Gen Z Buyers Approach Car Buying Differently Than Expected

Born between 1997 and 2012, Gen Z is the latest generation of Americans to enter the workforce. And they will need to look to the new and used car market to get to work. Even today, 76% of commuters use their own vehicle to get to work.

Despite the stereotypes of impulsive decision making and constant scrolling, Gen Z refuses to be pigeonholed when it comes to car buying.

In our Friction Point survey, we asked more than 1,100 people of all ages, including Gen Z shoppers, about their car buying experience. While there were many universal truths found, we uncovered some unique traits of the Gen Z shopper and decided to dig deeper into the data with a new report.

Thoughtful and Careful

These new results show that Gen Z adults are more thoughtful and spend more time weighing decisions before diving into a major purchase such as a vehicle compared to previous generations.

Unlike buying a smartphone that has only a few choices for options, a new car purchase consists of multiple decisions. It's not just the make and model either. Everything from the powertrain, trim level and standalone options can send a buyer into mental overload.

Even deciding the right amount for a down payment can be overwhelming. The myriad of choices available to the new buyer points to why 81% of Gen Zers said they wanted to take their time to understand all their options before signing on the dotted line.

The relationship between customer and dealer becomes even more important to this group.

Dealers who are deeply knowledgeable about the vehicles on their lot will prove to be invaluable to the Gen Z buyer. Dealership websites focusing on consumer education with comparison options and different selections will cultivate younger buyers as part of their customer base.

Gathering Info From Everywhere

More than any other generation, Gen Zers prefer an omnichannel shopping experience.

Unlike their predecessors, Gen Zers explore shopping websites (51%), social media (47%), friends and relatives (45%), and physical stores (44%) when looking for purchasing inspiration, according to a study by Survey Monkey.

To make an impact on Gen Z, dealers and OEMs should provide information through multiple touchpoints – such as social media, website and personal contact — along their journey.

Frustration Mounts

More than any other age group, this generation finds the car-buying process more difficult. Regardless of the channel, online or in-store, Gen Z shoppers are challenged by it all.

While they may be digital natives, they had far more issues buying online than their older connected cohorts: millennials and Gen Xers. 45% of them listed waiting on a salesperson as the most frustrating part of buying a car. Additional fees came in at a close second.

For these new shoppers, 56% of whom are buying their very first car, education is key. This is where a trusted and reliable salesperson, ready to educate and inform, becomes vital.

While Gen Z will spend time researching early in the buying process to understand all of their options, they’re much more frustrated by being bounced around and having to complete redundant tasks than boomers. Sales process enhancements using artificial intelligence (AI) and machine learning (ML) that auto-populate information throughout all departments will ease this sort of unnecessary frustration.

There’s Difficulty in Building Loyalty With Gen Z

Even with all of that hard work in building trust and retention, Gen Zers are least likely to recommend their dealership experience. Dealers will have to up their game if they’re going to earn the word-of-mouth seal of approval from this group.

Given that Gen Z can be more critical of their on-site experience, representatives must pack their patience and be ready for these shoppers to ask more questions than other customers. Thoroughly explaining the car-buying experience and employing consumer-focused, efficient technology will help strengthen that opportunity to build loyalty.

Gen Z tends to be more skeptical of the dealership experience and may need more time to understand their options. By addressing this group’s need for a knowledgeable expert, we can better respond and further reduce friction points such as numerous options and additional fees.

Guiding Towards a Great Experience

As our study shows, Gen Z may be brand-educated, but they’re not car purchasing experts — yet. By connecting them with knowledgeable representatives, providing detailed vehicle information through multichannel marketing, and minimizing inefficiencies, you can turn these young buyers into long-term customers.