Automakers Should Turn to Technology to Target Millennials, Reports New Microsoft Survey
Jan. 26, 2009
Online customization, mobile alerts, self-service kiosks and other high-tech channels are preferred by millennial customers when shopping for cars, trucks and SUVs.

REDMOND, Wash. — Jan. 26, 2009— Technology may be the key to engaging the estimated 80 million people of the “millennial generation” — those born between 1981 and 20001 — as automotive consumers, according to a new survey released today by Microsoft Corp.

The Microsoft “Millennials in Automotive Survey 2009,” conducted by Washington, D.C.-based KRC Research, found that not only do millennials have heightened expectations as to how automakers should interact with them via high-tech channels, but also they expect to use newer, more innovative technologies in their eventual places of employment.

“Millennials represent an untapped market for many automakers, as these younger adults are now entering the workplace and purchasing vehicles on their own for the first time,” said Dave Graff, U.S. automotive industry solutions director, Microsoft. “However, for automakers to court these tech-savvy consumers, they need to embrace newer technologies as a way to communicate and sell more effectively to them.”

Millennials as Automotive Consumers

According to Microsoft research from 2008,2 millennials reported using a wide variety of technology tools in their day-to-day lives, such as social networking sites (77 percent), instant messaging (IM) (71 percent), and wikis (59 percent). Half of those surveyed subscribed to more than one social networking site, 64 percent frequented them daily and 33 percent reported spending 30 minutes or more for each visit.

Because of this proclivity toward using technology in their personal lives, millennials have similar preferences in interacting with companies and brands. In the Microsoft “Millennials in Automotive Survey 2009,” 91 percent reported that it is important for auto manufacturers to offer Web sites that give a full view of purchase options and service history, while 86 percent and 87 percent, respectively, said that Web-based auto financing and service requests, and customization of car options, such as color and add-ons, were important.

Beyond the Web, millennials in the survey reported wanting to interact with automakers through IM (56 percent) and other popular high-tech channels. For example, 74 percent want to be able to visit automotive company-hosted blogs to post concerns or ask questions; 52 percent want to get mobile alerts regarding new car releases, price drops and more; and 44 percent sought to network with other auto enthusiasts through automotive company-supported social networking sites, Facebook or MySpace groups.

When comparison shopping for a car, the majority of millennials prefer to visit dealers in person (91 percent), but roughly half (52 percent) would prefer to use self-service kiosks or mobile devices at the dealership to automate the shopping process versus talking to a person. In addition, 89 percent will compare products, services and rates on company Web sites, while large percentages of millennials report they will seek advice from third-party consumer Web sites (65 percent), third-party consumer blogs (45 percent), friends or colleagues via social networking sites (61 percent), and friends and family (87 percent).

Millennials as Automotive Workers

Although the current economic crisis has limited the ability of automakers and other companies to hire, the average age of an American autoworker is now 55 — creating a potential labor shortage for the industry in the near future.3 To court millennials as employees, automakers will need to leverage technology as a recruiting tool, according to the survey. In fact, 87 percent of millennials stated that being able to work with “newer, innovative technologies” in the workplace would make them more likely to consider a job opportunity.

Millennials surveyed who are employed also had clear expectations of their employers’ providing specific types of technologies for their use in the workplace. These included company-provided PCs (62 percent), mobile and smartphones (32 percent), internal company IM (32 percent), access to social networking sites (28 percent), company intranet and portals (49 percent), and company-provided virtual meetings (27 percent).

However, a potential hurdle in recruiting younger workers into the automotive industry may be their perception of the industry itself, the survey found. Fifty-six percent of millennials believe the industry is “old in general,” while large percentages also mentioned the industry “does not offer career stability” (52 percent), has “older workers” (55 percent) and has a “poor public image” (53 percent).

“Automakers and dealers already face enormous problems around operational costs, union contracts and the credit crisis,” Graff said. “As the largest wave of consumers entering the market since the baby boomers, millennials represent an amazing opportunity for automakers to tap into a new customer base. However, this requires a larger strategy toward leveraging customer-facing technology for competitive advantage — such as social networking sites, instant messaging and mobility.”

About the Microsoft “Millennials in Automotive Survey 2009”

Washington, D.C.-based KRC Research conducted the Microsoft “Millennials in Automotive Survey 2009,” from Jan. 5 to Jan. 12, 2009, and garnered responses from 400 young adults in the United States born 1980 to 1990. Portions of a previous KRC Research-conducted survey, the Insurity/Microsoft “Millennials in Insurance Survey 2008,” were also referenced in this release. That survey was conducted from April 21 to April 27, 2008, among more than 700 young adults in the United States and Canada, born 1980 to 1990. The full survey results can be downloaded at http://www.microsoft.com/automotive.

About Microsoft in Automotive

Microsoft has been working with the automotive industry for more than a decade. The Microsoft Automotive and Industrial Equipment vertical works with industry partners to develop solutions based on Microsoft technologies that enable original equipment manufacturers (OEMs), suppliers and customers to improve efficiency, effectiveness and knowledge across the business. Business applications, Microsoft .NET Framework-based technologies and enterprise platform support help manufacturers accelerate time to market, collaborate globally with engineers, reduce costs by leveraging the power of the Internet, and increase visibility into their production and supply chain processes. More information can be found at http://www.microsoft.com/automotive.

About Microsoft

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

1 Source: U.S. Bureau of Labor Statistics

2 Source: Insurity/Microsoft “Millennials in Insurance Survey 2008”

3 Source: MSNBC, “Detroit Seen Facing a Skilled Labor Shortage,” http://www.msnbc.msn.com/id/10097038

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