F&I Meets Gen Y

As time moves on, so do our customers. Unfortunately, the automobile industry rarely moves at the same pace. Today we’re seeing a new type of customer that is proving to be a challenge for the business manager. Yes, I am speaking about the Gen Y customer.

Born in the late ‘80s and early ‘90s, Gen Y, according to the latest census information, accounts for approximately 21 percent of the total population. On the surface, this appears to be a small group. However, according to our research, these customers account for 40 percent of the car-buying population. The other question we have to consider is: Who is Gen Y influencing? Sure, they influence other Gen Y buyers, but they also influence their parents.

We have seen an interesting shift in buying strategies in the past few years that we expect to continue: Parents are looking to the kids to research the purchase of new vehicles instead of vice versa. Granted, the parents may not listen to 100 percent of what the kids have to say, but the kids are now doing the research and putting a lens on the information that the parents may need to consider. The parents are also taking cues from their Gen Y siblings on how to use the information and technology available today.

Objecting to Sales

Why is this happening and why should it matter to the individuals manning the F&I office? It is simple: Gen Y is the first truly technologically advanced customer base. Think about it: Gen Y has always had a computer, laptop, the Internet, a cell phone and instant gratification. When members of this generation want to know anything, the answer has always been, quite literally, at their fingertips. This has helped to create a customer base that knows everything.

This mentality has influenced the way Gen Y buys. They research the product or service, read blogs and reviews. And it’s this “I make my own decisions” mentality that we in the business office must take into serious consideration.

The Gen Y buyer does not like a “selling” environment. And let’s be honest, the business office looks like a selling situation. However, even the Gen Y buyer knows and accepts the sequence of events that must take place to purchase a vehicle, so do your best to make your office not look like a selling office. For starters, remove the brochures from your desk and put them in a drawer. Only pull them out when needed.

The ‘Me’ Generation

Another dynamic we must take into consideration is how this generation grew up. When they played sports as a child, who won at the end of the game? Chances are no one did. Everyone got a ribbon and went for pizza at the end of the day. To Gen Y, there are no winners or losers.  Hey, this is a generation that’s often referred to as “Generation Me.” It is the acknowledgement of the information gathering process that Gen Y likes. It makes the process about them and allows them to avoid a win or lose situation. We need to address this in the business office so we can improve penetrations.

What is not working very effectively with the Gen Y customer is the same thing that isn’t working with anyone: step selling. The same can be said for a hard presentation of products that have no benefit to the customer. These are the same selling situations that today’s customers want to avoid and may be detrimental to business office numbers.

With Gen Y, it has to be about them, so cater your presentation to them. If you take a quick moment of discovery time and find out what their primary emotion is about the vehicle they are purchasing, you will figure out what their emotional trigger is. There is a reason they are buying this vehicle. You need to find out what it is. And whatever their emotional trigger is, you must relate it back to the products sold in the business office. This allows you to make your presentation about them. So feed this crowd the information it’s craving and make sure to present only what can be justified to them.

Find Their Trigger

Gen Y customers also don’t care what you think or what you like about a product. So think twice about saying something like, “Mr. Customer, what I really like about the service contract is ______.” This type of wording does not connect with this group. So, pull their emotional trigger without making it about you.

Remember, to the Gen Y customer, there are no winners or losers, so in negotiations, stop trying to “work a deal.” You need to have the ability to offer payment relief; however, know there will be consequences.

If the customer wants to purchase products and needs a lower payment, offer a different product with fewer features to help them out. For example, if you start with a five-year ancillary product, offer a lower payment with only three years’ worth of coverage. The service contract offers the most flexibility in regards to payment relief.

The Gen Y customer is becoming more commonplace in our dealerships. So, we in the business office need to recognize this customer and make them comfortable.  Remember, when it comes to Gen Y, it is more about them and less about us.

Tony Dupaquier is the director of F&I training for the Automotive Training Academy, a division of American Financial & Automotive Services Inc. He can be reached  at [email protected].