It’s time to scratch up the old pages of strategy for what customer wants. This is the time to think about Gen Z and the future of automotive and define a strategy based on what the next generation of customer desires. Many marketing wizards, strategy gurus are working towards solving the riddle of Gen Z customers. It is very important to solve the riddle to have a clear picture of R&D, offering and production. At the moment approximately 25% of the global population comprised of Gen Z and in the near term, the range of percentage is going to increase for the Gen Z.
So the conventional approach for the attracting Gen Z customers won’t work as the perception of Gen Z customer is driven by the rational context. The companies need to reassess the established logic for engagement with new customers.
So who are these Gen Z customers and what do they want and how the automotive industry should cope up with these new customers?
Gen Z customers are socially driven and have a rational approach for everything. In addition, these customers are aware of and care about the environment. The most critical component for these customers is transparency in the operation and authenticity in the products. This group of customers purely focus on precedents to make a sound decision. They don’t like to be sold out by wrong marketing tactics, they do thorough research before buying any product. The Gen Z customer easily switches between the brands if required services are not provided efficiently, so brand loyalty will be a great issue in the future and it will be difficult to retain the customer if services are not provided as promised. These customers are technologically savvy and have the power to lift the brand to a great height and also has the power to degrade it if something goes the other way.
These customers provide only a few seconds of the window for the brands to either perform or go home. The future for these customers is compact devices which makes them aware about everything from their health to their purchases. This is the reason my e-commerce or mobile commerce platform is so attractive to them. They want to live their life with ease without much hassle and want to take decision instantly after their research, so the mobile platform will be the key to success in the future. These customers also support the brands which focus on innovation and always has something new to offer. Furthermore, these customers are very conservative with respect to their finances and focus on value for money.
Gen Z has the power to transform automotive sector. These customers don’t like the idea of keeping the depreciating assets for a long time. For depreciating assets such as a car, these consumers are more favorable towards leasing type of business and do not like to drive, so the model of travel is given importance based on the range or distance they would like to cover. Gen Z customers are also more inclined towards the idea of autonomous vehicles. Automakers have started noticing these trends and have started working on their offerings. In China, automakers are focusing on making customized car based on the demand.
People under the age of 30 in developed countries do not have a driving license and those having the driving license are driving less. The main reason behind these changes is the high cost of vehicle ownership, traffic congestion, alternative mode of transportation, scarcity of parking space and other. Furthermore, cities are also supporting Gen Z rational behavior by improving the air quality by reducing the emission from vehicles, encouraging usage of public transport over private vehicles. This approach by the government converges with the Gen Z perception
The ride-hailing companies are gaining traction from the Gen Z customers because of its ease of operation i.e. controlling the travel with their mobile phones. Apart from ride-hailing companies, companies offering electric car such as Tesla is also perceived as an innovative company with high brand value. Gen Z customers find the brand cool if they focus on innovation. Thus being cool will be one of the factors in the future for success.
Automakers should keep in mind that in future it won’t be just limited to selling and buying, the customer will also prefer for the intangible and holistic experience with respect to the service. In addition, Gen Z also focuses on personalization, so automakers should be able to provide an option to the customer with respect to their preferred customization. In this way, it will help the Gen Z customer to avail a product which matches their ideology. Furthermore, Gen Z prefers mobile over other things, so the products and services should be available on the mobile platform.