BY STEVE HOWARD
According to a study by AARP and J.D. Power, 62.3 percent of all new vehicles are purchased by buyers over 50. People 50 to 68 are known in the marketing world as baby boomers, and the U.S. Consumer Expenditure Survey shows that they control 70 percent of the nation’s wealth and half of all discretionary income, which now averages more than $24,000 per boomer per year. How are you tapping into the baby boomer car market?
On the flip side of new car-buying ability are the 15- to 35-year-old millennials, of which 36.6 percent are unemployed and 36.5 percent still live with their parents, according to the Pew Research Center. As an extra burden to this generation’s FICO scores, two-thirds of millennial graduates owe an average of $27,000 for student loans. Limited disposable income is a key reason only 11.5 percent of all new vehicles are registered to millennials.
Here’s a fact that every automotive sales consultant needs to know: 22 percent of all boomer parents contribute financial upkeep for an adult child not in college, according to a Nielsen study. So a millennial may be on the phone or in the showroom, but chances are their parents might be providing the down payment and influencing the buying decision.
Unlike millennials, boomers have a long-term love affair with their cars. The happiness they get from cars runs much deeper and lasts years longer than almost anything else they can buy. After loved ones, boomers love cars. Cars represent freedom. Cars defined boomers, and today, the vehicle they drive is still silently telling the world who they are.
Millennials use smartphones to meet new friends; their parents used cars. Cars were the heart and soul of the early boomer social experience. Boomer boys met boomer girls slowly cruising Central Avenue on Saturday night in their cars.
To maximize premium and luxury sales, ask questions to help boomers relive those memories and feelings of open-road-ahead excitement.
Is Your Sales Process Geared Toward Millennials?
If you’re using a logically based sales process that focuses on offering the lowest monthly payments or negotiating a price acceptable for the buyer, you’re losing boomer sales. Why? Because that generation uses emotions more than logic when making car-buying decisions. To sell the way boomers buy, follow this proven six-step process.
With so many models, packages and technology the first thing boomers shop for is a sales consultant they can trust. High trust trumps low price. Show a sincere interest, monopolize listening and encourage boomers to tell you more.
Questions not only allow you to discover your buyers desires, they also allow you to create new desires. Questions such as “Have you ever changed lanes at high speed then suddenly saw another car hiding in your blind spot? Did you ever wish there was a way to keep that from happening again?”
Now, when you demonstrate the blind-spot warning system, boomers listen harder because emotionally, they already own it.
Customize Their Ideal Vehicle
Once boomers come face to face with the scary fact they have more days behind than ahead, this sudden awareness of mortality jolts many boomers into buying the vehicle they really want. And this time they’re not going to compromise. Here’s where you become invaluable – boomers need your listening skills and product knowledge to help them customize the perfect vehicle for their changing roles, physical needs and lifestyle.
Let boomers sit in the fit-like-a-glove heated driver’s seat and feel how it reduces the strain on the back and neck muscles. Help grandparents discover the road-trip-ready, grandchildren-friendly onboard entertainment system. Show how boomers can safely back out of their driveway without twisting their necks and watch as they move themselves up to the model with the rear-view camera package.
Every time boomers buy new vehicles they face five potential risks. The way to provide the greatest peace of mind is to help boomers identify these risks and reduce each one to their satisfaction. One way to comfortably discuss risk is to ask questions such as “When you pull into fast moving traffic how important is quick acceleration” For most boomers, safety trumps MPG.
Boomers are old enough to know that any purchase that requires negotiating carries risk. Over the years most boomers have a losing record when negotiating with experts. Instead of negotiating to keep your gross by holding your price, review all the benefits each boomer buyer wants. Every time you review their emotional benefits, desire to own them grows and the price seems less important.
Baby boomers buy the vehicle that gives them the most emotional satisfaction they can afford. Boomers must experience the fit and finish; smell and aromas; touch the controls; and visualize the joy of driving down that long and winding road. The more emotional benefits boomers receive, the less they compare and quicker they buy at full-advertised price.
There are four indispensable benefits only you can provide: your dealership, the greatest peace of mind, your buyer’s ideal vehicle and you. When boomers want the four benefits your competition can provide – there is no need to negotiate because your competition has been eliminated.
24 hours after the sale contact your boomer buyers and ask this question: “Are you 100-percent satisfied with everything?”
No matter how small their dissatisfaction might be, do everything in your power to take care if it immediately. There is no faster way to create an unlimited supply of pre-sold boomer referrals. This requires a daily investment of your time, but when done consistently can pay phenomenal dividends for you and your loved ones long into the future.
Millennials get a lot of attention these days because they are seen as tomorrow’s most important new car buyers. But after inheriting almost $10 trillion dollars from their living parents, baby boomers will continue to be the best new car buyers.