||Who's Buying 'Youth' Cars? Seniors
When Toyota Motor Corp. rolled out its Scion brand nearly 10 years ago, its goal was to attract a certain buyer it felt wasn't being addressed by its staid Camry and Corollas -- namely the hip, tech-savvy and young.
Today, however, the brand's line of funky-looking small cars is attracting buyers like Leslie Olsen, a 65-year-old retired university director from Golden, Colo., who recently leased a burgundy 2012 Scion xB.
"It didn't look like a typical senior citizen car," Ms. Olsen said of the xB's boxy, low-slung design. "It looks young."
Appealing to the young has auto makers designing and marketing to the "millennial generation" -- that group of consumers in their 20s and 30s whose numbers could rival the postwar baby boom that has dominated the auto market for decades.
But senior citizens are making Swiss cheese of those efforts. Several years ago, for instance, Kia targeted youthful buyers with its Soul using commercials starring break-dancing hamsters. The Soul, which offers a sound system with light-ringed speakers that pulse to the beat of the music, is now one of the top 10 cars bought by baby boomers, according to Strategic Vision, a San Diego, Calif., research firm.
"My grandchildren love the pulsing speakers," said Brian Thulson, a 53-year-old handyman who bought his Kia Soul for work and personal use.
He said the car is more accessible that higher riding sport-utility vehicles. "I think that's some of the reason people my age like this car. It's easy to get in and out of," Mr. Thulson said.
Such unintended customers has prompted Kia to employ a two-track approach to promoting the Soul. It has marketing tie-ins with youth-oriented events, such as the Vans Warped Tour and the MTV Video Awards, and it has run newspaper ads highlighting features that appeal to older buyers, said Michael Sprague, U.S. marketing chief for Kia Motors Corp.
In recent years, auto makers have developed a bevy of pint-size models like the Chevy Sonic, Fiat, Ford Fiesta and Kia Soul, and promoted them using social-media, music festival sponsorships, and in some cases, daredevil stunts. To hype the new Chevy Sonic, General Motors Co. filmed the subcompact parachuting out of a plane for an online campaign aimed squarely at 18-to-30-year-olds.
But the largest customers for these cars, about 42% of buyers this year through May, are closer to retirement age, according to registration data compiled by car-shopping website Edmunds.com. The proportion is up from just 29% five years ago.
Meantime, the percentage of 18- to 34-year-olds buying new subcompact cars fell to 12% through May, down from 17% in 2008, according to registration data.
"It's a delicate line you walk between the market you'd like to grow, versus the market that is your cash cow," said Jessica Caldwell, an analyst with Edmunds.com.
Of course, 50 and 60-somethings are some of the biggest buyers of all cars.
"The baby boomer generation is the largest cohort in the marketplace," Kia's Mr. Sprague said. "Just by virtue of their numbers being so large, we'll continue to see them skew the data for a long time."
Last year, buyers 55 and older accounted for more than 40% of all new car sales, up from 33% in 2008 while buyers between the ages of 18 and 34 represented only 12% of new-car purchases. And that is down from 14% five years ago, according to Edmunds.com.
One reason auto makers have developed youthful brands and products is to latch onto young adults in the hope of keeping their loyalty as they age and buy more expensive vehicles. However, they face an uphill battle. Some can't afford a new car or don't want one because they live in cities where they have public transit, says Michael Sivak, a professor with the University of Michigan Transportation Research Institute.
Auto makers' big prize is the "Millennial Generation" -- that group of consumers in their 20s and 30s whose numbers could rival the postwar baby boom that has dominated the auto market for decades.
In some cases they find the tastes and pocketbooks of 20-somethings similar to older buyers. Job- and cash-strapped millennials aren't too different from boomers living on a fixed income, marketers said.
Elsewhere, older buyers have fond memories of some brands. The tiny Fiat 500, which made its U.S.-debut in 2011, is targeted to young, urban customers with features such as two-toned interiors and bold colors with Italian names like "Rosso Brillante."
Marketing pamphlets show young people packed into the car "playing with their iPhones," said Richard Foley, general sales manager of Fiat of Lakeside in Macomb, Mich.
But retro-styling and the Fiat brand's name recognition among older drivers has made it a hit with their parents' generation. About 37% of Fiat 500 buyers this year through May were age 55 or older compared with only 12% that were under 34, according to Edmunds.com.
"If you ask a young person 'what's a Fiat?' and they wouldn't have a clue," Mr. Foley said. "The older crowd knows the car. They either had one in the past or knew someone who did. Few brands market directly to boomer-age buyers, despite their strength in numbers."
"Just because I'm a baby boomer doesn't mean I want my body to feel like I'm 55 or 65 years old," said Alexander Edwards, president of Strategic Vision. "So when marketing messages are for millennials, there are a lot of things that are attractive to the older generation."
One exception is a series of ads recently released by Toyota for its Venza crossover. The ads show parents out mountain biking or going to an outdoor concert, while their kids are at home or on the computer fretting if they're getting out enough.
(Source: The Wall Street Journal, 08/13/13)