In its fixation with young people, the auto industry ignores the real vehicle buyers: Baby Boomers.
Has every executive in the auto industry gone slap-ass crazy? Is there no logic, reality or clarity of vision left?
I’m talking about why auto makers senselessly pursue Generation Y, young adults under the age of 35. Are auto executives complete out-of-touch idiots? No. But they can fall into the category of "Stepford executives."
Why is it that almost every manufacturer focuses such marketing efforts and new- product development on the most worthless, shiftless generation in history? I call them “Generation Why Bother.”
I recall what I said a few years ago about theElement, a car specifically developed for this mystery generation. I called it the Honda “Elephant.” It was an abomination kids supposedly would buy in record numbers. As I predicted, the average age of the Element owner was over 40. The car appealed to gray panthers and dog breeders. It missed its demographic target, becoming just another cheap car for seniors.
introduced the Scion as a youth brand. The average buyer turned out to be pushing 40. All Scion achieved was scabbing sales from the Toyota Corolla as another cheap car alternative for seniors and low-end adult buyers.
So what did the manufacturers learn from that? Not much.
Beginning with the North American International Auto Show in Detroit this year, it became clear to me that virtually every auto maker is focusing designs, products, sales processes and marketing strategies on Generations Y and X.
A crop of new-age Millennial-minded marketing gurus popped up overnight. They chant “the youth” mantra and disseminate questionable demographics. I think they are pulling these alleged statistics out of, well, a part of their anatomies. And the manufacturers are buying into it!
How many times have we heard we need to change everything we’re doing because Gen Y doesn’t like to be sold this way or that way, doesn’t want to be contacted this way and wants to be marketed to that way? Frankly, who gives a damn? Most of them can’t buy a box of Cheerios without a co-signer.
An in-your-face expose in AdWeek validated what common sense had already told me. Read this, wake up, snap out it and you’ll be okay: The Millennial Male Is Not Who You Think He Is.
Collectively, the Millennial Male is flat broke. Only 62% of them have jobs, and only half of those are fulltime.
They owe more than $1 trillion in student loans. That does not mean they graduated. Many didn’t. They just attended school and racked up the bill.
Here’s the stat that blew me away: more than one-third of Gen Y still live with mom and dad.
This is the elusive generation of consumers that enthralls the auto industry. Many of them are unemployed Xbox wizards living in the family home’s basement. They’re saving up for their next tattoo, not a new car.
We’re talking about the generation you can’t advertise to because they block and filter out your message. They’d rather occupy Wall Street than participate.
On the other hand, why are we ignoring the most affluent generation in history, people who are buying more cars than all of the previous generations?
I’m talking about the Baby Boomers, 77 million consumers who have more than 75% of America’s wealth. We’re talking about sane and stable people here.
An article by Bloomberg and research by the University of Michigan outlined how seniors buy 15 times more new vehicles than Millennials do. Consumers age 18 to 34 represent less than 13% of new-car buyers.
I’ll bet people over 50 are buying more expensive vehicles with higher profitability for the industry. Look at the statistical buying power of the Baby Boomers as opposed to Millennials: Millennials: 50+ Fact and Fiction.
Older people have the money. They have the motivation. They are buying.
When creditworthy Boomers are the real car buyers, why do automakers relentlessly chase Millennials?
We’re told the economic plight of this hapless lot will change. Well, when it does and if Millennials come around, then we’ll adapt and think differently. But I suspect by the time that occurs, they’ll have transformed into their parents.
Just sayin’. Keep those emails and comments coming. I appreciate you.
Jim Ziegler is president of Ziegler Supersystems as well as a trainer, commentator and public speaker on dealership issues. He can be reached at firstname.lastname@example.org. WardsAuto readers also may comment on this article by logging in or registering below.