The auto industry has long been striving to understand millennials: their shopping habits, their financial standing, whether or not they even want a car.
Many questions have been answered. But in the F&I world, some wonder: Will millennials buy F&I products?
The short answer is yes, F&I insiders say.
Many millennials are price-conscious and in debt, but they have grown up in an era when buying protection products on expensive, technology-laden items are commonplace.
“Because they have grown up with consumer electronics, they are preconditioned to having some sort of coverage,” said Jeff Beaver, senior vice president of marketing and product management at Dent Zone Cos. So buying a service contract on a vehicle may be a natural step for them, he said.
Brian Crisorio, vice president of marketing at United Development Systems, holds a similar view. He’s convinced millennials are “going to see a need and value in the F&I products offered in today’s dealerships and tomorrow’s.” They see the value in protecting something important to them, he said, and their cars will likely fall into the same category.
Willing to learn
Millennials’ tendency to keep a close watch on their personal finances also may draw them to protection products. Many not only watched their parents get laid off in the Great Recession, they also graduated from college during the period, making it difficult for them to find employment.
As a consequence, “they are more focused on quality of life and how to preserve that,” said Jenny Rappaport, CMO for EFG Cos. “They are willing to go through an education process to learn about protection products that will bring them value.”
John Pappanastos, CEO of EFG Cos., cautions, though, that millennials’ shopping habits vary from those of previous generations. “There’s a difference in the way they like to be sold,” he said.
Crisorio agrees. Millennials are used to having “information at their fingertips,” he said. “The biggest failure of dealerships is being resistant to putting F&I product information on their websites,” he said.
At the very least, dealerships should upload information detailing why products are important and how they protect customers, Crisorio added. “It’s all about how you reach that new customer and how you draw them in.”