Successful businesspeople, including independent tire dealers, try to predict what’s next. Spotting a trend before it becomes a trend and being able to capitalize when that trend hits is critical to long-term success.
There is no shortage of information on the purchasing habits of today's customers. So much has changed over the last four-and-a-half years that it’s almost impossible to summarize the automotive consumer evolution concisely.
There also has been a lot of attention paid to studying generations of people who are purchasing cars, tires and service:
- Baby Boomers, who were born between 1946 and 1964;
- Generation X, members of whom were born between 1965 and 1980;
- Millennials, who were born between 1981 and 1996, and;
- Gen Z, members of whom were born between 1997 and 2012.
As a tire dealer who also provides auto service, looking at data about the vehicle buying habits of these customers — as well as their general attitudes toward vehicle maintenance — will help you gain a better understanding of your future customer base.
According to Statista, 42.4% of the current U.S. population is either a Millennial or member of Gen Z. These consumers are very different from the Baby Boomers and Gen Xers who have come before them.
Cox Automotive recently interviewed 5,000 car shoppers and separated the results by generation.
According to survey results, only 24% of Gen Z buyers said they knew what they wanted at the start of the car-buying process, compared to 26% of Millennials, 28% of Gen Xers and 38% of Boomers.
The reverse was true regarding the number of days spent researching and shopping for a new car, with Gen Z buyer leading the way, followed by Gen X, Millennials and Baby Boomers.
In another survey commissioned by Cars.com, 76% of Gen Z respondents said they bought their first car before turning 21, compared to just 56% of Millennials.
While 16% of Millennials favor online shopping for cars, only 9% of Gen Z respondents said they prefer to buy cars online.
As someone who lives with and works with members of Gen Z, all of this makes perfect sense. Members of that generation tend to drive nicer vehicles than I drove when I was their age and seem to be more comfortable with a car payment to make that possible.
I ran into a friend of my son's not too long ago who is 23 years old and is driving a BMW. His first car was an Infiniti, which he sold to buy the BMW.
My first car was a 1972 Buick Century that died before I was able to sell it. I’m currently driving a 2017 Toyota Corolla that I bought used in 2021, so I cannot relate.
I could afford a nicer car, but my Gen X practicality about a low car payment, low insurance and low operating/maintenance costs are the most important factors for me.
For Gen Z, the most important car shopping factors are price, followed by fuel efficiency, longevity and reliability, the vehicle’s safety rating and finally, comfort. Members of this generation are cautious buyers who are going to take their time researching a vehicle purchase.
Members of Gen Z also want to talk to people in person and test drive the car before they buy it.
In addition, members of Gen Z are looking for a car that fits their budget, but the vehicle also needs to fit their lifestyle, so they will put in the work to find that balance.
Generation gaps
A recent MarketWatch Guides survey of car owners who were 18 years old or older asked a series of questions about car care attitudes and practices.
The first question in the survey was, “How well do you think you take care of your car?” Respondents were given one of four choices:
A. I care for my care and maintain it to the best of my abilities.
B. I am mostly responsible about car care and maintenance.
C. I don’t care for my car as well as I should.
D. I don’t care for or maintain my car with any regularity.
Baby Boomers led the way with 59.3% saying "I care for my car and maintain it to the best of my abilities," followed by 56.1% of Millennials, 54.9% of Gex X and 50.6% of Gen Z answering the same way.
My interpretation: Most people are going to take care of their cars, especially Millennials who are now older and probably have nicer and newer cars than members of previous generations when at their age. Both Millennials and members of Gen Z see their cars as part of their lifestyle, so they are going to maintain them. Most Baby Boomers are in retirement or are nearing retirement, so they are going to maintain their vehicles to avoid the expense of replacing them. Cars are considered transportation for members of Gen X, who are sandwiched between taking care of their parents and their kids, so things like vehicle maintenance are sometimes going to slip through the cracks.
Question number 2 was, “How much do you stick to your manufacturer’s recommended service schedule?”
A. Almost always.
B. Most of the time.
C. Only sometimes.
D. I do not follow the manufacturer’s service schedule.
Baby Boomers led the way with 35.5% answering "almost always." Meanwhile, 34.6% of Millennials, 30.8% of Gen X and 25.7% of Gen Z picked the same response. Millennials answered "most of the time" more than any other group.
My interpretation: Following the car manufacturer’s recommended service schedule is not cheap, but Millennials, Boomers and Gen Xers see value in spending their money in this way to maintain their vehicles. In fact, I know people who have spent $3,000 in order to maintain a $3,000 car because it’s way cheaper than buying a new or used car. With new and used car prices still high, I expect this trend will continue. Gen Z is the most stressed-out generation from a financial standpoint as they enter their work lives, so it’s not surprising that they are the least likely to follow the manufacturer’s recommended service schedule.
Question number 3 was, “How often do you change your car’s oil?”The following options were offered:
A. Every 3,000 miles or more frequently.
B. Every 4,000 to 5,000 miles.
C. Less frequently than every 5,000 miles.
D. I don’t change it regularly.
At 37.5%, Gen X was the biggest group to say "every 3,000 miles," while 37% of Millennials, 25.3% of Gen Z and 25% of Boomers chose the same answer.
My interpretation: Oil change intervals are lengthening thanks to new synthetic oils that provide extended life. Millennials are the best at changing their oil regularly. The lack of oil change regularity for Gen Z is not surprising because of cost restraints. Older generations probably follow the 5,000-miles-or-less recommended interval practice.
The final question was, “How quickly do you address issues or warning lights?” with the following options as answers:
A. As soon as possible.
B. As soon as it is convenient for me to do so.
C. I wait until I have the money to pay for service.
D. I wait to see if the problem goes away on its own.
The results of this question said a lot about each generation. Baby Boomers led the way with 68.6% answering "as soon as possible," followed by Gen X at 59.2%. Millennials were not far behind Gen X at 56.9% when answering "as soon as possible," while Gen Z was a distant last at 40.7%.
My interpretation: All three of the older generations know the risks associated with ignoring warning lights. Boomers usually have the time to get warning lights checked and fixed right away. Gen Xers and Millennials have busier schedules, so they deal with check engine lights when it’s convenient. Members of Gen Z know they have to get lights checked and possibly fixed, but their financial situation forces them to hold off until they have the money.
The purchasing habits of Baby Boomers and Gen X are well-established and unlikely to change.
As we get older, we tend to drive less and when retirement for many Baby Boomers does come, cumulative generational vehicle miles are going to drop.
How to reach Gen Z
How do you reach younger car owners? Research shows that members of Gen Z are looking to independent businesses as the leading source for their vehicle maintenance needs. This next generation of vehicle owners needs a "safe place" where they don’t experience auto anxiety and can rely on trusted advisors.
The challenge is reaching them so they know such a place, like yours, exists. And it starts with having an online presence.
Gen Z Googles everything and spends more time on YouTube or video websites than I ever thought possible.
Tire dealerships who want to earn their business should consider starting their own YouTube or other social media channels and populating these platforms with basic tire and car care tips.
If the Gen Z vehicle owner suspects they may need new struts and comes across a video either on your dealership’s site or linked to your site that explains how they can tell if they need them, why the struts should be replaced and what happens when struts aren't replaced, they will see you as a trusted information source and service provider.
There’s a good chance they will call your dealership or even visit it.
Tire dealers already have access to a library of consumer education videos that can be easily added to a website or social media channel.
The Tire Industry Association (TIA) offers a consumer tire and service education section on its website featuring videos that explain proper tire repair, tire inspection, tire selection, how tire pressure monitoring systems work, tire registration and more.
Offering a strong online consumer educational library will answer consumers’ questions. If your web provider can provide a chat function or something similar to answer additional questions, you will be even more likely to earn Gen Z business.
How to reach Millennials
Millennials are known for sometimes prioritizing their personal satisfaction and image over practicality. Gen Z shares some of those traits, but also is looking for balance between budget and lifestyle.
It’s an outside-the-box idea, but imagine loaning a filter wrench and the catch bin/container to members of this generation who want to change their own oil? Then you sell them the oil and filter.
Remember, members of younger generations are smart, but are strained financially.
Most also use subscription services, paying a fixed, monthly cost. (Think Netflix, Amazon and other streaming TV platforms.)
What about starting a car or tire club where the customer is billed $20 a month to a debit or credit card and the money accrues in a “savings account” at your dealership?
When a financially strained Gen Zer comes in for an oil change or some other service, the money is taken out of their account, so they don’t take the bigger hit to their monthly budget.
If they know they’re going to need tires, then they up their contributions to $30 a month.
When that big bill hits, there’s a way for them to get it fixed right away and pay off the balance with regular monthly withdrawals.
Millennials and members of Gen Z like to do their research.
Educate them, coach them and explain the “why” behind the repair so they have a better understanding of the cost and benefits.
As with other generations, that education process can start online with videos about tire and auto maintenance.
You can then follow this up with car care clinics, so they can physically see how to do things like change windshield wipers, air filters and install the spare tire.
Your customers are changing and to remain successful, you have to change with them. As an independent tire dealer and auto service provider, you are in the perfect position to create relationships with the next generation of customers.
If you want to reach what will be more than 40% of the current U.S. population by the year 2030, according to various estimates, you will have to adapt your business model.
