Bringing in younger buyers

The average age of new-vehicle buyers increased dramatically from 46.5 in 2008 to 53.4 in 2010 (Source: 2010 Auto Offline Media Report – Summer) as lower income buyers – who are often younger – were forced out of the market due to the poor economic environment.  This shift has impacted almost every automotive brand, including the youth-oriented marques shown below.

Manufacturers want to create repeat, if not life-long, customers but it’s a challenge to bring in younger buyers.  Among full line premium brands, the core car lineup is crafted in part to appeal to buyers of different incomes and ages.  Their entry-level vehicles are generally sportier and more appealing to more youthful (whether in body or spirit or both) buyers.  As shown below, this strategy generally plays out as expected.

Brand loyalty, on the other hand, doesn’t demonstrate a similarly obvious pattern.  The brand retention rate, which is the % of former model owners who purchase within the brand for their next new vehicle, increases with vehicle size for Lexus and Mercedes and fluctuates for Audi and BMW.  Buyer loyalty is far from guaranteed.

Meanwhile, domestic premium brands Lincoln and Cadillac continue to struggle with the younger set.  The Cadillac CTS average owner age is over 60, more than a decade older than many competitive models, while the Lincoln MKZ fares even worse.  What’s worse is that only 12% of CTS buyers and 3% of MKZ buyers are below 45 years of age, compared with roughly one-third of buyers for A4, 3 Series, IS-Series, and C-Class.

Although Lincoln and Cadillac have revamped their product portfolios in recent years and improved their long-term viability, they’re still not drawing younger buyers.  This avoidance is probably more at the brand level – domestic marques often lose the perception battle due to past quality problems and the more recent bailout (excluding Ford brands on the latter issue).  Eventually, perhaps, their sustained efforts can slowly widen that appeal and create new lifelong owners.

Bookmark and Share

Tagged with:


There are no comments yet...Kick things off by filling out the form below.

Leave a Comment