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Cracking the Millennial Code

Millennials were top of mind at the industry’s annual get-together, and one expert says auto finance represents the gateway drug to financial services for this coming-of-age demographic.

May 2016, F&I and Showroom - Cover Story

by Jim Henry

Generational expert Jason Dorsey tells the largely Baby Boom audience of auto finance execs that they, along with dealers and OEMs, need to improve how they communicate with Millennials.
Generational expert Jason Dorsey tells the largely Baby Boom audience of auto finance execs that they, along with dealers and OEMs, need to improve how they communicate with Millennials.

Auto retail and auto finance weren’t designed to irritate Millennials. It just seems that way, according to author and researcher Jason Dorsey.

“You guys really use a lot of big words in your emails. My generation, we have no idea what these words mean,” he teased a largely Baby Boomer audience of auto finance executives in Las Vegas.

Besides face-to-face interactions at dealerships, auto finance sources and dealers commonly communicate with customers by a combination of phone, voicemail and email.

Yet Millennials hate talking “live” on the phone with a stranger. They probably won’t read an email beyond the subject line, and they don’t listen to voicemails, either, Dorsey said at the American Financial Services Association (AFSA)’s Vehicle Finance Conference in late March.

“What are the two things we’re most uncomfortable with? Talking face-to-face and talking on the phone,” said Dorsey, who serves as chief strategy officer for the Center for Generational Kinetics in Austin, Texas.

He defines Millennials as the generation born between 1977 and 1995. In the United States, he said there are 79.8 million Millennials, the biggest generation since Baby Boomers.

The Gateway Drug

Dorsey said auto loans are likely to be the first big financial commitment for Millennials, after student debt. He said many Millennials don’t have credit cards, driver’s licenses, checking accounts or any credit history beyond student loans.

He noted that Millennials are just as interested as previous generations in working, getting auto loans, getting married and having children — and even mortgages — but the Great Recession delayed these major life events compared with previous generations. And growing up with the Internet changed how Millennials like to do business.

“Auto finance is going to be the gateway drug to financial services,” Dorsey said, adding that lenders and dealers can build trust and loyalty with younger buyers, but they have to communicate better and be as transparent as possible.

Dorsey told the audience — and the auto finance execs inside Caesars Palace’s Palace Ballroom seemed to agree — that finance sources, dealers, and OEMs all need to improve. That involves choosing the right format to communicate and tougher challenges like selling cars and making loans online — all with an absolute minimum of voicemails, live phone calls or face-to-face interactions.

Need for Speed

Ross Choate, COO for John Kennedy Dealerships in the Philadelphia metro area, acknowledged that the finance process can be improved, and that vehicle selection is where dealers can really connect with Millennials.
Ross Choate, COO for John Kennedy Dealerships in the Philadelphia metro area, acknowledged that the finance process can be improved, and that vehicle selection is where dealers can really connect with Millennials.

Younger buyers are also pushing the drive to faster and faster transaction times, other panelists noted at the Vehicle Finance Conference.

“Millennials value speed. As lenders, we better do everything possible to facilitate this,” said Andrew Stuart, president and CEO of TD Auto Finance.

“At the dealership level, Millennials prefer to communicate by text. They want to do as much as possible in the digital environment before they get into the dealership,” Stuart said. “But what do we do in the dealership? Put ’em in a box and try to sell them stuff.”

Dorsey said Millennials prefer to communicate electronically, in this order: by text, by email and through social media. By not adopting online selling and financing quickly enough, he added, the auto industry seems to think Millennials will set aside the buying experiences they have in other retail segments and put up with what they consider old-fashioned and uncomfortable practices in the automotive space.

“Millennials expect a buying experience that’s online, on a screen, and you’re in and out,” he said. When it comes to buying a car, “Do you think they’re going to lower their expectations? No.”

Kicking the Tires

Still, dealers who served as panelists at the conference insisted the one-on-one human element would never go away entirely, especially for buyers with subprime credit, who need more help from a dealership than most customers to match the right car with the right financing.

“Thankfully, people still like to come to the store and kick the tires and look at the products,” said Ross Choate, COO for John Kennedy Dealerships in the Philadelphia metro area. “Maybe we have to get better at that finance part. That middle part, when they come to pick something out, is our opportunity to create loyalty.”

Bob Shuman, the owner of Shuman Chrysler-Jeep-Dodge-Ram in Walled Lake, Mich., admitted that dealerships need to improve how they handle customers who walk in the store after doing a ton of research online, but he said the art of selling still represents value.

“I’m a Jeep dealer, and Jeep can tell you everything about people who are likely to buy a Jeep. People get Jeep tattoos. It’s a great brand,” he said.

“But as to why a particular individual buys on a given day at a given dealership, they don’t have a clue about that,” Shuman added. “It comes down to the individual buyer, and the individual dealer, and the individual salesperson.”

And even though customers shop online, dealerships are going to continue to feel obliged to maintain a big inventory, he said. “It’s America. We want just what we want, and we want it right now. If there are two dealerships and I’ve got 10 and he’s got 200, where’s that customer going to go?”

Jim Henry is a freelance writer based in the greater New York city area. Contact him at


  1. 1. STEVEN JENNINGS [ May 11, 2016 @ 01:28PM ]


  2. 2. Dan [ May 16, 2016 @ 08:07AM ]

    I'm on the fence on this one.

    I am going to be in the market for a new vehicle in the fall of 2017 and I am doing TONS of research. I plan to do as much of it as I can online or via phone/email/text/ whatever.

    On the other hand.....I am greatly looking forward to test driving which requires dealer visits. What I am VERY afraid of is going on that test drive and the sales consultant trying to pressure me to buy right then and there. It happened once and I bolted out the door. I wasn't ready to commit right then and there. I view things like this as having to take time and require patience. But let's face it...a test drive DOES make one hot to buy at times.

    So what to do?

  3. 3. Cory [ May 23, 2016 @ 11:29AM ]


    You're not alone in your approach. In fact, you are probably in the majority now. This is the new way of car shopping. My recommendation would be, once you have finalized the list of the makes/models you are interested in, do your research on the store sin your area that sell those makes/models. Look at online reviews and find helpful reviews of certain salespeople in those stores. Heck, call the service department and ask which salesperson they would recommend. Once, you have a sales guy that was referred to you or has good reviews online, call that sales person and tell them your plan. Let them know you want to set up an appointment just to drive the car. A reputable car salesman will be understanding and willing to let you borrow 30 minutes of his day to test drive. And, if he's really good, he will be able to give you all of the fine details of the car you test drive and what the competition lacks.

  4. 4. Dan [ May 24, 2016 @ 03:46PM ]

    Thanks Cory!


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