Gen Z Car Buyers Shop Digitally but Complete Purchases in Person

Consumers — especially younger generations — are conducting more and more purchases digitally, but especially for high-consideration, large-ticket items such as cars, many shoppers are not willing to give up the in-person experience.

In an interview with PYMNTS, Rebecca Lindland, senior director of industry data and insights at Cars.com, noted that young shoppers tend to leverage digital channels at various steps of the process but ultimately complete their purchase onsite.

“We recently did a study, and the majority of younger people actually want to complete their purchase of a vehicle in person at the dealership, which was a bit of a surprise for us,” Lindland said. “But we think that part of it is that you still want that chance to touch and feel and test drive your vehicle. … Younger consumers in particular still want to have that experience of going into the dealership, looking the person in the eye — that feeling of authenticity.”

Since cars tend to be the “second-largest purchase” a consumer will make, she said, these interactions can go a long way toward driving trust.

Digital tools, however, simplify the shopping journey in the earlier steps. Consumers use these to browse nearby dealers’ inventory, calculate payments, initiate online negotiation and get a valuation for trade-in.

Across retail categories, many consumers are now conducting their purchasing journeys via both digital and in-person channels, per the PYMNTS Intelligence study “2024 Global Digital Shopping Index: U.S. Edition,” created in collaboration with Visa Acceptance Solutions. The report, which draws from a survey of more than 2,400 U.S. consumers, found that 1 in 5 consumers are digitally assisted in-store shoppers, preferring to use digital tools to improve their brick-and-mortar journey.

As consumers feel ongoing economic pressures, Lindland noted that shoppers have been “very conscious of affordability, very conscious of their payment,” using the site’s payment calculator more and seeking better deals and more insight into financing plans. Yet this does not mean that everyone is buying used.

“The challenge we’re seeing with used vehicles is available inventory … but there’s still a healthy amount of activity in the used vehicle market as well,” Lindland said.

The January PYMNTS Intelligence study “Consumers Shop Secondhand Stores as Often as Other Retail,” which drew from a survey of more than 2,300 U.S. consumers, found that 43% of consumers purchased a secondhand product in 2023. Among those, 11% bought automobiles.

Overall, cost is top of mind. The February/March 2024 installment of the PYMNTS Intelligence “New Reality Check: The Paycheck-to-Paycheck Report” series, “Why One-Third of High Earners Live Paycheck to Paycheck,” revealed that half of consumers have turned to cheaper retail merchants due to retail product price increases. Plus, 45% of low-income shoppers (those who make less than $50,000 annually) and 41% of middle-income ($50,000 to $100,000) shoppers said they had traded down on quality in the previous year.

Looking ahead to what the next year has in store, Lindland said, “I think we’ll still be talking about the new normal, which is a higher price point, scarcity of inventory and new technology.”

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