Renewed interest in utility vehicles by young car buyers brings Ford to the forefront.
Among America’s 80 million-strong millennial generation (those born between early 1980s and early 2000s), Ford has moved to the first brand considered by young car buyers. It is this generation’s growing interest in utility vehicles that has moved Ford from fourth place in 2008 to first place this year.
Maritz Research, a St. Louis-based marketing research firm asked would-be buyers and actual buyers about their new vehicle preferences and buying behaviors. This study came from research conducted between 2008 and 2013.
Marketers explain that purchase consideration is the leading indicator for future purchases, known in the industry as the “sales funnel.” This means that consumers move from awareness of a brand to consideration to eventual purchase.
Small and midsize cars remain the top two segments both considered and purchased by younger buyers, but compact and full-size SUVs, such as Ford Escape and Ford Explorer, show the largest jumps in considerations. The percentage points of jumps (1.1 and 1.7 respectively) may seem small, but the potential sales volume represents hundreds of thousands of vehicles (181,000 Ford Escapes and 280,000 Ford Explorers). In July alone, Explorer sales were up 32 percent with 16,797 vehicles sold, best July sales since 2005, and Ford Escape had its best July with 26,558 vehicles sold, a 19 percent gain!
It’s no coincidence that the jump in millennials’ interest in SUV’s coincides with Ford’s overhaul of its utility vehicle lineup, including the Explorer in 2011 and Escape in 2012.
Amy Marentic, Ford global car and crossover manager says, “The trend of millenials starting families comes at the same time Ford is updating or replacing nearly its entire product lineup,”
Millennial brand preferences changing
In 2008, Ford ranked fourth with millenials in terms of brand consideration, and in 2013, Ford jumped to first. Ford became the brand considered first most often, and showed the biggest jump in “first consideration,” rising 5.5 percentage points.
Chris Travell, vice president, strategic consulting for Maritz Research said, “Millennials are an important group of buyers in the industry today, and not just in terms of their size. They are also helping to refine the vehicle shopping and ownership experience. These younger buyers are more connected than previous buyers.
No surprise that Ford feels increasing purchase consideration and sales to millennials is important.