Germany Marketing Cars to Gen Z and Millennials Consumer Report 2024
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Report Summary
47% of Gen Z and 48% of Younger Millennial car buyers consider price to be an important factor when buying a car, whereas 54% of Gen Z and 51% of Younger Millennials consider quality to be an important factor. This shows that convincing young buyers of quality is likely to make the cut.
Financial confidence among Gen Z and Millennials is recovering. Although Gen Z shows higher financial confidence, a significant portion may lack the disposable income to purchase a new car. Conversely, even though Millennials demonstrate lower confidence levels, they remain a valuable consumer segment due to more stable employment, higher potential savings and lifestyle shifts that require a car purchase.
As Gen Z and Millennials recover from a financially challenging period, brands have a chance to forge positive connections with them to boost sales. Using experiential marketing to create excitement and blending innovation and aspiration will hit the mark, even with car enthusiasts.
This report looks at the following areas:
- Car ownership and purchase details
- Factors important to Gen Z and Millennials when buying a car, such as price, quality and innovation
- Attributes that Gen Z and Millennials consider appealing in a car brand, such as sustainability, heritage and individuality
- Attributes like quality and sustainability associated with certain brands, including German brands and other brands such as Tesla, Renault and Skoda
- Attitudes towards cars, including attitudes towards value for money and sustainability
- Consumer typologies based on attitudes towards cars; this section entails characterisations of and implications for targeting four identified consumer groups, namely Eco-driven enthusiasts, Indifferent consumers, Eco-driven functionality seekers and Functionality focused consumers
Millennials are a crucial demographic for the car market. But as Gen Z grows in importance, it is vital to use social media to articulate authenticity and trust.
Venkatesh Modi, Automotive Research Analyst, Germany
Table of Contents
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EXECUTIVE SUMMARY
- The five year outlook for marketing cars to Gen Z and Millennials
- Market context
- Gen Z entering car-buying age will aid new car sales, particularly electric cars
- Millennials are a core target audience for car brands
- Sustainability will become increasingly important
- Mintel predicts
- Social media will become crucial as Gen Z gain significance
- Sustainability is a growing issue for the car industry
- Opportunities
- Use social media to provide trustworthy proof of quality for Gen Z and Younger Millennials
- Offer Gen Zers and Millennials the opportunity to indulge in luxury experiences
- Utilise experiential marketing to generate enthusiasm among young consumers
- Graph 1: consumers who consider excitement to be an appealing brand attribute, by generation, 2024
- Blend innovation and ambition to attract enthusiasts
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MARKET DRIVERS
- The German economy
- 2024 is expected to remain challenging
- Graph 2: key economic data, in real terms, 2019-25
- The inflation rate is bouncing back to more conventional levels
- Inflation is still the key factor affecting consumers' finances…
- …confidence and expenditure
- Graph 3: financial confidence index, 2022-24
- Consumer confidence among Gen Z and Millennials is on the rise
- Graph 4: consumers who feel confident about their financial situation over the next year or so, by generation, 2022-24
- Gen Z entering car-buying age will drive electric transformation forward
- Millennials continue to be an appealing target audience for car brands
- Media consumption habits
- Media consumption habits vary by generation
- Graph 5: daily use of free/paid-for media formats (NET), by generation, 2023
- Social media's evolving role as a search engine and the rise of influencers offer new marketing opportunities
- Streaming platforms will help reach a wider Gen Z and Millennial audience
- Rise of alternatives to car ownership
- Gen Z and Millennials depend more on alternatives to ownership
- Graph 6: type of access to car, by generation, 2024
- Marketing to Gen Z and Millennials will evolve as various ownership models gain popularity
- Sustainability
- Growing focus on sustainability will push brands to adapt marketing
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WHAT CONSUMERS WANT AND WHY
- Car ownership
- Gen Z show lower car ownership
- Consider long-term advantages when targeting Gen Z
- Younger Millennials are an important consumer segment…
- Graph 7: car purchasing details, by generation, 2024
- …but Older Millennials should not be underestimated
- Important factors when buying a car
- Importance given to price varies across generations
- Graph 8: important factors when buying a car, by generation, 2024
- Few Gen Z and Millennial car buyers consider sustainability to be an important factor
- Use social media to provide authentic proof of quality to Gen Z and Younger Millennial car buyers
- Methods to convey quality with trust
- Highlight the fun element when targeting Gen Z
- Examples of ads conveying fun while driving
- Appealing brand attributes
- Brands need to work on creating a sustainable image
- Graph 9: most appealing attributes in a car brand, 2024
- Showcase commitment to sustainability in an engaging manner to resonate with Gen Z and Millennials
- Provide Gen Z and Millennials with the chance to enjoy luxury
- Graph 10: consumers who consider luxury to be an appealing brand attribute, by generation, 2024
- Ways to provide luxury experiences
- Gen Z and Millennials show a preference for exciting brands compared to older generations
- Leverage experiential marketing to generate excitement among young consumers
- Build a reputation for safety to attract female car buyers
- Attributes associated with different brands
- German car brands are perceived to be high quality
- Highlight value for money to cultivate a favourable perception in a tough economy
- Graph 11: consumers who associate car brands with value for money, 2024
- Enhance the perception of sustainability among Gen Z and Millennials through accurate messaging
- Graph 12: consumers who consider specific brands to be sustainable, by generation, 2024
- Prioritise sustainability aspects related to production to appeal to Gen Z
- Graph 13: sustainability issues Gen Z wants car brands to prioritise, 2024
- Show how recycling/upcycling can cut down the use of natural resources to resonate with Millennials
- Graph 14: sustainability issues Millennials want car brands to prioritise, 2024
- Attitudes towards cars
- Improve sustainability research to attract consumers
- Methods for enhancing sustainability research
- Promote mindful consumption to help consumers reduce their environmental impact
- Consumers of all ages seek value for money
- Graph 15: consumers who agree that value for money is more important than the brand of a car, by generation, 2024
- Consumer typologies
- German consumer typologies based on attitudes towards cars
- Segment 1: Eco-driven car enthusiasts (24%)
- Graph 16: eco-driven car enthusiasts, by generation, 2024
- Combine innovation and aspiration to generate appeal among enthusiasts
- Cater to the broader definition of sustainability to build a sustainable image
- Segment 2: Indifferent consumers (34%)
- Graph 17: indifferent consumers, by generation, 2024
- Indifferent consumers place high emphasis on brand
- Graph 18: important factors when buying a car, by consumer typology, 2024
- Segment 3: Eco-driven functionality seekers (22%)
- Graph 19: eco-driven functionality seekers, by generation, 2024
- Segment 4: Functionality focused consumers (20%)
- Graph 20: functionality focussed, by generation, 2024
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Advertising and marketing activity
- Mercedes conveys its autonomous driving features through storytelling
- Opel guarantees fun while driving its newest Corsa
- Jeep creatively generates excitement around its new launch
- Mercedes collaborates with a car influencer to exhibit cars
- Toyota emphasises 'by enthusiasts for enthusiasts'
- Hyundai showcases its upcycling initiatives
- Hyundai PET ad showing how different materials used in cars
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APPENDIX
- Appendix – products covered, abbreviations, consumer research methodology and language usage
- Products covered in this Report
- Abbreviations
- Consumer research methodology
- Correspondence analysis methodology
- A note on language
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