through a middle man. The power has to be in the hands of the dealers themselves, not the platform used. Always opt for an online platform that allows you to manage your ads, change pricing, and view analytics in real time. That is the only way to win over millennials.

I don’t believe that Gen Y won’t buy cars in future, but companies will have to up their game to ensure that they remain relevant. The experience has to be quick, pleasant, and easy. If you do that, you will win over the new generation.