GM and GM Financial help Gen Y get into the driver's seat
They're known as Millennials, Generation Next or Echo Boomers – the kids of Baby
Boomers who are all grown up – and their increase in numbers in the U.S. parallels their
parents' generation. While experts differ on the actual start date of Generation Y, they are
typically considered to be 19 to 31 years old in 2012; they are nearly 80 million strong; and,
they comprise more than 20 percent of the U.S. population.
Programs and products are now changing or being developed to include this new breed of
consumer and potential employee.
Driving change in automobiles
Gen Y is set to become one of the biggest domestic automobile-buying market segments and the
largest consumer segment since the Baby Boomers. According to the third annual "Automotive
Generation Y Survey" recently conducted by Deloitte LLP, Gen Y will account for 40 percent
of the car buying population beginning this year, and according to survey participants, 54 percent
say they anticipate replacing their current vehicle over the next two years.
So, what does this generation want when shopping for a vehicle? "Cockpit" technology,
or connected cars, is a leading differentiator for Gen Y when considering and purchasing a vehicle.
These individuals want their personal technology, such as mobile messaging and connectivity to
portable music players, integrated with their driving experience. According to the Deloitte study,
it must be seamlessly integrated and connect to their lives outside of the vehicle.
Manufacturers are listening. The Chevy Volt, GM's second generation "connected
vehicle" was a hit at this year's South by Southwest show in Austin, Texas, a popular
gathering of all things cool and forward-looking in interactive technology, film and music.
The electric vehicle featured modified Galaxy Tab tablet computers for backseat passengers that
are capable of wirelessly streaming movies and other content from sources such as Netflix, Hulu
or recorded DVR programs. Furthermore, GM's OnStar subsidiary is discussing cloud-connected
cars with developers. Cloud computing is the ability for users to access, manage and share their
information from many online sources using only one device. And, this is just the beginning…
GM recently partnered with Ross Martin, an executive at MTV Scratch, which helps connect brands with consumers and is behind the marketing strategy for the popular "Jersey Shore" television show. The intent is to help GM with the look and feel of its Chevrolet cars – which make up 70 percent of GM sales in the U.S. – as well as helping the dealership structure and dashboard technology. GM is targeting the more fuel-efficient models like the Sonic, Cruze and Spark.
|Gen Y: By the numbers
- More than 69% will purchase a used vehicle in the future
- 48% expect to be driving the same brand of vehicle in five years
- 71% agree the environment is an extremely important factor when purchasing
a vehicle and more than 50% of respondents are willing to pay more for a vehicle
that is either environmentally friendly or saves on energy costs
- The shopping experience is three times more important than vehicle design for Gen Y
- More than 82% of Gen Y consumers say they're excited to shop for a vehicle
- More than 67% look for information on a vehicle brand or model on social
networking sites, up from 25% in 2009
- 52.4% say a bad experience with a dealer would cause them to never consider
that brand again
Source: Deloitte LLP Third Annual Automotive Generation Y Survey, 2011. Survey respondents
included 1,024 from Gen Y (average age, 23).
The Gen Yers are starting to build credit by paying student loans, auto loans and mortgages,
according to a February 2012 study by Experian on the generational gap on debt. Gen Yers carry the
least amount of debt, but because they have less-lengthy credit histories, they also have lower
credit scores, which can make it challenging to obtain financing.
GM Financial and GM offer a "Best In Class Alumni & Student Discount" for college
students and graduates in the U.S. They simply visit gmcollegediscount.com
where they can research GM vehicles and apply online for financing through GM Financial. Because
we are an indirect lender, the approved application is sent to the dealer, who then contacts the
customer and completes the sale.
Diving into a new talent pool
With Millennials making up approximately 40 percent of the car buying population, it's only
fitting that they might also be outstanding employees in auto dealerships or the auto finance business.
According to GM Financial's Lisa Northup, vice president of Human Resources, this generation comprises
about one quarter of GM Financial's diverse pool of talent. The company has been steadily hiring
since late 2011, including those from Gen Y.
Recruiting at colleges and universities is one of the traditional ways to reach this demographic.
Lee Stone, GM Financial's vice president Credit Center Operations in Florida, recruits from about
10 colleges and universities across the state. "I look for candidates that will be good personality
and culture fits for our team and for our dealer customers. I can teach the credit and underwriting
skills, but I want to find the cream of the crop, those who are excited and full of fresh perspectives,
who will also fit in with an already solid team we have built." So far, Stone has hired about 15
or more recent college graduates that make up his team of 50 employees.
It's no surprise social media sites such as LinkedIn and Facebook are also places to recruit
Gen Y candidates. The GM Careers
site on Facebook is going strong with more than 6,500 "Likes" and GM Financial is currently
developing a similar site. The career sites on Facebook - separate from corporate or product
sites for most companies - provide visitors and prospective employees with information about the
company and its products, its culture, career path options and current job openings.
The bottom line
In summary, it's critical for manufacturers, dealerships, financial institutions – and
all companies for that matter – to ensure they're "connected" by creating Gen
Y-friendly stores, product offerings and sales processes, lest they miss out on the opportunity to
increase their bottom line from this important consumer demographic.
*As used in this article, "loans" include retail installment sale contracts
originated by dealers and purchased by the company.